The Value of New Medicines

Bengt Jönsson Katarina Steen Carlsson

The cost of a medicine can be calculated rather easily. But cost is not the same thing as value. For medicines to be used efficiently, knowing value is crucial.

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The Value of New Medicines explains and critiques the concept of value, which has become a central focus of both scientific studies and health care policy. This book presents a framework for answering questions about value in an objective and verifiable way that is useful for policy making, and describes how to ensure that the introduction and use of medicines is based on value. Whilst the focus is on Sweden, the analysis and policy recommendations also may be relevant for other countries that are developing new policies, institutions and mechanisms to encourage the efficient and equitable introduction and use of new medicines under stringent economic conditions.

The report highlights the need to:

  • Collect and analyse data from actual clinical practice to improve understanding of the effects, benefits and cost of medicines as a basis for assessing value
  • Adopt sound decision-making processes that are consistent across the health care system
  • Abolish price controls and permit prices of medicines to differ based on their benefits
  • Create payment mechanisms that recognise that the value of a medicine can vary depending on the disease it is used to treat
  • Analyse regional variations in patterns of use and treatment costs as the basis for policies that optimise the use of medicines
  • Create incentives for best use and continuous evaluation of new medicines.

Bengt Jönsson, PhD, Emeritus Professor at the Stockholm School of ­Economics, is an internationally respected health economist and currently Vice Chair of the European Commission Expert Panel on Effective Ways of Investing in Health.
Katarina Steen Carlsson, PhD, is Research Director at the Swedish Institute for Health Economics (IHE) and a Researcher in health economics at Lund University.

The Value of New Medicines is a translation of the final report of a research programme entitled The Value of New Pharmaceuticals, a project of the Centre for Business and Policy Studies (SNS) in Sweden. The purpose of the research programme has been to contribute knowledge to support decision-making that affects access to new medicines and determines how medicines are used.