The timing of adoption of positron emission tomography: a real options approach

Abstract

This paper presents the economic evaluation from a hospital's perspective of the investment in positron emission tomography, adopting a real options approach. The installation of this equipment requires a major capital outlay, while uncertainty on several key variables is substantial. The value of several timing strategies, including sequential investment, is determined taking into account that future decisions will be based on the information available at that time. The results show that adopting this approach may have an impact on the timing of investment, because postponing the investment may be optimal even when the Expected Net Present Value of the project is positive.

Evaluation of Patient Registries Supporting Reimbursement Decisions: The Case of Oxaliplatin for Treatment of Stage III Colon Cancer

“…Another related approach is the real options approach, which has been applied in various applications, investment decisions regarding imaging techniques [23], and medical decision making in risky surgery [24]. Usually, however, an analytical solution can be obtained only by imposing strict assumptions on the distributions of the parameters involved that will not be met in practice.…”

When to Wait for More Evidence? Real Options Analysis in Proton Therapy

“…In these cases, "access with evidence development" schemes are not an option, and ROA provides evidence-based arguments that can be used for decision making. A real options approach has also been used in a recent study to examine whether hospitals should invest in positron emission tomography [44,45]. From the present study we found that adopting proton therapy and including all patients in the trial, which resembles the scheme, was never preferred, even when there were no reversal costs.…”

Evolution of studies on Real Options Theory in health sector

“…In 2008, the studies continue to focus mainly on investment analysis and, as shown by Levaggi and Moretto (2008), Pertile (2008), Pertile, Torri, Flor and Tardivo (2008) and Eckermann and Willan (2008). The first study evaluated a relationship between quality and investment in health technology.…”

“…In addition, it was analyzed the role of alternative payment systems. In the next study, Pertile, Torri, Flor and Tardivo (2008) In 2009, the studies were developed had several focuses. It was observed studies to evaluate investment, such as Özogul, Karsak, and Tolga (2009), which valued an Enterprise Resource Planning -ERP system investment incorporating multiple options.…”