The Resistance Phenomenon in Microbes and Infectious Disease Vectors Implications for Human Health and Strategies for Containment: Workshop Summary (2003) / Chapter Skim
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4. The Economics of Resistance
4. The Economics of Resistance
Pages 107-129
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From page 107... ...
This is the most basic level of analysis, but nonetheless important in providing foundational information on which further analysis is based, as well as providing information on the consequence of choices that have already been made. In this regard, various economic analyses indicate that antimicrobial resistance greatly increases the cost of health care, in a variety of ways.
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From page 108... ...
For the United States as a whole, the American Society for Microbiology estimated in 1995 that health care costs associated with treatment of resistant infections amounted to more than $4 billion annually. And this figure significantly underestimates the actual cost of resistance, since it includes only direct health care costs and excludes an array of other costs, such as lost lives and lost workdays.
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From page 109... ...
, of the rising prevalence of resistance, there is little evidence that the use of antimicrobials is changing. The potential impact of this increasing antimicrobial resistance on health care expenditure and population morbidity and mortality is causing professional, government, and public concern (House of Lords Select Committee on Science and Technology, 1998; Standing Medical Advisory Committee Sub-Group on Antimicrobial Resistance, 1998; American Society for Microbiology, 1995; OTA, 1995; World Health Organization tWHO]
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From page 110... ...
First, economics may provide purely "descriptive" analysis, quantifying the phenomena which are of interest, such as national expenditure on health care, how much AMR costs a hospital, and so on. This is the most basic level of analysis, but nonetheless an important one in providing founclational information on which further analysis is based, as well as provicling information on the consequence of choices that have already been macle.
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From page 112... ...
However, it is undoubtedly the case that many of the major effects of resistance are likely to be incurred by future generations, and policy decisions will therefore have to weigh current costs and benefits against those occurring to future generations. Third, there is the obvious implication that one needs to assess all the relevant costs and benefits (direct and externality)
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From page 113... ...
. More recent estimates suggest that, for the United States, the continued rise in use of antimicrobials has resulted in current costs of more than $7 billion annually, with up to $4 billion used for the treatment of nosocomial infections due to AMR bacteria (John and Fishman, 1997~.
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From page 114... ...
A recent systematic literature review of studies assessing the cost and/or effectiveness of interventions specifically aimed at reducing the emergence and transmission of AMR, found only 127 studies of moderate to good quality, of which 68 were effectiveness studies, 10 economic evaluations, 2 cost studies, and 2 modeling studies (Smith et al., 2001; Wilton et al., 2002~. The main conclusions of this study were that most studies: .
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From page 115... ...
Thus there may be a value attached to maintaining the option to benefit from antimicrobials in the future which would not be captured by valuations of the health impacts of different policies alone. Development of Specific Economic Strategies/Policies to Contain AMR The conceptualization of AMR as a negative externality allows the consideration of economic strategies (i.e., strategies designed to change incentive structures)
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From page 116... ...
This approach stresses, first, the importance of optimization and balance in the use of antimicrobial products, and thus in the level of AMR which exists, rather than eradication of AMR, and, second, the importance of this optimization and balance being one to be struck over time: that the balance is really against the (costs and benefits off use of antimicrobial treatments now and their continued availability for use in the future. Informing the policy options for the containment of AMR will thus require information relevant to these issues.
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From page 117... ...
assessing the optimal use of antimicrobial drugs is essential for evaluating viable policy alternatives and prioritizing resource allocation between them. However, the single biggest problem faced in the assessment of the economic impact of AMR, and the assessment of the cost and effectiveness of interventions to reduce the emergence and transmission of AMR, is the lack of a coherent and comprehensive economic mode!
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From page 118... ...
. Conclusion Although further developments are undoubtedly required, economics can assist in clarifying the basis for policy development, can identify and develop policy options and, through the assessment of the cost and benefits of alternative options, can help to recognize optimal policy solutions.
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From page 119... ...
When dealing with a large population of individuals using drugs, the price mechanism seems to have important advantages over quotas. For one thing, many individuals will not need to use the drug, so allocating a fixed number of units to them, and the same number to an individual in dire need, is inefficient.
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From page 120... ...
. The reason that increasing the prescription price may reduce completion rates is that individuals who expect to contract the illness again will have an incentive to save some of the medication as a contingency against such an event.
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From page 121... ...
3Although this may appear efficient (because it takes a higher fine to stop a rich person speeding than to stop a poor person) , if the objective is to reduce total speeding, and not any particular person's, it would be better to levy a fee independent of income.
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From page 122... ...
These could also include measures to encourage the use of an economically efficient variety of drugs. On the supply side, measures to address the resistance problem would include incentives that not only encourage drug firms to develop new antibiotics, but also give them a greater incentive to care about the impact of drug resistance.
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From page 123... ...
Non-Price Measures While price measures could be effective in lowering antibiotic use, their effectiveness may be enhanced when used in combination with non-price measures as part of an overall strategy to fight resistance. Increasing patient awareness of the drawbacks of antibiotic use and improving physician education could promote judicious antibiotic use; much has been written 5some economists have proposed tradable permits for resistance that would work in much the same way as tradable permits for pollution.
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From page 124... ...
Treatment heterogeneity refers to the policy option of treating different patients afflicted with the same disease with antibiotics that have unrelated modes of action. The rationale for treatment heterogeneity follows from the notion that the likelihood that bacteria will develop resistance to any single antibiotic can be reduced by treating fewer patients with that antibiotic.
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From page 125... ...
However, treatment heterogeneity necessarily requires the availability of a variety of drugs, and this may require regulatory intervention. Supply Side While increasing treatment heterogeneity and lowering the demand for unnecessary antibiotics through both price and non-price measures comprise one side of the solution, the other side deals with increasing incentives for pharmaceutical firms to increase research spending on new antibiotics as well as to care about resistance to existing drugs.
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From page 126... ...
The third reason for increasing patent breadth is that we attain the basic objective of focusing new drug research on increasing the variety of modes of action of antibiotics. Variety has social value that is not fully compensated for in the current market for antibiotics, and increasing patent breadths would encourage variety (Ellison and Hellerstein, 1999~.
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From page 127... ...
Patient and physician education, better surveillance data, increasing antibiotic heterogeneity, providing warning labels on antibiotics are all part of the policy response mix. However, they are likely to be ineffective without a compelling economic incentive for patients and physicians to face the cost they impose on the rest of society in the form of resistance when they use or .
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From page 128... ...
1998. Using Antibiotic Resistance Surveillance Data in the Optimal Treatment of Acute Otitis Media.
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From page 129... ...
1995. The Clean Air Act's sulfur dioxide emissions market: estimating the costs of regulatory and legislative intervention.
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