An analysis of PBS data and mortality and hospital rates reveals innovative medicines are cost effective Investment in new medicines is worth it, as they pay for themselves in reduced hospital bills alone, a new report finds. The analysis, conducted by American economist Professor Frank Lichtenberg, found that amount of money spent on the PBS […]
An analysis of PBS data and mortality and hospital rates reveals innovative medicines are cost effective
Investment in new medicines is worth it, as they pay for themselves in reduced hospital bills alone, a new report finds.
The analysis, conducted by American economist Professor Frank Lichtenberg, found that amount of money spent on the PBS on “innovative” drugs was overwhelmed by the near $7 billion saved on hospital expenditure.
The report, released by Medicines Australia and funded by MSD, was presented at the National Press Club in Canberra early last week.
In 2011, there was an estimated 60% reduction in premature deaths, before age 75, thanks to innovative medicines. This is equivalent to 140,000 life years saved, the report found.
“Medicines listed on the PBS between 1989 and 2002 cost $5.8 billion in 2011,” Professor Lichtenberg said. “Without these medicines, the cost of hospitalization in 2011 would have been 13% or $6.8 billion higher.”
While premature mortality has been falling in Australia, the distribution across diseases isn’t equal, Professor Lichtenberg wrote.
Heart disease saw a 42% drop in premature mortality, whereas lung cancer only fell by 9%.
This, Professor Lichtenberg attributes to differences in the number of new medicines on the PBS.
It has prompted renewed calls from Hepatitis Australia for the inclusion of new “breakthrough” hepatitis C drugs on the PBS.
“New hepatitis C therapies are the most significant medical innovation in a generation,” CEO Helen Tyrrell said. “These medicines have been ruled to be cost-effective and must be urgently added to the PBS to turn the tide on liver cancer, liver cirrhosis and liver failure.”
