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Future Drug Prices and Cost-Effectiveness Analyses

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  • Martin Hoyle

Abstract

Most of the drugs previously appraised by the National Institute for Health and Clinical Excellence (NICE) are actually more cost effective than stated by NICE. Furthermore, most or all drugs for chronic conditions are actually far more cost effective than stated by NICE. Hence, it is likely that some of the previous negative decisions made by NICE concerning drugs for chronic conditions would instead have been positive if the methodology in this study had been implemented. It is recommended that, to capture the true cost of a drug, UK-based cost-effectiveness analyses should assume that the future real cost of a drug decreases over time, typically by 4% per annum, with a standard deviation of 2.5%. This change is very easy to implement in cost-effectiveness analyses. Similar conclusions may apply worldwide. Copyright Adis Data Information BV 2008

Suggested Citation

  • Martin Hoyle, 2008. "Future Drug Prices and Cost-Effectiveness Analyses," PharmacoEconomics, Springer, vol. 26(7), pages 589-602, July.
    • Handle: RePEc:spr:pharme:v:26:y:2008:i:7:p:589-602
    DOI: 10.2165/00019053-200826070-00006
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    References listed on IDEAS

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    1. Briggs, Andrew & Sculpher, Mark & Claxton, Karl, 2006. "Decision Modelling for Health Economic Evaluation," OUP Catalogue, Oxford University Press, number 9780198526629.
    2. Patricia Danzon;Jeong Kim, 2002. "The Life Cycle of Pharmaceuticals: A Cross-National Perspective," Monograph 000480, Office of Health Economics.
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    Cited by:

    1. Refoios Camejo, Rodrigo & McGrath, Clare & Herings, Ron, 2011. "A dynamic perspective on pharmaceutical competition, drug development and cost effectiveness," Health Policy, Elsevier, vol. 100(1), pages 18-24, April.
    2. Martin Hoyle, 2011. "Accounting for the Drug Life Cycle and Future Drug Prices in Cost-Effectiveness Analysis," PharmacoEconomics, Springer, vol. 29(1), pages 1-15, January.
    3. Dyfrig Hughes & Lesley Tilson & Michael Drummond, 2009. "Estimating Drug Costs in Economic Evaluations in Ireland and the UK," PharmacoEconomics, Springer, vol. 27(8), pages 635-643, August.

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