Health economics in the Canadian pharmaceutical industry

Abstract

Objective: To assess the goals, strategic focus, structure, capabilities, activities and effectiveness of health economics (HE) departments in the Canadian pharmaceutical industry, to examine how these have evolved, and the implications of HE in the future of the pharmaceutical industry.

Design and interventions: A mixture of telephone and face-to-face interviews with members of the HE unit (survey 1) and the chief executive officers (CEOs) [survey 2] of the top 21 Canadian pharmaceutical companies was undertaken in 1997.

Main outcome measures and results: 17 out of 21 companies responded to the first survey, and 12 of the 17 CEOs responded to our second survey. The goals of the HE department in most of the pharmaceutical companies have evolved from supporting efforts to gain reimbursement on government drug plans to include pricing, promotion, internal decision-making and other activities. Members of the HE department perceive their work to be valuable to the company. The CEOs felt that the true value of HE data is not adequately understood by formulary reviewers and, therefore, HE data may be an impediment to market access.

Conclusions: The purpose of the HE department is to demonstrate the value of the company's product to provincial government insurers. However, pharmaceutical companies are having difficulty justifying the importance of the HE department because of inconsistencies in the interpretation of economic evaluations by healthcare payers.