The Relationship Between Pharmaceutical Innovation and Cancer Mortality in Spain, From 1999 to 2016.

OBJECTIVES: To investigate the relationship across cancer sites between pharmaceutical innovation and changes in cancer mortality in Spain during the period between 1999 and 2016. METHODS: I investigated whether the cancer sites for which more new drugs were authorized had larger reductions in mortality from 1999 to 2016 in Spain, controlling for the lagged change in cancer incidence. The principal measure of pharmaceutical innovation is the long-run change in the mean vintage (year of initial authorization in Spain) of the drugs for the treatment of a cancer previously authorized in Spain. RESULTS: The 1999 to 2016 increase in mean age at death tended to be larger, and the 1999 to 2016 increase in the number of deaths and life-years lost before the ages 65 years, 75 years, and 85 years tended to be smaller for cancer sites that had larger current or lagged increases in drug vintage. Pharmaceutical innovation was associated with a 2.77-year increase in mean age at death from cancer from 1999 to 2016-96% of the observed increase. New drug authorization during the previous 17 years were associated with a reduction in the number of life-years lost before the age of 75 years in 2016 of 333 000. Under the assumption that the association between pharmaceutical innovation and mortality reduction is causal, estimated drug expenditure per life year before the age of 75 years gained in 2016 from new cancer drugs that were authorized between 2000 and 2016 was €3269. CONCLUSIONS: The cancer sites for which there were more pharmaceutical innovation-more new drugs authorized-had larger 1999 to 2016 reductions in mortality in Spain, controlling for the lagged change in cancer incidence.

Are drug prices subject to creative destruction? Evidence from the US, 1997-2017.

There are several types of pharmaceutical competition. In addition to competition among producers of the same chemical substance ("within-substance competition"), there may be competition among producers of different chemical substances in the same chemical subgroup ("between-substance competition"). There have been numerous econometric studies of the effect of within-substance competition on drug prices, but empirical evidence about the effect of between-substance competition is far more limited. The primary objective of this study is to assess the impact of the entry of new drugs in a drug's therapeutic class on branded drug prices, generic drug prices, and the generic market share, using publicly-available US data for the period 1997-2017. Two methods are used to estimate the effects of between-substance and within-substance competition on those variables. The first method is standard 2-way fixed effects estimation based on aggregate data. The second method, based on micro data, is estimation using the DID_MULTIPLEGT procedure developed by de Chaisemartin et al. (2021), which does not rely on, and allows us to test for, "parallel trends." Between-substance competition does not appear to have any effect on brand-name drug prices, although our inability to fully account for rebates may bias the estimates towards zero. (There is also little evidence for an effect of within-substance competition on brand-name drug prices.) However, between-substance competition has a significant negative effect on generic drug prices. We estimate that the 1985-2005 increase in the number of substances ever registered in a drug's ATC4 chemical subgroup reduced the 2017 price of generic drugs by 42%. (The ratio of the generic-price reduction attributable to rising between-substance competition to the generic-price reduction attributable to rising within-substance competition also happens to be 42%.) A striking finding is that the entry of imitators has no effect on the prices of brand-name drugs, but the entry of innovators has a significant negative effect on the prices of generic drugs in the same ATC4 chemical subgroup. In addition, between-substance competition has a significant positive effect on the generic market share: the 1985-2005 increase in the number of substances ever registered in a drug's ATC4 chemical subgroup increased the 2017 generic market share by 15.0 percentage points. Due to its effects on generic drug prices and the generic market share, the 1985-2005 increase in between-substance competition reduced the average 2017 price of drugs that were already sold in 1997 by 35%. We estimate that 36% of 2017 expenditure on drugs that were first registered during 1986-2005 was offset by reduced 2017 expenditure on drugs that were sold in both 1997 and 2017.

The impact of pharmaceutical innovation on the burden of disease in Ireland, 2000-2015.

