NCPA - National Center for Policy Analysis

HIV Drug Therapies Are Cost Effective And Cost Saving

March 20, 2001

Since the introduction of more effective therapies about five years ago, drug costs for treating HIV-infected patients have soared, with wholesale prices ranging from about $2,500 per person per year for the nucleosides to $8,000 for one of the protease inhibitors. However, new studies show drug treatment lowers patients' hospital costs -- and thus may save money overall -- and is relatively cost-effective.

Researchers followed nearly 3,000 randomly selected HIV patients from 1996 - 1998, and estimated the average monthly expenditure per patient based on self-reported information.

  • For January 1996, their estimated average monthly direct expenditure for an HIV patient was consistent with other studies, at about $1,800.
  • Over the period, expenditures declined 16 percent -- with spending for hospital care declining 43 percent, and pharmaceutical expenditures increasing 33 percent.
  • After adjustments, estimated annual expenditures declined from $20,300 per patient in 1996 to $18,300 in 1998.

But expenditures among subgroups of patients varied by a factor of as much as three. Pharmaceutical costs were lowest and hospital costs highest among underserved groups -- blacks, women and patients without private insurance.

Other researchers have estimated the clinical benefits and cost effectiveness of combination antiretroviral therapy, based on data from major clinical trials. They found:

  • Life expectancy adjusted for the quality of life increased from 1.53 to 2.91 years, and per-person lifetime costs increased from $45,460 to $77,300 with three-drug therapy compared with no therapy.
  • The marginal cost per quality-adjusted year of life gained was $23,000.

This compares favorably with the cost effectiveness of therapies for some other diseases. For instance:

  • Radiation therapy for early-stage breast cancer has a cost-effectiveness ratio of $30,000 per quality-adjusted year of life gained.
  • Treatment of hypercholesterolemia costs $47,000 per year of life gained, and dialysis in patients expected to live less than six months costs $150,000 per quality-adjusted year of life gained.

Source: Samuel A. Bozzette et al., "Expenditures for the Care of HIV-Infected Patients in the Era of Highly Active Antiretroviral Therapy," and Kenneth A. Freedberg et al., "The Cost Effectiveness of Combination Antiretroviral Therapy for HIV Disease," both New England Journal of Medicine, March 15, 2001.


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