MODULE 1 COMP102

purchased. As long as the circumstances of the

Overview of Pharmacoeconomics consumer don’t change materially, the inverse
relationship holds.
Economics
- If the price of a branded drug goes up, an
- It is the study of scarcity, the study of how
alternative drug or even a generic can
people use resources and respond to incentives,
substitute. This is referred as the
or the study of decision making.
SUBSTITUTION EFFECT.
- It can find ways of reconciling unlimited wants
- When the price of a commodity goes down,
with limited resources.
demand goes up.
- An increase in population size affects demand,
Economic efficiency
too. More consumers result in a higher demand
- It is defines as “Producing at a point at which
for all goods or services.
average product is maximized and average
variable cost is minimized.” The Law of Supply
- The quest for economic efficiency stems from
- There is a direct relationship between the
the fact that there are never enough resources
amount of a commodity that a producer will
to provide all the goods and services desire by a
make available and the reward that is received.
society.
- Higher prices increase the availability of an item.
- This concept is called SCARCITY.
At lower prices, less will be available.
- The economic concept of COST stems from the
notion that resources have alternative uses (i.e., Supply & Demand Equilibrium
Money spent in a rehabilitation program for drug
- Equilibrium prices is the market price that exists
addicts is not available to be spent on prenatal
when the quantity demanded equal the quantity
care for indigent women.)
supplied.
- OPPUTUNITY COST is defines as the potential
benefit that could have been received if the Pharmacoeconomics
resources have been used in their next-best
- It is the description and analysis of the costs of
alternative.
drug therapy to health care systems and society.
- Adopting the concept of economic efficiency
- It identifies, measures and compares the costs
implies that choices should be made in a way
and consequences of pharmaceutical products
that maximizes the total benefit from the
and services.
available resources.

Economic optimization Basic Pharmacoeconomic Equation

 Costs- Represents the inputs used to obtain
- When more than 1 alternative is available, the
and use the pharmaceutical product or services.
optimal choice produces an outcome that is
 Rx - represents the drug product or service
most consistent with the decision maker’s stated
being assessed
objectives.
 Outcome – represents the health-related
- Constrained optimization takes into
outcomes produced by the pharmaceutical
consideration the cost and availability of
product or service.
resources (i.e., with an increase in patient
volumes, should physicians in a small group 4 Basic Types of Pharmacoeconomic studies
practice hire an office manager, an additional
nurse, or both?) 1. Cost-Minimization Analysis
- Only the costs of the intervention are
The Law of Demand compared because the outcomes are
- There is an inverse relationship between the assumed to be equivalent
amount of a commodity that a person will - Cannot be used when outcomes of
purchase and he sacrifice that must be made to interventions are different
obtain it. - Example: comparing two generic
- When the price of an item is high, your purchase medications that are rated as equivalent by
less, and when the price is lower, more is the FDA
 2. Cost-effectiveness analysis to every Filipino of the highest possible quality of
- Measures outcomes in natural units (e.g., health care that is accessible, efficient, equitably
mmHg, cholesterol levels, symptom-free distributed, adequately funded, fairly financed,
days [SFDs], years of life saved) and appropriately used by an informed and
- Outcomes are routinely collected in clinical empowered public”.
trials and in clinical practice
- Programs with different types of outcomes RA 11223 Universal Health Care Act
cannot be compared.
Objectives:

1. Progressively realize universal health care in the

country through a systemic approach and clear
delineation of roles of key agencies and
stakeholders towards better performance in the
health system
2. Ensure that all Filipinos are guaranteed
equitable access to quality and affordable health
care goods and services, and protected against
financial risk.

Health Technology
- A health technology is the application of
organized knowledge and skills in the form of
devices, medicines, vaccines, procedures and
systems developed to solve a health problem
3. Cost-Utility Analysis and improves quality of lives.
- Measures outcomes based in years of life
that are adjusted by “utility” weights, which Health Technology Assessment
range from 1.0 for “perfect health” to 0.0 for
“dead”. Utility weighs incorporate patient or - As defined in RA 11223, Health Technology
society preferences for specific health Assessment (HTA) refers to the systematic
states. evaluation of properties, effects or impact of
- No consensus on how to measure these health-related technologies, devices, medicines,
utility weights, and they are more of a vaccines, procedures and all other
“rough estimate” that a precise measure. health0related systems developed to solves a
4. Cost-Benefit Analysis health problem and improves quality of lives and
- Not only are cost valued in monetary terms, health outcomes, utilizing a multidisciplinary
but also the benefits process to evaluate the social, economic,
- Can determine whether the benefit of a organizational, and ethical issues a health
program or intervention exceed the costs of intervention or health technology.
implementation & can compare multiple - As defined by the WHO, HTA refers to the
programs or interventions with similar or systematic evaluation of properties, effects,
unrelated outcomes. and/or impacts of health technology. It is a
multidisciplinary process to evaluate the social,
UNIVERSAL HEALTH COVERAGE economic, organizational and ethical issues of a
health intervention or health technology. The
- As defined by the WHO, Universal health main purpose of conducting an assessment is to
coverage means that all people have access to inform a policy decision making.
the health services they need, when and there - HTA covers both the direct, intended
they need them, without financial hardships. It consequences of technologies and interventions
includes the full range of essential health and their indirect, unintended consequences.
services, from health promotion to prevention, - The HTA approach is used to inform policy and
treatment, rehabilitation and palliative care. decision-making in healthcare, especially on
how best to allocate limited funds to health
Kalusugang Pangkalahatan interventions and technologies. The assessment
is conducted by interdisciplinary groups, using
- Universal Health Cure (UHC), also referred as explicit analytical frameworks, drawing on
Kalusugan Pangkalahatan (KP), is the “provision
 clinical, epidemiological, health economic and of needed orientation and training programs for
other information and methodologies. newly appointed members of the HTAC