BACKGROUND: We perform an econometric assessment of the impact that pharmaceutical innovation had on the burden of disease in Ireland. METHODS: We use a difference-in-differences (or two-way fixed effects) research design: we investigate whether diseases for which more new drugs were launched had larger subsequent reductions in mortality. This design controls for the effects of general economic and societal factors (e.g. income, education, and behavioral risk factors), to the extent that those effects are similar across diseases. RESULTS: New Chemical Entities launched during 1983-1997 are estimated to have reduced the total number of disability-adjusted life-years (DALYs) lost in 2015 by about 234 600. CONCLUSIONS: Pharmaceutical expenditure per DALY gained in 2015 from drugs launched during 1983-1997 was €1137, which indicates that the new drugs launched during 1983-1997 were very cost-effective, overall.

Are patients more adherent to newer drugs?

The annual preventable cost from non-adherence in the US health care system amounts to $100 billion. While the relationship between adherence and the health system, the condition, patient characteristics and socioeconomic factors are established, the role of the heterogeneous productivity of drug treatment remains ambiguous. In this study, we perform cross-sectional retrospective analyses to study whether patients who use newer drugs are more adherent to pharmacotherapy than patients using older drugs within the same therapeutic class, accounting for unobserved heterogeneity at the individual level (e.g. healthy adherer bias). We use US Marketscan commercial claims and encounters data for 2008-2013 on patients initiating therapy for five chronic conditions. Productivity is captured by a drug's earliest Food and Drug Administration (FDA) approval year ("drug vintage") and by FDA" therapeutic potential" designation. We control for situational factors as promotional activity, copayments and distribution channel. A 10-year increase in mean drug vintage is associated with a 2.5 percentage-point increase in adherence. FDA priority status, promotional activity and the share of mail-order prescription fills positively influenced adherence, while co-payments had a negative effect. Newer drugs not only may be more effective in terms of clinical benefits, on average. They provide means to ease drug therapy to increase adherence levels as one component of drug quality, a notion physicians and pharmacy benefit managers should be aware of.

Patterning Oxide Nanopillars at the Atomic Scale by Phase Transformation.

Phase transformations in crystalline materials are common in nature and often modify dramatically properties of materials. The ability to precisely control them with a high spatial precision represents a significant step forward in realizing new functionalities in confined dimensions. However, such control is extremely challenging particularly at the atomic scale due to the intricacies in governing thermodynamic conditions with a high spatial accuracy. Here, we apply focused electron beam of a scanning transmission electron microscope to irradiate SrNbO3.4 crystals and demonstrate a precise control of a phase transformation from layered SrNbO3.4 to perovskite SrNbO3 at the atomic scale. By purposely squeezing O atoms out of the vertex-sharing NbO6 octahedral slabs, their neighboring slabs zip together, resulting in a patterning of SrNbO3 nanopillars in SrNbO3.4 matrix. Such phase transformations can be spatially manipulated with an atomic precision, opening up a novel avenue for materials design and processing and also for advanced nanodevice fabrication.

Has pharmaceutical innovation reduced the average cost of U.S. health care episodes?

A number of authors have argued that technological innovation has increased U.S. health care spending. We investigate the impact that pharmaceutical innovation had on the average cost of U.S. health care episodes during the period 2000-2014, using data from the Bureau of Economic Analysis' Health Care Satellite Account and other sources. We analyze the relationship across approximately 200 diseases between the growth in the number of drugs that have been approved to treat the disease and the subsequent growth in the mean amount spent per episode of care, controlling for the growth in the number of episodes and other factors. Our estimates indicate that mean episode cost is not significantly related to the number of drugs ever approved 0-4 years before, but it is significantly inversely related to the number of drugs ever approved 5-20 years before. This delay is consistent with the fact (which we document) that utilization of a drug is relatively low during the first few years after it was approved, and that some drugs may have to be consumed for several years to have their maximum impact on treatment cost. Our estimates of the effect of pharmaceutical innovation on the average cost of health care episodes are quite insensitive to the weights used and to whether we control for 3 covariates. Our most conservative estimates imply that the drugs approved during 1986-1999 reduced mean episode cost by 4.7%, and that the drugs approved during 1996-2009 reduced mean episode cost by 2.1%. If drug approvals did not affect the number of episodes, the drugs approved during 1986-1999 would have reduced 2014 medical expenditure by about $93 billion. However, drug approvals may have affected the number, as well as the average cost, of episodes. We also estimate models of hospital utilization. The number of hospital days is significantly inversely related to the number of drugs ever approved 10-19 years before, controlling for the number of disease episodes. Our estimates imply that the drugs approved during 1984-1997 reduced the number of hospital days by 10.5%. The hospital cost reduction was larger than expenditure on the drugs.

