Table 1.

Types of Pharmacoeconomic Studies.^21–24

Pharmacoeconomic Study	Description	Use Case	Example
Cost-minimization analysis (CMA)	To select the least costly among several similar interventions. • Applied when there is a need to compare multiple drugs of equal efficacy and equal tolerability. • Is performed when the outcomes are the same for the two interventions. • It cannot be used to evaluate programs or therapies that lead to different outcomes.	To identify the least costly option when outcomes/consequences are identical.	Compare costs of Drug A and Drug B (equal efficacy for a given condition and safety).
Cost-benefit analysis (CBA)	To identify, measure, and compare the benefits and costs of a program or treatment alternative. • The most comprehensive and the most difficult of all economic evaluation techniques. The benefits are assigned a monetary value so that costs and benefits can be easily compared. Different interventions can be compared – is a useful tool (like CUA) for resource allocation by policy-makers. • CBA should be employed when comparing treatment alternatives in which the costs and benefits do not occur at the same time. • Can be used to compare programs with different objectives - because all benefits are converted into currency and to evaluate a single program or compare various programs.	To compare programs or agents with different objectives or one program against a return on investment benchmark.	Clinical pharmacy service vs another institutional service.
Cost-effectiveness analysis (CEA)	To assist decision-makers in identifying the preferred choice among possible alternatives. • Used to evaluate multiple drug interventions for the same condition. The cost of drug treatments is weighed against the effectiveness of the drug. • The costs of drug treatments consist of acquisition costs, physician engagement, and nursing costs for administration of the drug. • The effectiveness of drug treatment is measured by the duration of treatment, length of hospital stay, and mortality rate. • The key measure of these evaluations is the incremental cost-effectiveness ratio (ICER).	To compare treatment alternatives for a given condition that differ in outcomes and costs.	Osteoporosis: Drug A vs Drug B on fracture risk reduction ($/fractures avoided).
Cost-utility analysis (CUA)	To compare medications or interventions with different outcomes. • Compare cost, quality, and the number of patient-years. • Used when programs and treatment alternatives should be compared. • CUA is applied less frequently than other economic evaluations because of the lack of standardization of measurement utilities, eg, difficulty comparing QALYs (quality-adjusted life-years) across patients and populations and difficulty quantifying patient preferences.	The same as CEA, useful when treatment extends life and/or affects the quality of life.	Compare cancer chemotherapy regimens.