This week we were able to answer a question that has long puzzled the healthcare industry – what are the total costs of prescribing a particular drug? Our launch of RxCost™ provides an answer by allowing a look into a group of comparator drugs to see which has the most expensive side effects and, by extension, is least safe.
RxCost is the first methodology to quantify the real-world medical costs from adverse drug events. This data will help better inform formulary, prescribing, and purchasing decisions at the payers, plans, systems, and industry markets that we currently serve.
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This launch is an important milestone for our industry for a number of reasons. It is the first process to marry safety to cost. While we’d all like to believe that the healthcare system will take steps to improve patient safety and outcomes because it’s the right thing to do, it’s not always so simple in a for-profit healthcare model. Many decisions on what drugs to place on a formulary are based on efficacy and upfront pill cost, with only secondary attention paid to safety. Since launching AdverseEvents, we’ve stressed the importance of factoring safety into those decision making processes, as it is the only way to both improve patient outcomes and downstream medical costs. And while many market-leading health systems and plans have begun to do this, we think the trend will accelerate quickly now that we’ve been able to put real dollars-and-cents numbers around safety factors.
With RxCost, comparisons by class, indication, or mechanism of action are even more direct and plain. We can more quickly track the economic results of emerging safety issues in new drugs, compare those to more established drugs, and even quickly formulate a financial model for novel developments like biosimiliars.
Fully integrating RxCost within our AdverseEvents Explorer platform is where these added layers of value emerge. For example, if we look at the DPP-4 Inhibitors used to treat Type II Diabetes (see chart below), we can see the drug costs in blue and then the additional RxCost in orange. While Nesina has one of the lowest retail drug costs in this group, its total economic impact including the RxCost makes it the most expensive.
The relative simplicity of the chart above belies the complex processes our amazing analyst and tech teams had to develop to make this analysis possible. Marrying Medicaid drug cost data to AHRQ adverse event costing data to our own drug safety data was no easy feat. And now RxCost data is accessible for the first time for more than 700 drugs, with many more to come.
The ability to quickly obtain, easily review, and proactively act on these RxCost data will dramatically improve patient outcomes and lower system-wide costs. It’s that simple. And with an estimated $25 billion in avoidable serious events and negative patient outcomes from drug adverse events hitting the U.S. healthcare system in 2013, it seems the introduction of RxCost is right on time. RxCost, as part of the AdverseEvents platform, will ensure that health care decision makers will now have vital independent adverse event and outcomes costing data available during their drug purchasing and formulary management processes. This means they now have the tools to be proactive instead of reactive in their attempts to mitigate this enormous cost burden that adverse events have on their bottom lines.