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Increasing drug use bureaucratisation – as in the case of therapeutic substitution – can be risky and costly public policy, according to a new study

par Valentin Petkantchin
mardi 4 décembre 2007.


Brussels, Tuesday, December 4, 2007 – With the aim of controlling health care spending, public authorities increasingly are regulating the prescription, use and reimbursement of drugs. One of the latest examples is therapeutic substitution policies concerning drug therapies.

The IEM invites you to watch a 10 minute conference presented by Valentin Petkantchin on this issue.

According to a new study by the Institut économique Molinari, such policies have already been implemented in various forms not only in Europe – in countries such as Germany or the United Kingdom – but also for example in New Zealand or Canada. Other countries in the future may well be tempted to go along this path.

Their principle is simple : facing the high cost of certain products, public authorities put doctors and patients under pressure to replace them with cheaper, brand name or generic, therapies, even if their chemical composition is different, their effectiveness weaker or their side effects stronger.

Risky policy

However, as the study points out, this sort of substitution policies by cheaper drugs, sometimes conducted on a broad scale for all insured persons, has its own costs and risks, even if it may create savings in the budgetary item of some specific pharmaceutical product.

For example, people covered under the public plan in New Zealand, where this type of policy was instituted, were pressured into substituting a less expensive, supposedly perfectly substitutable, drug for their anti-cholesterol therapy. It turned out that those who switched experienced considerable rises in cholesterol levels and were thus at higher risk of cardio-vascular incidents.

In the Canadian province of British Columbia, six months after the establishment of a therapeutic substitution policy for anti-ulcer drugs in July 2003, nearly 25% of patients who chose the less expensive referenced drug had to stop taking it because of its ineffectiveness or major side effects.

In the United Kingdom the risks from the change between two anti-cholesterol drugs were observed in a study conducted by a cardiology specialist at the North Staffordshire University Hospital. The drug switching was associated with a mortality rate more than three times higher as well as increased patient readmission rates to hospital following cardiac events.

A potential source of added costs

Complications following a change in therapy may end up requiring more visits to a doctor or a hospital, more analyses and more tests, leading to an increase in other areas of health care spending. Non-monetary but very real costs for patients in terms of lost time or greater suffering could also be very important.

Seeking to present some cheaper drugs as substitutable for patients could indeed be in itself a legitimate strategy for an insurance provider. However, concludes the study, for such a policy to be truly beneficial to patients and for its risks to be taken effectively into account, it must be subject to competition and to the “market test”. Insured persons, acting under their doctors’ advice, should have the option of changing health insurance plans if they feel that therapeutic substitution is not merely inadequate and lacking in added value in their eyes but that, on the contrary, it increases the risks to their health illegitimately.

Entitled, The risks of therapeutic drug substitution policies, the study is available at :…

Information and interview requests :
Valentin Petkantchin, PhD
Director of Research
Institut économique Molinari
Rue du Luxembourg 23, Boîte 1
1000 Bruxelles, Belgique
Tél : +33 4 42 53 46 19

Institut économique Molinari : proposer des solutions alternatives et  innovantes favorables à la prospérité de l’ensemble des individus composant la  société

Institut économique Molinari
Paris - Bruxelles - Montréal