pharmacoeconomics

Pharmacoeconomics refers to the scientific discipline that compares the value of one pharmaceutical drug or drug therapy to another. It is a sub-discipline of health economics. A pharmacoeconomic study evaluates the cost (expressed in monetary terms) and effects (expressed in terms of monetary value, efficacy or enhanced quality of life) of a pharmaceutical product. Pharmacoeconomic studies serve to guide optimal healthcare resource allocation, in a standardized and scientifically grounded manner.

== Economic evaluation == Pharmacoeconomics centers on the economic evaluation of pharmaceuticals, and can use cost-minimization analysis, cost-benefit analysis, cost-effectiveness analysis or cost-utility analysis. Quality-adjusted life years have become the dominant outcome of interest in pharmacoeconomic evaluations, and many studies employ a cost-per-QALY analysis. Economic evaluations are carried out alongside randomized controlled trials and using methods of decision-analytic modeling. Pharmacoeconomics is a useful method of economic evaluation of various treatment options. As more expensive drugs are being developed and licensed it has become imperative especially in context of developing countries where resources are scarce to apply the principles of pharmacoeconomics for various drugs and treatment options so that maximum improvement in quality of life can be achieved in minimum cost.