Do newer drugs treat fewer diseases, controlling for time since launch? Evidence from France and the U.S.

Background: More recently approved drugs have significantly fewer indications than drugs approved many years ago. One possible reason for this may be that, controlling for the number of years since approval or launch, more recently approved drugs have fewer indications (e.g. at the time of launch). The role of precision and personalised medicine has increased, and the goal of precision medicine is to provide a more precise approach for the prevention, diagnosis and treatment of disease. Drugs that have fewer indications may be 'more precise' than drugs that have many indications. Methods: We use different kinds of data from two countries - France and the U.S. - to analyze the relationship across many drugs between the number of indications of a drug, the drug's vintage - i.e. the year in which the drug was first marketed or approved - and its age - the number of years it has been marketed. Results: All the evidence from both countries indicates that, controlling for drug age, more recently approved drugs tend to have fewer indications than drugs approved many years ago. In the U.S., a 10-year increase in vintage is associated with a 10.7% decline in the effective number of indications of all drugs, and a 19.4% decline in the effective number of indications of drugs approved after 1989. In France, the positive effect on the number of indications of the increase in drug age was more than offset by the negative effect of the increase in drug vintage. Conclusions: More recently approved drugs are less likely to be 'general-purpose technologies' (or even multi-purpose technologies) than older drugs. The relative importance of 'precision medicine' has increased in recent decades. Drugs that have fewer indications may be 'more precise' than drugs that have many indications.

Three-dimensional domain identification in a single hexagonal manganite nanocrystal.

The three-dimensional domain structure of ferroelectric materials significantly influences their properties. The ferroelectric domain structure of improper multiferroics, such as YMnO3, is driven by a non-ferroelectric order parameter, leading to unique hexagonal vortex patterns and topologically protected domain walls. Characterizing the three-dimensional structure of these domains and domain walls has been elusive, however, due to a lack of suitable imaging techniques. Here, we present a multi-peak Bragg coherent x-ray diffraction imaging determination of the domain structure in single YMnO3 nanocrystals. We resolve two ferroelectric domains separated by a domain wall and confirm that the primary atomic displacements occur along the crystallographic c-axis. Correlation with atomistic simulations confirms the Mexican hat symmetry model of domain formation, identifying two domains with opposite ferroelectric polarization and adjacent trimerization, manifesting in a clockwise arrangement around the hat's brim.

Number of drugs provided by the Pharmaceutical Benefits Scheme and mortality and hospital utilization in Australia, 2002-2019.

We analyze the relationship between long-run changes in the drugs provided by the Pharmaceutical Benefits Scheme (PBS) and mortality and hospital utilization in Australia, by analyzing the correlation across diseases between the change in the number of drugs used to treat the disease provided and the subsequent change in mortality or hospital utilization from that disease. Our estimates indicate that diseases for which there were larger increases in the number of PBS drugs tended to have smaller subsequent growth in premature (before ages 85, 75, and 65) mortality. Diseases for which there was larger growth in the number of PBS drugs also tended to have smaller growth in the number of hospital days 2-10 years later. The reduction in the number of hospital days appears to be primarily attributable to a reduction in average length of stay. We estimate that the 1996-2013 increase in the number of PBS drugs was associated with a reduction in the number of years of life lost before age 85 in 2019 of 359,026, and that the 1994-2011 increase in the number of PBS drugs was associated with a reduction in the number of hospital days in 2019 of 2.48 million. A rough estimate of the cost per life-year before age 85 gained in 2019 from drugs previously added to the PBS is $AUS 1388.

