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Costs of NeurostimulationCan We Afford The Therapy in 2020?Krishna Kumar MBBS MS FRCS(C) Member Ord. of Canada, Saskatchewan Ord. of MeritClinical Professor of NeurosurgeryDepartment of NeurosurgeryRegina Canada

Syed Rizvi MDDepartment of NeurologyUniversity of Saskatchewan Regina Canada1DisclosuresAct as a consultant for Medtronic Inc. And Boston Scientific.

Have received research grants from Medtronic Inc.

Disclosures2DisclosuresPolicymakers require evidence of comparative cost-effectiveness in order to continue to make funding decisions

To make the case for neurostimulation we use SCS as a prototype

This presentation illustrates the long-term cost-effectiveness of SCS compared with CMM as projected for the year 2020

Introduction3National Institute of Arthritis and Musculoskeletal Skin Diseases website. News and Events Page. ghttp://www.niams.nih.gov/ne/highlights/spotlight/2006/back_pain_study.htm. Institute of Medicine. Relieving Pain in America: A Blueprint for Transforming Prevention, Care, Education, and Research. Washington, DC: The National Academies Press. 2011. Darrell J. Gaskin, Patrick Richard. The Economic Costs of Pain in the United States. The Journal of Pain, 2012; 13 (8): 715 DOI: 10.1016/j.jpain.2012.03.009Projected4DisclosuresTo evaluate the cost impact of SCS against CMM over time we will project costs for 4 commonly encountered chronic pain syndromes:

FBSS (Failed Back Surgery Syndrome)CRPS (Complex Regional Pain Syndrome)PAD (Peripheral Arterial Disease)RAP (Refractory Angina Pectoris)

Introduction5MethodsMarkov model developed to evaluate the cost-effectiveness of SCS versus CMMModel inputs derived from 313 patients

Costs and outcomes followed in six-month cycles

Health effects expressed as quality-adjusted life years (QALYs) gained

Costs and effects were evaluated over an 8-year time horizon (2012-2020) and discounted at 3.5% per annum

Methods6Cost-effectiveness was identified by deterministic and probabilistic sensitivity analysis (50,000 Monte-Carlo iterations)

Outcome measures presented:

CostEffectiveness (EQ-5D)Incremental cost-effectiveness ratio (ICER)Incremental net monetary benefit (INMB)Acceptability of treatment (CEAC)Expected value of perfect information (EVPI)Strategy selection frequencyMethods7Judging Cost-effectiveness:Willingness-to-Pay (WTP)USA and Canada: $50,000 / QALY 1 , 2

United Kingdom: 20,000- 30,000 / QALY 3Willingness to Pay:Judging Cost-effectiveness 1Braithwaite RS, Meltzer DO, King JT Jr, Leslie D, Roberts MS. Med Care 2008; 46(4): 343-5.2King JT Jr, Tsevat J, Lave JR, Roberts MS. Med Decis Making 2005; 25(6): 667677.3Devlin N, Parkin D. Health Economics 2004; 13(5): 437-452.8Markov ModelTreatment OptionsSCSTrialCMMSuccessOptimal Health StateSuboptimal Health StateCMMCMMOptimal Health StateSuboptimal Health StateFailureImplantDeathDeathTreeAge Pro 2011 (TreeAge Software Inc., Williamstown MA)9FBSSCRPSPADRAPVariableBase CaseStd DevBase CaseStd DevBase CaseStd DevBase CaseStd DevCost SCSPre-implant (Source: Hospital Finance Department)$4,120$515$4,161$495$4,165$529$4,249$546Implant procedure (Source: Hospital Finance Department)$22,750$2,844$23,226$2,764$23,834$3,027$21,981$2,825Complications (Source: Neuromodulation Clinic)$467$58$425$51$481$61$443$57Maintenance (Source: Neuromodulation Clinic)$3,170$396$3,696$440$4,236$538$3,783$486Adjunctive therapy (Source: Neuromodulation Clinic)$1,130$141$1,141$136$1,142$145$1,165$150Pharmacotherapy (Source: Neuromodulation Clinic)$267$33$269$32$269$34$275$35CMMEvaluations and follow-up by health care providers (Source: Patient Database)$785$98$793$94$794$101$810$104Imaging (Source: Patient Database)$1,450$181$1,465$174$1,466$186$1,495$192Pharmacotherapy (Source: Neuromodulation Clinic)$800$100$808$96$809$103$825$106Alternative therapy (Source: Patient Database)$2,355$294$2,379$283$2,381$302$2,429$312Intermittent hospitalization/Emergency Room visits (Source: Patient Database)$1,500$188$1,515$180$1,517$193$1,547$199EQ-5D (Source: Patient Database)Optimal CMM health state 0.540.070.520.060.510.060.540.07Optimal SCS health state0.620.080.590.070.550.070.560.07Suboptimal CMM health state0.320.040.270.030.220.030.210.03Suboptimal SCS health state0.410.050.420.050.370.050.320.04Probability (Source: Patient Database)Optimal CMM health state0.200.030.200.020.180.020.220.03Optimal SCS health state0.600.080.650.080.600.080.850.11Transitioning from SCS suboptimal health state to an optimal health state in the CMM strategy0.200.030.220.030.170.020.160.02Suboptimal CMM health state0.700.090.660.080.720.090.630.08Suboptimal SCS health state0.300.040.280.030.360.050.310.04Transitioning from SCS suboptimal health state to a suboptimal health state in the CMM strategy0.700.090.690.080.710.090.750.10Death0.010.000.010.000.050.010.050.01This the input table for the model and includes the cost, effectiveness, and probability values that were input into the Markov model.10Results11Costs, Effectiveness, and ICERs associated with SCS+CMM and CMMStrategySCS+CMMCMMFBSSCost (CAN$)$89,094$82,654Effectiveness (QALY)3.062.18ICER (cost per QALY gained)$7,318CRPSCost (CAN$)$105,049$91,968Effectiveness (QALY)1.823.18ICER (cost per QALY gained)$9,618PADCost (CAN$)$96,113$88,017Effectiveness (QALY)1.652.76ICER (cost per QALY gained)$7,294RAPCost (CAN$)$99,043$110,932Effectiveness (QALY)1.673.13ICER (cost per QALY gained)$8,143The ICER is calculated by dividing the difference in cost by the difference in QALY. The ICER of SCS over CMM for FBSS is thus $7,318 per QALY gained. In other words, to gain 1 QALY one must be willing to spend an additional $7,318 over CMM. 12Similar diagram for other pain pathologies

