Show Summary Details
Page of

The evaluation and provision of effective medicines 

The evaluation and provision of effective medicines

The evaluation and provision of effective medicines

Michael D. Rawlins

Page of

PRINTED FROM OXFORD MEDICINE ONLINE ( © Oxford University Press, 2015. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a title in Oxford Medicine Online for personal use (for details see Privacy Policy).

date: 25 March 2017

As more new medicines become available, often at a premium price, it has become imperative for individual practitioners, institutions and health care systems to assess whether they represent good value for money. Are they an improvement on existing treatments, either in terms of improved efficacy or safety? And, if so, do they represent a cost effective use of health care resources?

New medicines (and other treatments) are subject to evaluation on clinical evidence and on economic grounds. The principal means of assessing clinical effectiveness are randomized controlled trials, controlled observational studies, and case-series together with expert opinion and systematic review. Economic evaluation of medicines is more controversial and raises important philosophical, societal and political questions. In practice, two main approaches are used to assess medicines—cost-effectiveness and cost–utility analyses.

Cost effectiveness analysis - benefits can be expressed in various ways, including (1) natural units - e.g. the cost per mmHg of blood pressure reduction with a particular antihypertensive agent - but this approach has limited application because its use is confined to the circumstances of a single condition; (2) cost per life-years gained - but this has the obvious disadvantage of use only for treatments that prolong life, rather than those that improve the health-related quality of life.

Cost utility analysis - attempts to capture the benefits of a particular health technology using a metric that can be applied across all conditions and treatments by estimating “utility” on account of improvements in both longevity and health-related quality of life. Utility is assessed on a scale of zero (dead) to one (perfect health), with the increase in utility that is brought about by a particular treatment being multiplied by the number of years for which it is enjoyed to provide the additional (incremental) quality-adjusted life year gained (QALY).

Provision of medicines varies greatly between regions and individual nations, which is of critical importance for sick persons and their families. Arrangements are in a state of flux internationally, and highly influenced by economic factors as well as social structures and fiscal tradition. The demand for expensive modern drugs as part of health care are an active focus of political discussion, and the issues raised will continue to impinge on the practice of physicians worldwide, who often face difficult ethical dilemmas as a result. The application of cost utility analysis in deciding how to allocate resources for healthcare requires a definition of the “cut-off”, or “threshold”, between cost effective and cost ineffective treatments. The World Health Organisation has suggested that a cost per QALY below a country’s per capita gross domestic product (GDP) should almost invariably to be considered as cost effective, and those in excess of three times per the national capita GDP should be considered as cost ineffective.

Access to the complete content on Oxford Medicine Online requires a subscription or purchase. Public users are able to search the site and view the abstracts for each book and chapter without a subscription.

Please subscribe or login to access full text content.

If you have purchased a print title that contains an access token, please see the token for information about how to register your code.

For questions on access or troubleshooting, please check our FAQs, and if you can''t find the answer there, please contact us.