Is home health care a substitute for hospital care?

A previous study used aggregate (region-level) data to investigate whether home health care serves as a substitute for inpatient hospital care and concluded that "there is no evidence that services provided at home replace hospital services." However, that study was based on a cross-section of regions observed at a single point of time and did not control for unobserved regional heterogeneity. In this article, state-level employment data are used to reexamine whether home health care serves as a substitute for inpatient hospital care. This analysis is based on longitudinal (panel) data--observations on states in two time periods--which enable the reduction or elimination of biases that arise from use of cross-sectional data. This study finds that states that had higher home health care employment growth during the period 1998-2008 tended to have lower hospital employment growth, controlling for changes in population. Moreover, states that had higher home health care payroll growth tended to have lower hospital payroll growth. The estimates indicate that the reduction in hospital payroll associated with a $1,000 increase in home health payroll is not less than $1,542, and may be as high as $2,315. This study does not find a significant relationship between growth in utilization of home health care and growth in utilization of nursing and residential care facilities. An important reason why home health care may serve as a substitute for hospital care is that the availability of home health care may allow patients to be discharged from the hospital earlier. Hospital discharge data from the Healthcare Cost and Utilization Project are used to test the hypothesis that use of home health care reduces the length of hospital stays. Major Diagnostic Categories with larger increases in the fraction of patients discharged to home health care tended to have larger declines in mean length of stay (LOS). Between 1998 and 2008, mean LOS declined by 4.1%, from 4.78 to 4.59 days. The estimates are consistent with the hypothesis that this was entirely due to the increase in the fraction of hospital patients discharged to home health care, from 6.4% in 1998 to 9.9% in 2008. The estimated reduction in 2008 hospital costs resulting from the rise in the fraction of hospital patients discharged to home health care may have been 36% larger than the increase in the payroll of the home health care industry.

The effect of pharmaceutical innovation on longevity: Evidence from the U.S. and 26 high-income countries.

This study examines the impact that pharmaceutical innovation, which accounts for most private biomedical research expenditure, has had on longevity. We perform two types of two-way fixed-effects analyses, which control for the effects of many potentially confounding variables. First, we analyze long-run (2006-2018) changes in longevity associated with different diseases in a single country: the U.S. Then, we analyze relative longevity levels associated with different diseases in 26 high-income countries during a single time period (2006-2016). The measure of longevity we analyze, mean age at time of death, is strongly positively correlated across countries with life expectancy at birth. The measure of pharmaceutical innovation we use is the mean vintage (year of initial world launch) of the drugs used to treat each disease in each country. Changes in the vintage distribution of drugs are due to both entry of new drugs and exit of old drugs. Our analysis of U.S. data indicates that the diseases for which there were larger increases in drug vintage tended to have larger increases in the longevity of Americans of all races and both sexes. In other words, the lower the mean age of the drugs, the higher the mean age at death. We test, and are unable to reject, the "parallel trends" hypothesis. We estimate that the 2006-2018 increase in drug vintage increased the mean age at death of Americans by about 6 months (66% of the observed increase). Controlling for sex, race, and education has only a small effect on the estimate of the vintage coefficient. The estimates indicate that drug vintage did not have a significant effect on the mean age at death of decedents with less than 9 years of education. Drug vintage had a positive and significant effect on the mean age at death of decedents with at least 9 years of education, and a larger effect on the mean age at death of decedents with at least 13 years of education. The finding that pharmaceutical innovation has a larger effect on the longevity of people with more education is consistent with previous evidence that more educated people are more likely to use newer drugs. Our analysis of data on 26 high-income countries indicates that the higher the vintage of drugs available to treat a disease in a country, the higher mean age at death was, controlling for fixed disease and country effects. The increase in drug vintage is estimated to have increased mean age at death in the 26 countries by 1.23 years between 2006 and 2016-73% of the observed increase. We obtain estimates of the cost of pharmaceutical innovation-its impact on drug expenditure-as well as estimates of an important benefit of pharmaceutical innovation-the number of life-years gained from it-and of their ratio, i.e., the incremental cost-effectiveness ratio. Estimates of the cost per life-year gained for the U.S. and the 26 countries are $35,817 and $13,904, respectively. Both figures are well below per capita GDP in the respective regions, suggesting that, overall, pharmaceutical innovation was highly cost-effective.

