Contemporary Issues Affecting P&T Committees: USE OF PHARMACOECONOMIC DATA


The growing prominence of drug therapies in health care and their rapidly rising costs have led to a dramatic rise in the use of health outcomes data for therapeutics and formulary decisions. The expanded use of cost-effectiveness data, analyses of health outcomes, and various pharmacoeconomic (PE) models have become commonplace in today’s world of rising costs and increased utilization. For a medication to be considered effective—and at the same time to be less expensive to use than other drugs available in the therapeutic class—numerous cost comparisons are required along with health outcomes studies.

As P&T committees have evolved, the amount of information that the members need to take into account in order to make sound decisions about their formulary drug selections has also simultaneously increased. Besides available outcomes studies and surrogate measures of long-term health and economic outcomes, P&T committees must consider the impact that a given agent may have on patient compliance and adherence, the potential for medical errors, the effect on prescribing behaviors, and the published results of clinical trials. Methods such as disease-based economic models, which can help determine the potential impact on clinical and economic consequences following the introduction of a particular product into a formulary, should be devised.
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Odedina et al. noted that 86% of surveyed pharmacist-members of P&T committees in Florida hospitals stated that PE data were used in their formulary evaluations all the time or very often. The survey also showed that approximately 70% of the participants’ hospitals had someone with pharmaco-economic skills on staff and that 4% of the hospitals consulted outside experts in this field.


Assessment of both cost and outcomes of a particular product becomes a critical task for P&T committee members during the decision-making process. Various measures are available for evaluating the costs of medications and their use.

Figure 1 Process of a Drug Utilization Review (DUR) Study

Figure 1 Process of a Drug Utilization Review (DUR) Study

One such measure, the DUR, is a formal, stepwise approach that evaluates the clinical appropriateness and patterns of use, adverse drug events (ADEs), and acquisition costs. DURs identify whether current patterns of prescribing, dispensing, and using drug therapy are consistent with accepted criteria and standards. If therapy is determined to be inconsistent with the agreed-upon criteria and standards, then specific actions may be needed to address this problem. Figure 1 illustrates the DUR process.

Even though DURs are useful for evaluating costs and drug usage patterns, they have inherent limitations. They incorporate patient care outcomes, provider preferences, provider-prescribing behaviors and habits, and their current knowledge of therapeutic choices in an inconsistent manner. DURs and other traditional approaches to determining medication inclusion and use base their results on incomplete or possibly inaccurate data and often focus on the unit cost of drugs rather than on total therapy costs and medical care savings.

After examining data from six state Medicaid programs, Hennessy et al. concluded that DUR programs did not improve patient health or reduce the rate of prescription errors.

Lichtig et al. developed a new integrated approach, called the Clinical Effectiveness Initiative (CEI), which uses the readily available administrative databases of hospitals. The CEI is used to evaluate the overall cost of treating patients, which includes laboratory, medical, and surgical supplies; intensive care; and all other department expenditures in addition to the pharmacy expenses.

Clinical Effectiveness Resource Management (CERM), an output of CEI and a method that we developed, was designed to assess available therapeutic options and newer therapies for comparison with existing ones. This approach uses the financial information obtained from a hospital’s Medicare cost report, the UB-92 Claim Form, and other administrative data to compare the costs and patient outcomes of existing alternatives. Such an approach allows a hospital to allocate its limited resources appropriately and to direct them to areas in which they see the potential for financial improvement and better health outcomes for patients.
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Because there has been a proliferation of new and expensive medications into the market, a population that is living longer with more diseases, the advent of direct-to-consumer marketing by the pharmaceutical manufacturers, and rising drug costs, devising ways to tackle these issues has become extremely important. There has been a raging debate as to how these new costly medications have contributed to rising overall health care expenses. The new drugs are definitely expensive, but some of them provide distinct advantages in terms of reduced side effects and better patient outcomes than less expensive, older alternatives.

Despite their higher acquisition costs, many newer medications can effectively reduce the overall cost of care for patients and thus may also prove to be financially beneficial to both hospitals and managed care networks. A thrombosis management CEI is an example that focuses on a comparison of unfractionated heparin (UFH) with low-molecular-weight heparins (LMWHs), such as enoxaparin, in treating and preventing deep vein thrombosis and pulmonary embolism in hospitalized patients.

Finally, given the broader scope and complexity of drugs coming before P&T committees today, more of a multi-disciplinary makeup is required to include expertise on biotechnology therapies. Expanding the P&T committee to include active participants and establishing specialist subcommittees to make specific formulary recommendations, as well as considering overall patient care implications of selected or proposed drugs, can accomplish this goal. Compared with the newer biotechnology medications, some of which cost as much as $5,000 per dose, the older injectable agents can be managed more simply within existing P&T committee structures. tadalis sx

David Nash, MD, MBA, recently claimed, “If a hospital hasn’t made the switch to a multidisciplinary P&T committee, you have to ask what’s wrong. . . . If your P&T committee is not on top of that [biotechnology products], it surely ought to be.”


In Parts 1 and 2 of this series, we described the evolution of the roles assumed by P&T committees and the continuing challenges they face. From the focus on rational medication choices to the practice of monitoring adverse drug reactions and operating within an organization’s budgetary limits, the duties of P&T committees have been continuously expanding and evolving. There is a need for P&T committee members to make a greater number of difficult choices about the medications to be included in or excluded from their formularies. These decisions become significant from the financial perspective as well as for the clinical outcomes of the patients enrolled in health care plans. Balancing costs and health outcomes is critical, and the judicious use of commonly available data is of the utmost importance.

The use of data that integrate overall costs and provide comparisons between alternative therapies gives leverage to stakeholders by allowing for more sound decision-making, thereby enabling them to more easily identify pockets of high costs and undesirable outcomes. The use of such data by P&T committee members will empower them to meet the current and emerging challenges in a sound way.

Category: Main

Tags: Committees, Contemporary Issues

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