The Value of Pharmaceutical Innovation within the context of policies that impact the use of new medicines in Sweden

Billie Pettersson Frank Lichtenberg

Sweden is lagging behind other countries in the Western world when it comes to the introduction of new achievements in the area of drugs. A new research report from SNS presents analyses that indicate that a slow introduction of new, efficient drugs creates welfare losses for Swedish society, such as higher costs for hospital care and a slower increase in the length of life of Swedes.

the_value_of_pharmaceutical_innovation_2.pdf 1.3 MB PDF

New drugs can create large welfare gains for the patient and society. At the same time, there is an increase in the cost of new drugs. Thus, it is important to weigh the value of new drugs against the costs. In a new report on the value of innovation of drugs, the researchers Frank Lichtenberg, Professor at Columbia University, and the Swedish researcher Billie Pettersson, present statistical analyses that indicate that it might be beneficial for society to give patients access to new drugs more quickly.

The report analyses data on the introduction of new drugs for different diagnoses, mortality, stays in hospital and expenditure for medical care in Sweden in the period 1997–2010. The analysis shows:

A positive relationship between the number of new drugs that is introduced for a certain disease and the length of life of the patients.
A third of the increase in the length of life of Swedes in the period 1997–2010 can be attributed to the introduction of new drugs.
The introduction of new drugs is associated with fewer days in the hospital. This entails savings in public expenditure that are larger than the costs for new drugs.

– There is a great deal that indicates that the political reforms in the area of drugs in the last two decades – decentralisation of the costs to the county councils and the new price and subsidy system – have entailed a decrease in the availability and use of new drugs in Sweden. There is a need for a survey of the regulatory systems in order to create conditions for the correct use of those new drugs that are profitable for society, according to Billie Pettersson.

Authors of the report
BILLIE PETTERSSON has a PhD from Center for Medical Technology Assessment at the Department of Medical and Health Science, Linköping University and she is responsible for social questions at MSD. She has been a visiting researcher within the framework of the SNS Research Programme The Value of New Drugs.

FRANK LICHTENBERG is Professor at Columbia University, New York. Lichtenberg has studied the effects of innovation in the pharmaceutical area in several countries. He is one of the best researchers in the area at the international level.