Development of a budget-impact model to quantify potential cost savings from prescription opioids designed to deter abuse or ease of extraction.

BACKGROUND: Prescription opioid (RxO) abuse, dependence and misuse is a significant and growing problem in the US, and is associated with a substantial economic burden. Such abuse may be reduced by theoretical formulations that minimize the possibility of abuse, dependence and misuse of RxOs by injection, snorting, crushing or chewing. As well as public health and safety benefits, use of an abuse-deterrent/resistant RxO (ADO) that may deter abuse, dependence and misuse could also generate cost savings. OBJECTIVES: To estimate potential annual cost savings to US third-party payers realized from introducing a theoretical ADO. METHODS: A budget-impact model (BIM) was developed to assess potential cost savings from the introduction of an ADO to third-party payers. The BIM included information on ADO attributes, costs associated with RxO abuse-related episodes, prevalence of RxO abuse and potential market share capture of the new ADO. Numbers of abuse-related episodes were calculated using a database on admissions to substance abuse treatment centres and other national surveys. Direct (medical and pharmaceutical) costs associated with RxO abuse, dependence and misuse were calculated using de-identified employer claims data (n > 6 000 000) for costs of abuse-related episodes. All cost estimates are in $US, year 2006 values. The BIM was developed for a theoretical prescription drug with therapeutic properties similar to those of controlled-release oxycodone, in a formulation that is specifically designed to resist or deter common methods of abuse, including injection, crushing, snorting and chewing. RESULTS: Potential cost savings to third-party payers from introducing an ADO for the US (assuming a privately insured cost structure) could range from approximately $US0.6 billion to $US1.6 billion per year depending on different possible scenarios. CONCLUSION: While savings estimates from introduction of an ADO depend on a range of assumptions, cost savings would be substantial.

Does trade affect child health?

Frankel and Romer [Frankel, J., Romer, D., 1999. Does trade cause growth? American Economic Review 89 (3), 379-399] documented positive effects of geographically determined trade openness on economic growth. At the same time, critics fear that openness can lead to a "race to the bottom" that increases pollution and reduces government resources for investments in health and education. We use Frankel and Romer's gravity model of trade to examine how openness to trade affects children. Overall, we find little harm from trade, and potential benefits largely through slightly faster GDP growth.