The quality of medical care, behavioral risk factors, and longevity growth.

The rate of increase of longevity has varied considerably across U.S. states since 1991. This paper examines the effect of the quality of medical care, behavioral risk factors (obesity, smoking, and AIDS incidence), and other variables (education, income, and health insurance coverage) on life expectancy and medical expenditure using longitudinal state-level data. We examine the effects of three different measures of the quality of medical care. The first is the average quality of diagnostic imaging procedures, defined as the fraction of procedures that are advanced procedures. The second is the average quality of practicing physicians, defined as the fraction of physicians that were trained at top-ranked medical schools. The third is the mean vintage (FDA approval year) of outpatient and inpatient prescription drugs. Life expectancy increased more rapidly in states where (1) the fraction of Medicare diagnostic imaging procedures that were advanced procedures increased more rapidly; (2) the vintage of self- and provider-administered drugs increased more rapidly; and (3) the quality of medical schools previously attended by physicians increased more rapidly. States with larger increases in the quality of diagnostic procedures, drugs, and physicians did not have larger increases in per capita medical expenditure. We perform several tests of the robustness of the life expectancy model. Controlling for per capita health expenditure (the "quantity" of healthcare), and eliminating the influence of infant mortality, has virtually no effect on the healthcare quality coefficients. Controlling for the adoption of an important nonmedical innovation also has little influence on the estimated effects of medical innovation adoption on life expectancy.

The Impact of Biopharmaceutical Innovation on Disability, Social Security Recipiency, and Use of Medical Care of U.S. Community Residents, 1998-2015.

This study seeks to analyze the overall impact that biopharmaceutical innovation had on disability, Social Security recipiency, and the use of medical services of U.S. community residents during the period 1998-2015. We test the hypothesis that the probability of disability, Social Security recipiency, and medical care utilization associated with a medical condition is inversely related to the number of drug classes previously approved for that condition. We use data from the 1998-2015 waves of the Medical Expenditure Panel Survey and other sources to estimate probit models of an individual's probability of disability, Social Security recipiency, and medical care utilization. The effect of biopharmaceutical innovation is identified by differences across over 200 medical conditions in the growth in the lagged number of drug classes ever approved. 18 years of previous biopharmaceutical innovation is estimated to have reduced: the number of people who were completely unable to work at a job, do housework, or go to school in 2015 by 4.5%; the number of people with cognitive limitations by 3.2%; the number of people receiving SSI in 2015 by 247 thousand (3.1%); and the number of people receiving Social Security by 984 thousand (2.0%). Previous innovation is also estimated to have caused reductions in home health visits (9.2%), inpatient events (5.7%), missed school days (5.1%), and outpatient events (4.1%). The estimated value in 2015 of some of the reductions in disability, Social Security recipiency, and use of medical care attributable to previous biopharmaceutical innovation ($115 billion) is fairly close to 2015 expenditure on drug classes that were first approved by the FDA during 1989-2006 ($127 billion). However, for a number of reasons, the costs are likely to be lower, and the benefits are likely to be larger, than these figures.

The impact of pharmaceutical innovation on the longevity and hospitalization of New Zealand cancer patients, 1998-2017.