HTA Council (HTAC) Policy Planning & Evaluation Team

- HTAC is an independent advisory body created - Responsible for the overall management of the
under the RA 11223 recommends which health health technology assessment and appraisal
technologies the DOH and the Philippine Health program including internal assessments
Insurance Corporation (PHIC) may fund especially when immediate policy advice is
- The members of the council include practitioners needed, the development of normative
of ethics, public health, medical law and health guidelines and engagement with stakeholders at
economy, sociology, evidence-based medicine, all stages of the appraisal.
vaccines, devices, procedures, and other health
technologies. Other Participants in the HTA Process
 Department of Health – Leads health sector in
the institutionalization of the HTA process as a
fair and transparent priority setting mechanism
that shall be recommendatory to the DOH and
PhilHealth for the development of a range of
entitlements such as drugs, medicines,
pharmaceutical products and other devices.
HTA Organizational Framework  Philippine Health Insurance Corporation –
Designs national health insurance benefit
Core Committee package and finance packages based on the
positives recommendations of HTAC
- It is responsible for the development and  Food and Drug Administration –
submission of final recommendations to policy- Provides/shares relevant clinical evidence with
and decision-makers, based on the evidence the HTAC on the safety and efficacy of medical
appraisal of the different subcommittees. products under its jurisdiction including pre-
- It is composed of 9 voting members marketing and post-marketing regulatory
- The committee approves the agenda of the assessments
HTAC meetings in consultations with the HTA  Philippines Institute of Traditional and
office Director and the HTA Technical Alternative Healthcare - provides/shares
Secretariat; and ensures that the equality of the relevant traditional medicines health outcomes,
evaluations submitted by the Assessment costing and data collected from
Teams to the HTAC adheres to the agreed researches/studies/documentation funded or
methodological standards. conducted.
 Price Negotiation Board – Coordinates with
Subcommittees the HTAC in determining the clinical and
economic value of new health technologies as
- They support the HTA Core Committee in one of the bases of prices negotiation
achieving a timely, effective, efficient and arrangement with the industry
responsive technology appraisal process by  Assessment teams – perform assessment of
performing the initial review of HTA reports and health technologies following the methodological
submissions of the industry, Assessment Teams standards set the DOH/HTAC. They may be
and other actors which submit, evidence to the internal or external teams
HTA Council for purposes of technology  Industry – Individual manufacturers/companies
appraisal. have to submit all relevant clinical and economic
- All subcommittees shall have a minimum of 1 evidence as required by the HTAC, whether
and maximum of 3 non-voting members for each published or unpublished.
subcommittee.  Academe – provides scientific advice to the
HTA office and HTAC on appropriate
Technical Secretariat Team methodological standards that could applied in
- They shall provide the HTAC w/ the necessary the assessment and appraisal of health
information and resources for discharging its technologies; serve as peer reviewer or co-
duties under the UHC Law including the conduct investigator for internal evaluations
AO 2020-0041 2. Topic Prioritization
- Refers to the selection of topics through a
- The New Implementing Guidelines on Health standard set of criteria by HTAC to ensure that
technology Assessment to Guide Funding the appraisal process responds to the priority
Allocation and Coverage Decisions in support health care needs of the country and that the
Universal Health Care topics address conditions that are important to
patients, health care providers, Philhealth and
General Objective DOH program managers, hospitals and local
- This order aims to define the overall health systems administrators.
institutionalization and implementation  Criteria for prioritization (for existing health
framework for HTA through the Process and technologies)
Methods Guides, as a priority setting a) Budget impact to DOH and PhilHealth
mechanism that shall be recommendatory to b) Total users of health technology
DOH and PHIC in their coverage and funding c) Cost-effectiveness
allocation for UHC. d) Severity of disease
e) Equity, ethical and social implications
HTA Process Guides  Criteria for prioritization (for new health
technologies)
- It refers to the document that provides the a) Total users of health technology
detailed processes involved in the b) Severity of disease
implementation of the HTA which are embedded c) Estimated household financial impact
with mechanisms to incorporate the HTA d) Equity, ethical and social implications
process principles as outlined in the UHC Act. It e) National health services needs
also covers the operational procedures and 3. Scoping & Protocol Development
governance of the HTAC - Scoping refers to the process of defining the
overall scope of the technology assessment in
HTA Methods Guide terms of at least 6 major components:
a) Population of patients who will benefit
- It refers to the document that provides standard from the intervention
methods of conducting HTA to generate b) Health technology or intervention of
evidence which will become that basis of HTAC interest
recommendations to the decision-makers. c) Appropriate comparators relevant to the
local practice of context
HTA PROCESS d) Clinically meaningful outcomes
1. Topic Nomination e) Study design
- It is the process of referring topics to HTAC for f) Any other consideration that will likely
which technology appraisals may be produced impact the results of the assessment
