With global spending on medicines likely to reach one trillion dollars by 2014, and growing concern about the cost-effectiveness of all parts of healthcare spending, an examination of the ways in which medicines are used is both timely and relevant to understand their impact on patient outcomes and the costs of delivering healthcare.

A recent report by the IMS Institute for Healthcare Informatics tackles the issue of understanding the linkage between responsible medicine use and health system costs.  By examining six levers for improving medicine use, and developing an economic model to estimate global avoidable costs, the Institute was able to illuminate the magnitude of the opportunity for improvement — avoiding costs for health systems while maintaining or improving health outcomes.

The six primary areas examined were:

  • Increasing medicine adherence by addressing patient beliefs and behaviors at the point of prescription and during medicine intake
  • Ensuring timely medicine use that prevents avoidable and costly consequences among patients with highly prevalent diseases that increase in severity if diagnosis and treatment are delayed
  • Optimizing antibiotic use to turn the tide on rising antimicrobial resistance worldwide due to the misuse and overuse of antibiotics
  • Preventing medication errors throughout the medicine provision pathway, from prescription to administration
  • Using low-cost and safe generic drugs where available to leverage the under-exploited opportunity in post patent-expiry markets
  • Managing poly-pharmacy where the concurrent use of multiple medicines, particularly among the elderly, risks costly complications and adverse events.

While these six levers are relevant for all countries worldwide, the report also investigates three other areas more relevant to some countries than others:  minimizing supply disruptions from medicine shortages and substandard medicines; optimizing use of expensive therapies; and reducing medicine abuse.

In this study, the term “responsible use of medicines” was defined as the alignment of activities, capabilities and resources of all health system stakeholders — including healthcare professionals and patients — to ensure patients receive the right medicines at the right time, use them appropriately and benefit from them.

How Much Could Be Saved?

The total amount of annual avoidable costs estimated in the report is almost $500 billion, or about 8 percent of total global healthcare spending.  (See chart below, click to enlarge.)  This amount includes non-medicine as well as medicine spending and reflects the tight linkage between medicines and their impact on other patient treatment and related costs including hospitalizations, health professional and facility costs.  The estimate likely understates the full magnitude of avoidable costs since some of the analysis was focused on a limited number of disease areas.

The quantification effort by the IMS Institute is intended to trigger a meaningful discussion on how to assess the impact of responsible use in each country.  The estimates were derived from a global modeling analysis based on best available data for 186 countries.  The model assumes health outcomes will at minimum be maintained or improved.  Factors considered for country variation in the modeling analysis include demographics, non-communicable disease risk factors, healthcare access, health system infrastructure and medicine intensity, including antibiotic use in the system and availability of new medicines.

The report strikes an optimistic tone in addressing what actions can be taken by health system leaders in order to capture this avoidable cost opportunity.  It includes a number of recommendations aimed at a health minister or other health system leaders and especially focuses on actions that will have a measurable impact within 2-5 years, require relatively low investment costs, and yield health outcome gains.  These ideas are underpinned by case studies drawn from 12 different countries and supporting evidence from 30 countries.


When considered on a global basis and across these criteria, the top five recommendations which each country should assess for feasibility are:

  • Strengthen the role of pharmacists in medicines management
  • Invest in medical audits focused on elderly patients
  • Implement mandatory reporting of antibiotic use
  • Encourage a “no blame” culture toward error reporting
  • Support targeted disease management programs for prevalent non-communicable diseases.

More specific recommendations must be tailored to the needs of a particular health system, and five success factors related to policy, collaboration, education and capacity-building efforts, informatics and incentives must be considered before implementing recommendations.

The critical role of information in driving more responsible use of medicines is underscored throughout the report.  Strengthening health informatics capabilities can enable health system leaders to prioritize interventions and support behavior change among healthcare stakeholders and patients.  They also underpin the effective measurement of progress over time – including the capturing of the $500 billion in annual avoidable costs and redeployment to other areas of the healthcare system.

The report emphasizes that health system leaders should not let the perfect stand in the way of the good, noting that while an overall shift to improved policies will take time, each leader can take initial, necessary steps to advance the responsible use of medicines in the near term.

The full report and a summary version can be accessed here on a website dedicated to the issues and opportunities related to the responsible use of medicines.  The report was prepared for a closed Health Ministers Summit organized by the Dutch Ministry of Health, Welfare and Sport on October 3, 2012 with the theme: “The benefits of responsible use of medicines: Settling policies for better and cost-effective healthcare.”  The report was developed by the IMS Institute for Healthcare Informatics as a public service without industry or government funding.