BACKGROUND: We investigate whether the cancer sites that experienced more pharmaceutical innovation in New Zealand had larger subsequent declines in premature mortality and hospitalization rates and larger subsequent increases in 5-year survival rates, controlling for changes in incidence. RESEARCH DESIGN AND METHODS: We estimate the effects of the number of WHO ATC5 chemical substances and ATC4 chemical subgroups approved on the number of years of potential life lost before ages 85, 75, 65, 5-year relative survival rates, and the number of inpatient hospital discharges, by estimating difference-in-differences (2-way fixed-effects) models using aggregate longitudinal data on 23 cancer sites. RESULTS: Substances/subgroups approved during 1985-2001 reduced the number of years of potential life lost before age 85 (YPLL85) in 2017 by 67%. Those substances/subgroups reduced YPLL75 and YPLL65 in 2017 by similar percentages. The odds of surviving at least 5 years after diagnosis are significantly positively related to the number of substances previously approved. CONCLUSIONS: The cost per life-year before age 85 gained in 2017 from previous drug approvals did not exceed 1719 USD. The WHO considers interventions whose cost per quality-adjusted life-year gained is less than per capita GDP to be highly cost-effective; New Zealand's per capita GDP in 2017 was 42,260 USD. capita GDP in 2017 was 42,260 USD. EXPERT OPINION: Pharmaceutical innovation-the introduction and use of new drugs-substantially increased cancer survival rates in New Zealand, and substantially reduced premature (before ages 85, 75, and 65) cancer mortality there during the period 1998-2017. Moreover, overall the new cancer drugs were highly costeffective. The drugs approved during 1985-2001 are estimated to have reduced the number of years of potential life lost before age 85 in 2017 by 244,876. Even if previous drug approvals increased the cost of hospital discharges and other medical costs, the cost per life-year before age 85 gained in 2017 from those approvals could not have exceeded 1719 USD.

How cost-effective are new cancer drugs in the U.S.?

Introduction: More than 8 times as many new cancer drugs were approved during 2005-2015 as were approved during 1975-1985 (66 vs. 8). The average annual 2010-2014 growth rate of U.S. cancer drug expenditure was 7.6%. This has contributed to a lively debate about the value and cost-effectiveness of new cancer drugs.Areas covered: We assess the average cost-effectiveness in the U.S. in 2014 of new cancer drugs approved by the FDA during 2000-2014, by performing an original econometric investigation (rather than a literature review) of whether there were larger declines in premature mortality and hospitalization, and larger increases in survival, from the cancers that had larger increases in the number of drugs ever approved, controlling for the change in cancer incidence and mean age at time of diagnosis.Expert opinion: Cancer drugs approved during 2000-2014 are estimated to have reduced the number of potential years of life lost before age 75 in 2014 by 719,133. Cancer drugs approved during 1989-2005 are estimated to have reduced hospital cost in 2013 by $4.8 billion. Our baseline estimate of the cost per life-year gained in 2014 from cancer drugs approved during 2000-2014 is $7853.

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.

Have newer cardiovascular drugs reduced hospitalization? Evidence from longitudinal country-level data on 20 OECD countries, 1995-2003.

This study examines the effect of changes in the vintage distribution of cardiovascular system drugs on hospitalization and mortality due to cardiovascular disease using longitudinal country-level data. The vintage of a drug is the first year in which it was marketed anywhere in the world. We use annual data on the utilization of over 1100 cardiovascular drugs (active ingredients) in 20 OECD countries during the period 1995-2003. Countries with larger increases in the share of cardiovascular drug doses that contained post-1995 ingredients had smaller increases in the cardiovascular disease hospital discharge rate, controlling for the quantity of cardiovascular medications consumed per person, the use of other medical innovations (computed tomography scanners and magnetic resonance imaging units), potential risk factors (average consumption of calories, tobacco, and alcohol), and demographic variables (population size and age structure, income, and educational attainment). The estimates also indicate that the use of newer cardiovascular drugs has reduced the average length of stay and the age-adjusted cardiovascular mortality rate, but not the number of potential years of life lost due to cardiovascular disease before age 70 per 100,000 population. The estimates indicate that if drug vintage had not increased during 1995-2004, hospitalization and mortality would have been higher in 2004. We estimate that per capita expenditure on cardiovascular hospital stays would have been 70% ($89) higher in 2004 had drug vintage not increased during 1995-2004. Per capita expenditure on cardiovascular drugs would have been lower in 2004 had drug vintage not increased during 1995-2004. However, our estimate of the increase in expenditure on cardiovascular hospital stays is about 3.7 times as large as our estimate of the reduction in per capita expenditure for cardiovascular drugs that would have occurred ($24).