and disseminated for the guidance for policy- such as appropriate perspective,
makers in healthcare coverage decisions and to equity/legal/social issues, time horizon
health providers and patients in the optimal and for the analysis, among others.
appropriate use of health technologies. 4. Topic Assessment
- New and potentially innovative health - It refers to the application of formal scientific
technologies which responds to unmet or priority methods of evidence synthesis to assess the
health care needs in the local Philippine content clinical, economic, health, system, ethical, legal
may also be submitted for HTAC appraisal by and other social impact of covering or
relevant industries with the required clinical, disinvesting a particular health technology in the
social and economic evidence. local Philippines context.
- For existing health technologies, a 5. Evidence Appraisal
reassessment may be triggered by the - Appraisal refers to the process by which the
emergence of new clinical evidence that may HTAC evaluates and makes a judgment on the
have an impact in the previous recommendation value of a health technology in the Philippine
of HTAC. context using its established criteria based in the
- The following document shall be required prior evidence presented by the Subcommittees
to the acceptance of the application. supported by the HTA output of the Assessment
(1) Certificate of Product Registration for drugs Teams
and vaccines - A face to face public consultation shall be
(2) Certificate of Free Sale for medical devices conducted. Once the output of the Assessment
Team is approved, they shall developed an
 evidence summary to be presented to the HTA health interventions that are part of the benefit
Core Committee for final deliberation and packages of PhilHealth for final decision-making.
recommendation - Drugs and vaccines that are approved by the
 The evidence of the summary must include: Secretary of Health and/or PhilHealth Board of
a) Background Directors shall be listed in the Philippine
b) Description of the new health technology National Formulary.
and comparator 9. Dissemination
c) Clinical effectiveness and safety - The HTA Unit shall develop and publish the
d) Economic evaluation communication materials, policy briefs and
e) Health system implications evidence summaries for healthcare
f) Legal, ethical, social issues if any. professionals, patients and policy makers on the
6. Initial Recommendation appropriate use of the health technologies
- The Chair of the Subcommittee or another based on the appraisal and recommendations of
designated Committee member with the support the HTA core committee.
of the Assessment Team shall present to the - The HTAC shall review and finalize the content
HTA Core Committee the evidence summary for of the communication materials before public
the assessed health technology, highlighting the dissemination.
important pieces of evidence considered as well 10. Topic Nomination & Prioritization
as the Subcommittee conclusions on whether - The request for an expedited process must
the said health technology warrants a positive or emanate from the Secretary of Health, following
negative recommendation. the declaration of a public health emergency.
- The HTA Core Committee shall deliberate on Directors of the DOH national health programs
the evidence presented arriving at a judgement shall submit the following documents to facilitate
and recommendation on the public funding and the review process as verified and endorsed by
use of the health technology in the health the Secretary of Health.
system.  Accomplished proposal form
 Criteria in developing recommendations:  FDA marketing authorization or WHO
a) Responsiveness to disease magnitude, certification of prequalification for drugs
severity and equity and medicines
b) Safety and effectiveness  Other relevant documents
c) Household Financial Impact - The decision to use the expedited process is the
d) Cost-effectives responsibility of the HTAC which shall act on the
e) Affordability and viability request/petition of the SOH within 7 days of
7. Resolution receiving the request for an expedited review of
- An appeal may be submitted to the HTA a health technology.
Technical Secretariat within 10 working days 11. Development & Assessment
from posting of the HTAC Core Committee - The HTA office shall extend all assistance to
recommendation, if there is new data that was HTAC through fast track evidence assessment
not part of the initial submission and may impact supported by internal or external assessment
the recommendation of the HTAC. The appeal teams which shall conduct a rapid review hat
shall be decided within 15 working days from should be completed within 2-12 weeks of the
receipt of the documents. request/petition for an expedited review process.
- For certain changes, the study shall be revised 12. Evidence Appraisal
accordingly and assessed by the HTAC - The HTAC shall evaluate the health technology
Subcommittee on the same basis as stated and recommended its use based on the
above. The revised technical report following criteria:
incorporating the new studies shall be presented  The health technology has been
to the Subcommittee for further assessment and approved for marketing and use by the
appraisal prior to presentation to the HTA Core Philippines FDA, when applicable
Committee.  There is no other better or existing
8. Decision by Secretary of Health health intervention that can address the
- The Chair of the HTA Core Committee through particular condition/situation
the Secretariat shall transmit the  The health intervention shall be used for
recommendation of the Committee to the a current public health emergency or
Secretary of Health for interventions which fall imminent health threat that could affect
under the remit of the specific health programs a sizeable population as defined in the
at the DOH and PhilHealth Board of Directors for UHC Act.