The impact of drug vintage on patient survival: a patient-level analysis using Quebec's provincial health plan data.

OBJECTIVES: There is some debate about the value received for the money spent on prescription drugs. Some argue that most drug spending is on "me-too" drugs--drugs that provide only marginal health gains. Others suggest that the opposite is true--new drugs offer good value for money and are well worth the cost. To provide evidence on this issue, we evaluated the impact of drug innovation on the longevity of Canadians. METHODS: We analyzed patient-level claims data from Quebec's provincial health plan. We selected elderly patients with continuous health coverage dispensed at least one drug prescription in each year of the study period, 1997 to 2006. Drug vintage was defined as the active ingredient's earliest marketed date. We estimated the impact of drug vintage on patient survival using a time-varying Cox proportional hazards model that controlled for year indicator variables, patient age, sex, region of residence, low income status, medical services use, concomitant drug use, and comorbidities. RESULTS: Of the 102,743 subjects in the study population, 14,154 (14%) died during the study period. Mean patient age was 68 years; 59% were women. Our survival models indicated that the use of newer medications was associated with a statistically significant mortality risk reduction (hazard ratio: 0.522; 95% confidence interval: 0.476 to 0.572, P < 0.0001), relative to older medications. Other covariates associated with an increased risk of mortality included age, sex (male), low guaranteed income supplement status, hospitalization, and number of comorbidities. CONCLUSION: This analysis showed that recent drug innovation has had a significant beneficial impact on the longevity of elderly patients.

A re-examination of the impact of reference pricing on anti-hypertensive drug plan expenditures in British Columbia.

Reference pricing (RP) limits drug plan reimbursement of interchangeable medicines to a reference price, which is typically equal to the price of the lowest-cost interchangeable drug; any cost above that is borne by the patient. Much of the evidence of the effects of RP comes from 'before and after' studies of the RP scheme adopted by Pharmacare, the publicly funded drug plan for seniors and others in British Columbia, Canada. We critically assess the identifying assumption inherent in the before and after design - namely, that pre-RP trends accurately predict counterfactual outcomes - in the context of estimating the impact of RP on Pharmacare's expenditure on anti-hypertensive drugs for its senior beneficiaries. We use similar data from a public plan that has not introduced RP to estimate the effects on drug expenditures of patent expiration, secular changes in prescribing patterns and various other factors common to all Canadian public drug plans that could potentially confound the before and after estimates of the effect of RP on drug plan expenditures. We find that controlling for such factors reduces estimates of drug plan savings attributable to RP of the Calcium Channel Blockers by about half.

Impact of administrative restrictions on antibiotic use and expenditure in Ontario: time series analysis.

OBJECTIVE: In a potential attempt to guide antibiotic prescribing based on current clinical evidence and mitigate the spread of antibiotic resistance, in March 2001 the Ontario Drug Benefit programme restricted reimbursement of two fluoroquinolone antibiotics--ciprofloxacin and ofloxacin--to its beneficiaries. Our objective was to determine the impact of this policy on the volume and cost of antibiotic prescribing. METHOD: Weekly administrative data on antibiotic prescribing volumes and expenditures were analysed between January 1999 and September 2002 to estimate the effect of the policy changes using time series analysis. RESULTS: The policy changes were associated with a statistically significant shift downwards for the fluoroquinolones as a category (1905 fewer prescriptions each week, representing a saving of Can$105,707 a week), driven by a decrease in prescriptions for ciprofloxacin (2084 fewer prescriptions a week, saving Can$129,421 a week). Nitrofurantoin (200 more prescriptions a week, costing an extra Can$2082 a week) and trimethoprim-sulphamethoxazole (532 more prescriptions a week, costing an extra Can$1473 a week) demonstrated a statistically significant shift upwards. The latter also showed a decrease in trend and nitrofurantoin an increase in trend during the time period. There was no statistically significant change in either the total number of antibiotic prescriptions or expenditures associated with the policy of limiting their use. CONCLUSIONS: Although no direct cause and effect can be shown with these observational data, the results suggest that the change in reimbursement policy to restrict prescribing of fluoroquinolones decreased their use and associated expenditures. These decreases were offset by increases in the use of other antibiotics. The balance of consequent benefit and harm of these shifts in prescribing patterns needs to be examined carefully. Alternative solutions to encourage appropriate use of antibiotics deserve exploration.

