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.
PI implies a complex scientific and technological process associated with long research periods and high financial investment. It is estimated that developing a new molecule may cost up to USD 2700 million and take up to 15 years of research. 2 Nevertheless, despite the cost that PI may represent to healthcare systems, an offset effect is often produced on other costs, which may lead to significant global savings in the total costs associated with the new drug's introduction to the market.Hence, beyond their clinical impact, drugs often have additional benefits on the healthcare system and society in general. Indeed, by preventing or treating more effectively different illnesses, PI, as many healthcare interventions, may reduce several direct and indirect costs associated with the disease and therefore become a very useful tool for optimal resource utilization. 3 In the health economics literature, direct costs refer to both direct healthcare costs (DHC) and direct nonhealthcare costs (DNHC). The former refers to the use of resources that is strictly related to illness management,
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