So here is a chart that, sort of, gives you some examples of exactly what is direct cost, indirect cost and different variables are. So, the economic sign. Or you can also call this resource utilization because these are resources that we're utilizing, all right. So direct costs are things like the drug, things that you actually outlay money for and say all right, this is directly related to either the treatment or to the disease itself. So the drug is directly related. Physician visits, you're outlying money, hospitalizations, nursing time, transportation if its all related to the disease or its treatment. Indirect costs are in pharmaco, in pharmacoeconomics world just like an economics either things related to productivity, right its not like an accounting in direct cost. And accounting are lively overhead, lives everything is taking to rent the building. That's not what we're talking about in Pharmacoeconomics. So indirect costs or, or productivity. Kay? So that could be things like lost days of work. reduced productivity of either a patient but it can also be like the provider too. So it can be broadly interpreted. The clinical outcome are familiar with things like safety. Those can be things like headaches nausea. You know could be big things like stroke efficacy, cured patients, number of saved lives. Those types of variables. On the humanistic side the, the most common humanistic outcome of measured that's quality of life. Its health related quality of life, so its not everything to do with your quality of life, I mean what kind of car you drive where you live, your socio-economic status that is always have something to do with your health. We're talking about the types of the pieces of your quality of life that can be effected by your health status and I'll show you some example of that. patient satisfaction could be with the treatment itself. It could be with a provider, it could be with the system. Those are all humanistic type outcomes. And then there is a whole body of literature which I'm not going to go into today about patient preferences. And if you know, if you can think back to your basic economics class, you kind of remember things about utilities maybe. And there, there are ways that you can measure utilities to say how much something is valued also but I'm not going to talk about that to today. I'm going to stick with the quality of life underneath the humanistic outcomes. Okay. So I'm going to show you three examples and these are real examples from the published literature. And the examples are going to show you about direct costs, the things that are, you know, outlays of money. And that, another example on indirect costs for the productivity effect and then finally a quality of life example. OK, so here's a study and I, as I told you I'm not going to tell you a whole lot about the methods, I'm going to show you what the results were. Alright, this is a study in schizophrenia patients, alright? And what they did is they looked before and after Risperidone therapy initiation. And risperidone is a medication for schizophrenic patients. if you know anything about schizophrenia, it's, it's a difficult, it's a very difficult disease to treat. It's also a very difficult disease to do clinical trials in. finding the patients. Having the patients come back. Being able to track the patients. It's difficult. And, that, sort of, you can see that in the number of patients here. This is a small trial. 36 patients. And these 36, which is not unusual for this typical patient group. These 36 patients, they receive risperidone therapy for greater than seven months, some were up to seven, eight, nine months but everyone had taken the therapy for greater than seven months, right? And what the researchers want to look at were things not just the clinical safety and efficacy effects. If it did have good effects on improved symptom, symptomotology. The other things I wanted to look at were the economics. Specifically they looked at hospitalizations and what they found is that the change in hospitalizations from before to after the number of days per year, was a 25% reduction. Before the risperidone therapy that group of patients had an average of 1.7 days in the hospital, versus 4.2 days after they had done the risperidone kit therapy. So, I'm spending on the risperidone therapy but I'm saving hospital costs. Okay? And they also looked at. Not just hospitalization costs. They looked at other costs. So the drug costs actually went up. Alright. And the risperidone cost was $1889. But, they didn't need to use other psychotropic drugs. So, those prices, those costs went down by $587. So, the drug cost ended up increasing a mean. A mean of 1322. So I'm adding a new more costly drug. I'm offsetting some other drug utilization. And so far, I'm saving some hospitalizations. The cost, the decrease in costs. The average cost for the hospital was 762 dollars. And then there were also some other savings. [INAUDIBLE]. residential day care. Outpatient kinds of, care. Case management. That they also cost it. There was a reduction in those services. So there was savings in the reduced use of those services. a mean of 868. So, in total, the reduction in cost was $308 per patient. Right. on average. So, what I have here next to the 308 is like a little three, that's a percentage. So it's kind of a small percentage if you think about it, 3%. I'd say, oh, that doesn't seem like so much. Okay, but this is over just a seven-month and nine-month period. is over one small group of patients. Imagine you're a payor who is, especially if you're a medical, medicaid. You have a large population of schizophrenic patients. This savings can add up. Alright. And so this is a study that, actually, the, the manufacturers use to, to say. You know what? Our drug, risperidone, costs more. But we're saving you money elsewhere in the health care system. And that's kind of the whole point about pharmacoeconomics. This is a, this is a great story. this is what you would like to be able to say about your product. It doesn't necessarily have to be just savings and drugs. It can be savings and other portions of the healthcare system. Yes? >> so this was done by this sponsor but how can you be sure that it's not biased? Because they would like to show this data in a higher [INAUDIBLE]. >> They, they would love to show this data to get a higher reimbursement. so the question is, how can I be sure that this, these data are not biased? Alright. two ways. One, I, as a, a reader of the literature and if I'm working for a payor and I'm making these kind of decisions, I need to be able to analyse the, the study methods. I need to know about the clinical research methods, I need to know where the bias is in the clinical research, the safety and efficacy. Because that's driving the economics, right? But I also have to know about the methods used for the cost analyses. And I, we, I can teach a whole class on that because there are many, many different ways that I could've costed the hospital days, I could've collected the data. And that's a good point because the user of these data and looking at these studies, you've got to be very savvy on the methods that were used by the, by the researchers. Having said that, there are standards. There are guidelines and standards that researchers should use and there is a, there's an international, international society of pharmical economics and outcomes research. It's called Ispor, I S P O R. And you can go their website and ISPOR and you'll see they'll have guidelines for this kind of economic analysis, quality of life analysis, satisfaction analysis. And so when the papers are published, the peer review process that medical journals use should be using those guidelines to judge the quality of the, papers. But when a paper is peer reviewed, how many peers normally review it, do you think? Got any idea? >> Two. >> Two and it just had two, I mean [INAUDIBLE] a lot of studies. I am not an expert on every little thing that's in there and so I can slide through, you know the reader. And the person you like, you going to know which you are looking at be able to [INAUDIBLE] your self can't rely necessarily on the [INAUDIBLE] process. Not just for [INAUDIBLE] economic data, for clinical safety and efficacy data to.
