Analysis shows Ontario gets twice as much back in benefits as it spends
for commonly prescribed pharmaceutical treatments
OTTAWA, July 11, 2013 /CNW/ - The money spent on pharmaceutical
treatment in Ontario more than pays off in savings for the health
system and improved productivity for the economy, according to a
Conference Board of Canada analysis. This report, Reducing the Health Care and Societal Costs of Disease: The Role of
Pharmaceuticals, quantifies how pharmaceutical treatment affects both direct health care
costs and society more broadly.
"Public health care in Canada is under pressure to rein in rising costs,
and drugs have been identified as a target in reducing costs. But our
empirical research suggests that when it comes to certain conditions,
pharmaceutical treatments offer benefits in reducing health-related
complications and lowering the incidence of disease," said Louis Thériault, Director, Health Economics, for the Conference Board's Canadian Alliance for Sustainable Health Care.
In 2012, the health and societal benefits in Ontario amounted to twice
the amount spent on pharmaceuticals in the six drug classes assessed in
Getting patients to better comply with their prescribed drug therapy and
encouraging the development of new drugs can offset, or even lower,
overall health care spending.
Innovation in the pharmaceutical industry can boost the output of an
economy by reducing lost productivity due to disease and sickness.
This analysis examines pharmaceutical treatments involving six drug
classes (and the conditions they are used to treat):
Angiotensin-converting enzyme (ACE) inhibitors - (high blood pressure
Statins - (high cholesterol)
Biguanides - (diabetes)
Biological response modifiers - (rheumatoid arthritis);
Inhaled steroids - (asthma)
Prescription smoking cessation aids
In Ontario, public, private and out-of-pocket expenses for these six
drug classes totaled $1.22 billion last year. The Conference Board
analysis calculated the impact of these treatments on overall health
care costs (including drugs, physicians and hospitals) and on other
costs to society (including short and long-term disability, early
mortality and lost productivity specifically due to disease). The total
economic benefit attributed to treatment from these six classes of
drugs was nearly $2.44 billion in 2012.
Between 2007 and 2012, the analysis found both the absolute and relative
health and societal benefits increased vis-à-vis costs in Ontario.
Among the six classes of drugs, pharmaceuticals used to treat diabetes,
high blood pressure, high cholesterol, and asthma produced benefits
that outweighed their costs.
During this 2007-2012 period, benefits did not fully offset the costs in
the classes of drugs covering rheumatoid arthritis treatment and
prescription smoking cessation. For rheumatoid arthritis patients,
biological response modifiers represent a new and effective class of
drug, but treatment costs remain very high. For prescription smoking
cessation aids, the benefits take longer to materialize than many other
classes of drugs, according to the analysis.
The economic assessment of pharmaceutical treatments covers the recent
historical period (2007-2012); it also provides future projections from
2013 to 2030 under three different scenarios. In all three future
scenarios, the benefits outweighed the costs - overall and in all six
classes of drugs (including those for rheumatoid arthritis and smoking
cessation aids). The analysis includes both branded and generic
pharmaceuticals in the calculation of costs and benefits.
The report was prepared by the Canadian Alliance for Sustainable Health Care (CASHC) with technical contributions from an advisory group. CASHC
research is funded by more than 30 organizations. This research
received additional funding from Rx&D, Canada's Research- Based
Read a backgrounder for more on the methodology, assumptions and limitations of the
SOURCE: Conference Board of Canada
For further information:
Yvonne Squires, Media Relations, Tel.: 613- 526-3090 ext. 221
The Conference Board of Canada