Objectives: The aim of this study was to estimate the relationship between the financial impact of a new drug and the recommendation for reimbursement by the Australian Pharmaceutical Benefits Advisory Committee (PBAC).
Methods: Data in the PBAC summary database were abstracted for decisions made between July 2005 and November 2009. Financial impact-the upper bound of the values presented in the PBAC summary database-was categorized as ≤A$0, >A$0 up to A$10 million, A$10 million up to A$30 million, and >A$30 million per year. Descriptive, logistic, survival, and recursive partitioning decision analyses were used to estimate the relationship between the financial impact of a new drug indication and the recommendation for reimbursement. Multivariable analyses controlled for other clinical and economic variables, including cost per quality-adjusted life-year gained.
Results: Financial impact was a significant predictor of the recommendation for reimbursement. In the logistic analysis, the odds ratios of reimbursement for drug submissions with financial impacts ≥A$10 million to ≥A$30 million or >A$0 to <A$10 million compared with ≤A$0 were 0.12 (95 percent confidence interval [CI]: 0.03-0.51) and 0.16 (95 percent CI: 0.04-0.60), respectively. In the recursive partition decision analysis, the first split of the data was for submissions with a positive financial impact compared with those with a zero or negative financial impact.
Conclusions: In Australia, financial impact on the drug budget is an important determinant of whether a new drug is recommended for reimbursement when cost-effectiveness estimates and other clinical and economic variables are controlled.