The recent increase in the number of published economic evaluations has been considerable [Wellcome, 1992; Udvarhelyi et al, 1992]. It is of some concern, however that reviews of economic evaluations have highlighted a high degree of methodological shortcomings in many studies [Adams at al, 1992; Gerard, 1992]. Furthermore, the situation does not appear to have improved over time [Udvarhelyi et al, 1992]. In particular, the importance of dealing systematically and comprehensively with uncertainty appears to have been overlooked by many analysts.
Inequality in health is back on the political agenda in the UK. Three factors have made inequality an issue - firstly, concern that the internal market will enable some, notably patients of GP Fundholders, to get better treatment than other NHS patients, secondly, a revival of interest in community values, bringing with it a recognition of the impact of poverty on life expectancy, and thirdly, greater awareness that health care is being rationed, and will increasingly be so, irrespective of which political party is in Government.
Treatment of children with growth hormone is well recognised under the NHS and its cost (between £5,000-£10,000 per annum per child) has generally been accepted. Since the biotechnologically produced hormone (rhGH) first appeared on the market in 1985 it has been increasingly prescribed by general practitioners at the request of hospital consultants whose pharmacies felt unable to pay the high cost.
These papers were presented to an Office of Health Economics meeting in London in October 1989. The programme for the meeting was put together by a group of international experts interested in the economics of the pharmaceutical industry, and hence it reflects developments in health economics across Europe.
The objectives of this booklet are twofold. First, to describe in simple terms the state of the art in undertaking economic studies to demonstrate the benefits of new and existing medicines. Second, to remind readers why such analyses are of increasing importance both to individual pharmaceutical companies and to the industry as a whole.
In most countries the resources available for health care are increasingly stretched in the face of the competing demands for their use. Therefore health care policy makers, planners and managers have begun to scrutinize all health care procedures and treatments more closely, in order to ensure that they give good value for money. Medicines have not been exempt from this process and there is increased emphasis on demonstrating additional benefit or social value from new medicines that is commensurate with their costs.
The purpose of this book is to review the current state of health economics and look forward to developments over the next 25 years. The coverage is international, individual countries, areas and the World Health Organization, being considered by world experts. Other topics examined include cost-benefit analysis and issues concerning the pharmaceutical industry. The book should represent a major statement of the field, of interest to economists and health planners.
Half a century ago little attention was paid to the risks associated with medical and surgical treatment. The hazards of sickness itself were so obvious, that the considerable risks of medical intervention were more or less taken for granted.
Expenditure on health care is continuing to rise in all Western countries, both in total and as a percentage of gross national product (Table 1). This has underlined the political importance of demonstrating that this expenditure is giving value for money, both in specific instances and in its totality.