The offset effect of pharmaceutical innovation: A review study

Abstract

It is well known that pharmaceutical innovation has improved the health and quality of life of patients. It is however sometimes forgotten that new drugs also have the potential of improving the efficiency and the sustainability of the healthcare system. The objective of this review is to shed light on the magnitude of the offset effect that drugs may have in the realm of the healthcare system and for society as a whole. A narrative literature review was carried out. This review demonstrated that a growing body of literature has tried to measure the magnitude of the offset effect associated with pharmaceutical innovation, both at the aggregate level and for different diseases. There is evidence that the aggregate use of new drugs can generate net savings to the healthcare system and to society, as they may release both healthcare and non-healthcare resources for alternative uses. A high degree of heterogeneity in the magnitude of the effect has been found across different pathologies and different types of drugs.