Benefits

Productivity costs Benefits program providers need to show that their programs, like drug programs, contribute to key business drivers including increased productivity and fewer sick days (reducing absenteeism) however, these are not always included in the pharmacoeconomic analysis that are submitted for review. If they are included, they might not be from the private payor perspective. For example, it makes sense to exclude caregiver productivity losses from a private payor perspective because the caregiver and the person with the illness are unlikely to be covered by the same plan sponsor, especially if the patient is an adult. On the other hand, if it is a childhood disease associated with significant morbidity that requires full-time caregiving by a parent, it would be logical to include the caregiver's productivity loss since the child would not be the one occupying employment. It is noted that, from a societal perspective, both the patient and the caregiver's productivity would be relevant. When a patient leaves the workforce due to their illness, productivity losses should be estimated using a friction cost approach, i.e., a temporary friction period for replacing a lost employee who becomes disabled. It would normally last a few months, the time it takes to replace the missing employee and get them fully trained and operational. For low-qualification labour, it might be only a few weeks. For highly qualified positions, it might be 6-12 months. A common value is three months. A friction cost approach is more limited than a human capital approach that implies a permanent productivity loss, which may be adequate from a societal perspective (a permanent loss to society) but not reflective of the plan sponsor's context, where a lost employee will eventually be replaced. For estimating the productivity loss resulting from patients prematurely leaving the workforce, the friction cost approach is recommended for a private payor perspective – the human capital approach can be presented as ancillary information. The human-capital method takes the patient's perspective and counts any hour not worked as an hour lost. By contrast, the friction- cost method takes the employer's perspective, and only counts as lost those hours not worked until another employee takes over the patient's work. Drug acquisition costs/drug dosing As is the case for the budget impact analysis, the daily dose should be calculated directly from the data. In other cases, when there are several comparators, it is better to apply the dosing schedule as found in the product monograph and then adjust for relative dose intensity, when applicable. Adjusting for relative dose intensity observed in the randomized controlled trial is fine if this adjustment is applied to all drugs, not just the new drug (reducing its cost), as this could introduce bias. When estimating treatment duration, the mean duration should be used instead of the median because the median may underestimate the true cost of a treatment. It is imperative to provide explicit details about how the annual drug costs were calculated so that the costs can be validated by the reviewer. Also, the methods used to calculate drugs costs need to be consistent between the BIA and CEA. Appropriate comparators and coverage Similar to the TELUS Health budget impact guidance document, incorporating the appropriate comparator drugs is key to ensuring the model is relevant to plan administrators. Comparators need to reflect the current standard of care in Canada for the target population (e.g., off-label use when relevant). Drugs that are not used in actual practice should be excluded. As each payor may have different drugs covered on their formularies, it is beneficial to provide the option in the model to easily remove/include comparator drugs (e.g., drugs provided in hospitals may not be covered by the private insurer). Additionally, because a CEA intends to provide the most relevant analysis associated with reimbursing the new drug by a private payor, the base case analysis should consider that publicly funded comparators cost nothing to the private payor. This is common for intravenous drugs used in oncology. However, including the flexibility to include/exclude all drugs is preferred as some private clinics are providing IV drug administration and covered by private payor.

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