Vaccine Economics: Diseases, Dollars, and Dilemmas

1. Vaccine Economics:Diseases, Dollars, and Dilemmas Tracy Lieu, MD, MPH Center for Child Health Care Studies, Depts of Ambulatory Care and Prevention and Pediatrics, Harvard Medical School and Harvard Pilgrim Health Care

2. Topics • Economic factors pose barriers to optimal vaccine use • Placing the right value on vaccines • Making the right recommendations for vaccines in the U.S. • Getting the right vaccines made for developing countries

3. Topics • Economic factors pose barriers to optimal vaccine use • Placing the right value on vaccines • Making the right recommendations for vaccines in the U.S. • Getting the right vaccines made for developing countries

4. Source: USA Today, Thursday, October 28, 2004; 1A

6. Prices of Old and New Vaccines

7. Contrasts Between Old and New Vaccines Old • Biologically simpler • Two or more manufacturers • Lower cost • New • Biologically complex • Single manufacturer • Higher cost

8. Benefit-to-cost ratiosfor childhood vaccines, US health care system DTP 6:1 MMR 16:1 Polio 3:1 Hib 3:1

9. Cost of immunizing a US child CDC/NIP

10. Projected deaths prevented by vaccination of US children

11. Topics • Economic factors pose barriers to optimal vaccine use • Placing the right value on vaccines • Making the right recommendations for vaccines in the U.S. • Getting the right vaccines made for developing countries

12. Cost-Effective = Cost-Saving Health Outcomes or = Costs

13. Different Perspectives, Different Costs

14. Pneumococcal Conjugate Vaccine Background • Leading bacterial cause of meningitis, pneumonia, otitis media • New vaccine found effective in randomized trial in 1999 • Vaccine price announced at $58 per dose

15. Cost of immunizing a US child CDC/NIP

17. Projected Benefits and Costs of Routine Pneumococcal Vaccination of U.S. Children Decision analysis • Decision tree • Probabilities • Costs • Base case analysis • Sensitivity analyses Lieu JAMA 2000;283:1460-68

18. Death Disability Meningitis Deafness No sequelae Bacteremia Pneumonia Complex otitis media Simple otitis media Pneumococcal infection

19. Projected Benefits Lieu JAMA 2000;283:1460-68

20. Medical Savings

21. Cost-Effectiveness • Net cost = $172 million • Cost-effectiveness ratio = $80,000 per life-year saved • Problem: Doesn’t give credit for preventing meningitis, bacteremia, pneumonia, or otitis media Lieu JAMA 2000;283:1460-68

22. Quality-adjusted life-years (QALYs) • Simplified definition: 1 QALY = 1 year in perfect health • QALYs are a standardized measure to: • Give credit for preventing disease • Weigh benefit of preventing disease against the harm of vaccine reactions • Make comparisons with other vaccines and health services

23. Time-Tradeoff Questionto Measure QALYs Example: Meningitis • Imagine that you have a 1-year-old child • Very fussy with high fever for 1-2 days • Pediatrician does tests, including spinal tap • Hospitalized for IV antibiotics for 10 days • No additional problems • How much of your life, if any, would you trade to prevent this? Prosser Pediatrics 2004;113:283-90

24. Time-Tradeoff Resultsfrom Community Respondents Prosser Pediatrics 2004;113:283-90

25. How QALYs Change the Appraisal of Cost-Effectiveness Prosser Pediatrics 2004;113:283-90; Lieu Health Affairs in press

26. Comparisons with Other Preventive Health Services

27. Impact • Policy • Pneumococcal vaccination recommended for U.S. infants in 2000 • Scientific • Need to measure nonmonetary benefits to place appropriate value on vaccines

28. Institute of Medicine 2004Financing Vaccines in the 21st Century “ACIP (or some other advisory body) should conduct an analysis to determine the monetary value to society of each vaccine.” “The calculation of nonmonetary benefits can draw on a substantial literature that suggests monetary values for years of life gained. Quality-of life and disability measurements are also standard in the literature.”

29. Issues to Discuss • Whose values to use? • Community members, patients or parents, providers • How to value short-term, vs. chronic, health states? • How to address skepticism about economic approaches to measuring health benefit (utility assessment, contingent valuation)?

30. Topics • Economic factors pose barriers to optimal vaccine use • Placing the right value on vaccines • Making the right recommendations for vaccines in the U.S. • Getting the right vaccines made for developing countries

32. 300,000 250,000 200,000 Number of cases 150,000 100,000 50,000 0 1922 1930 1940 1950 1960 1970 1980 1990 2000 Year Reported Pertussis Cases U.S., 1922-2004* DTwP * 2004 provisional

33. 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 1980 1990 2000 Number of cases All ages <7 yrs Year

34. Pertussis -- Background • Increases in infant pertussis, with 16 deaths in 2004 • Suggests pertussis circulation is increasing due to waning immunity • Acellular pertussis vaccines for adolescents and adults developed

36. Pertussis Policy Decision Pertussis No vaccination No pertussis Adolescents one dose Adolescents + adults every 10y Adults one dose Adults every 10y Parents of infants (Cocoon) Public health policy

37. Incidence, Cost, and QALYs • Empirical studies via Massachusetts enhanced pertussis surveillance system • Retrospective analysis of 2600 cases for medical costs • Prospective telephone interviews of 500 cases for time costs and QALYs Lee Clin Infect Dis 2004;39:1572-80

38. Pertussis Incidence and Cost Lee Clin Infect Dis 2004;39:1572-80

39. Medical Costs of Adolescent Pertussis

40. Pertussis Vaccine

41. Measuring QALYs:Time-Tradeoff Method Example: Severe cough How many days or weeks would you be willing to give up from the end of your life to avoid severe cough for 8 weeks? The cough can cause vomiting several times a week, difficulty eating or drinking, and difficulty sleeping. Lee Health Qual Life Outcomes 2005;3:17

42. Time-Tradeoff Results Lee Health Qual Life Outcomes 2005;3:17

43. Cost-Effectiveness in US 2004 dollars, at vaccine price = $15 Lee Pediatrics in press

44. Comparisons with Other Vaccines • From the societal perspective: • $ per $ per • case QALY or life-yr prevented saved • Varicella 1 dose Saving Saving • Hepatitis B Saving Saving • Pneumococcal 200* 4,700 per QALY • Pertussis 1,100 19,000 per QALY • Meningococcal 600,000 120,000 per life-yr * Includes otitis media, pneumonia, meningitis, and bacteremia.

45. Comparisons with Other Preventive Health Services

46. Impact • Policy – ACIP this June • Decision on adolescent vaccination? • Discussion of adult vaccination • Scientific • Disease burden, cost, and cost-effectiveness are only a few of the key factors

48. Upcoming DecisionsAdvisory Committee on Immunization Practices

49. Policy-Related Factors Feudtner & Marcuse Pediatrics 2001;107:1158-64

50. Issues to Discuss • How should we incorporate these policy-related factors in vaccine decisions? • Explicit measurement • Explicit process • Should ACIP continue to issue “one size fits all” recommendations? • Current approach leads to gaps in financing • How should clinicians deal with “optional” vaccines?