The impact of pharmaceutical innovation on the burden of disease in Canada, 2000-2016.

We perform an econometric assessment of the role that pharmaceutical innovation-the introduction and use of new drugs-has played in reducing the burden of disease in Canada, by investigating whether diseases for which more new drugs were launched had larger subsequent reductions in disease burden. Since utilization of a drug reaches a peak about 12-14 years after it was launched, we allow for considerable lags in the relationship between new drug launches and the burden of disease. We analyze the impact of new drug launches on a comprehensive measure of disease burden-the age-standardized disability-adjusted life-years lost (DALY) rate-and on its two components: the age-standardized years of life lost (YLL) and years lost to disability (YLD) rates. We also analyze the impact of new drug launches on the number of hospital discharges and on the average length of hospital stays. The number of DALYs lost is significantly inversely related to the number of drugs that had ever been launched 9-20 years earlier, and the number of YLLs is significantly inversely related to the number of drugs that had ever been launched 11-20 years earlier. The launch of a drug has the largest (most negative) impact on the number of DALYs and YLLs 15 years after it was launched. The estimates indicate that if no drugs had been launched during 1986-2001, the age-standardized DALY rate would not have declined between 2000 and 2016; it might even have increased. Almost all (93%) of the reduction in DALYs was due to a reduction in YLL. The estimates imply that new drug launches during 1986-2001 reduced DALYs in 2016 by 21%, reduced YLLs in 2016 by 28%, and reduced YLDs in 2016 by 3%. We estimate that drugs launched during 1986-2001 reduced the number of DALYs lost in 2016 by 2.31 million. Expenditure in 2016 on drugs launched during 1986-2001 per DALY gained in 2016 from those drugs was 2842 USD. Interventions that avert one DALY for less than average per capita income for a given country or region are generally considered to be very cost-effective; Canada's per capita GDP was 42,158 USD in 2016, so our estimates indicate that the new drugs launched during 1986-2001 were very cost-effective, overall. Moreover, 2842 USD may be an overestimate of the true net cost in 2016 per DALY of drugs launched during 1986-2001. A previous study based on U.S. data showed that about 25% of the cost of new drugs is offset by reduced expenditure on old drugs. Also, our estimates indicate that, if no drugs had been launched during 1986-2001, the average length of 2016 hospital stays would have been about 16% higher. The reduction in hospital expenditure due to shorter average length of stay may have been larger than the expenditure on the drugs responsible for shorter hospital stays.

How many life-years have new drugs saved? A three-way fixed-effects analysis of 66 diseases in 27 countries, 2000-2013.

BACKGROUND: We analyzed the role that the launch of new drugs has played in reducing the number of years of life lost (YLL) before three different ages (85, 70 and 55 y) due to 66 diseases in 27 countries. METHODS: We estimated two-way fixed-effects models of the rate of decline of the disease- and country-specific age-standardized YLL rate. The models control for the average decline in the YLL rate in each country and from each disease. RESULTS: One additional drug launch 0-11 y before year t is estimated to have reduced the pre-age-85 y YLL rate (YLL85) in year t by 3.0%, and one additional drug launch ≥12 y before year t is estimated to have reduced YLL85 by 5.5%. (A drug's utilization peaks 8-10 y after it is launched.) Controlling for the number of drugs previously launched, YLL rates are unrelated to the number of drug classes previously launched. CONCLUSIONS: The estimates imply that, if no new drugs had been launched after 1981, YLL85 in 2013 would have been 2.16 times as high as it actually was. We estimated that pharmaceutical expenditure per life-year saved before age 85 y in 2013 by post-1981 drugs was $2837. This amount is about 8% of per capita GDP, indicating that post-1981 drugs launched were very cost-effective overall. But the fact that an intervention is cost-effective does not necessarily mean that it is 'affordable.'