The impact of reference pricing of nonsteroidal anti-inflammatory agents on the use and costs of analgesic drugs.

OBJECTIVE: To estimate the effect of reference pricing (RP) of nonsteroidal anti-inflammatory drugs (NSAIDs) on drug subsidy program and beneficiary expenditures on analgesic drugs. DATA SOURCES/STUDY SETTING: Monthly claims data from Pharmacare, the public drug subsidy program for seniors in British Columbia, Canada, over the period of February 1993 to June 2001. STUDY DESIGN: RP limits drug plan reimbursement of interchangeable medicines to a reference price, which is typically equal to the price of the lowest cost interchangeable drug; any cost above that is borne by the patient. Pharmacare introduced two different forms of RP to the NSAIDs, Type 1 in April 1994 and Type 2 in November 1995. Under Type 1 RP, generic and brand versions of the same NSAID are considered interchangeable, whereas under Type 2 RP different NSAIDs are considered interchangeable. We extrapolated average reimbursement per day of NSAID therapy over the months before RP to estimate what expenditures would have been without the policies. These counterfactual predictions were compared with actual values to estimate the impact of the policies; the estimated impacts on reimbursement rates were multiplied by the postpolicy volume of NSAIDS dispensed, which appeared unaffected by the policies, to estimate expenditure changes. PRINCIPAL FINDINGS: After Type 2 RP, program expenditures declined by $22.7 million (CAN), or $4 million (CAN), annually cutting expenditure by about half. Most savings accrued from the substitution of low-cost NSAIDs for more costly alternatives. About 20 percent of savings represented expenditures by seniors who elected to pay for partially reimbursed drugs. Type 1 RP produced one-quarter the savings of type 2 RP. CONCLUSIONS: Type 2 RP of NSAIDs achieved its goal of reducing drug expenditures and was more effective than Type 1 RP. The effects of RP on patient health and associated health care costs remain to be investigated.

Net health plan savings from reference pricing for angiotensin-converting enzyme inhibitors in elderly British Columbia residents.

BACKGROUND: Reference drug pricing (RP) is a cost-sharing strategy commonly used to control drug expenditures. Under RP, a benefit plan fully reimburses medications that are equally or less expensive than the reference price, and requires patients to pay the extra cost of therapeutically equivalent but higher priced drugs. Critics argued that drug plan savings are offset by administrative costs and increased spending on other health services. OBJECTIVE: We evaluated net healthcare savings in beneficiaries >or=65 years from the perspective of the British Columbia provincial health insurance system after it applied RP to angiotensin-converting enzyme (ACE) inhibitors in 1997. METHODS: We estimated savings in new users of antihypertensives after the start of RP plus associated administrative costs and savings from reductions in retail drug prices. Findings were integrated with earlier results on the consequences of RP on expenditures for drugs, physicians, and hospitalizations among all seniors who used ACE inhibitors before the introduction of RP. RESULTS: During the first year after the implementation of RP, savings for continuous users were CAN dollars 6.0 million. Savings for new users were dollars 0.2 million. Approximately five sixths thereof were achieved by utilization changes and one sixth by cost shifting to patients. There were no savings through drug price changes. Administering RP cost dollars 0.42 million. Overall net savings were estimated to be dollars 5.8 million during the first year after the start of RP. The magnitude of these savings is equal to 6% of all cardiovascular drug expenditures in seniors. After 10 years, approximately 50% of savings will be achieved by new users. CONCLUSION: We observed substantial net savings from RP for ACE inhibitors for the provincial health insurance system in British Columbia, although there were generous exemptions from the policy. In other jurisdictions, savings could be higher if drug prices decline after the start of reference pricing.