Incremental Cost-Effectiveness RatioDeterministic Sensitivity Analysis: Tornado Diagram for FBSSThe tornado diagram displays the results of the deterministic sensitivity analysis. It highlights the model parameters that most significantly affect the results of our cost-effectiveness analysis. The most important parameters in order of their influence are: 1) Probability of achieving an optimal health state with CMM 2) Cost of achieving a suboptimal health state with CMM and 3) Probability of achieving a suboptimal CMM health state after failing SCS trial. Thus adjusting these 3 variables will most significantly affect the analysis. 13

Probabilistic Sensitivity Analysis: ICER Scatter plot for FBSSThe incremental cost-effectiveness scatter plot diagrammatically represents the results of the probabilistic sensitivity analysis. The majority of simulations are tightly clustered, indicating good analytical validity. It is evident that SCS provides increased effectiveness (x-axis) but at an increased cost (y-axis) over CMM.

14Incremental Net Monetary Benefit of SCS over CMMThe incremental Net monetary benefit encapsulates the cost-effectiveness argument from the payers perspective. In fact, for any WTP threshold $7,000/QALY SCS generates a positive incremental net monetary benefit over CMM. For a program administrator deciding between two strategies, the incremental net monetary benefit tells you which strategy is better in terms of benefits relative to cost. The INMB is calculated by analyzing the difference in NMB between SCS and CMM. A positive incremental net monetary benefit indicates that SCS should be implemented over CMM for these patients with FBSS as the benefits of therapy outweigh the costs. There is a linear increase in incremental Net monetary benefit for SCS over CMM as WTP increases. At commonly accepted WTP thresholds, SCS generates a positive incremental net monetary benefit over CMM. The incremental net monetary benefit is calculated by subtracting the Net monetary benefit of each strategy (SCS and CMM in this case). The net monetary benefit of each strategy can be calculated by the following formula:Net monetary benefit = Effectiveness [(QALY) x WTP] Cost.

15Cost-Effectiveness Acceptability Curve: SCS over CMMThe cost-effectiveness acceptability curve is generated through our probabilistic simulations. Non-parametric bootstrapping methods were used to estimate the distribution of incremental costs and effects associated with SCS compared to CMM in order to generate the cost-effectiveness acceptability curve.

The cost-effectiveness acceptability curve represents the probability that SCS is a more cost-effective alternative to CMM at various willingness to pay thresholds. The willingness to pay threshold are plotted on the x-axis. The probability of cost-effectiveness (which ranges from 0-1) is plotted on the y-axis. For instance, at a willingness to pay threshold of $50,000 per QALY (a figure often cited) there is a 73% likelihood that SCS is more cost-effective to CMM in the management of FBSS.

16Strategy Selection FrequencyBased on a simulation of 50,000The strategy selection frequency indicates the proportion of simulations in which a strategy generated the most economical results. 64% of the time SCS was a more optimal strategy than CMM.

17Reliability of the Model:Expected Value of Perfect Information (EVPI)The strategy selection frequency indicates the proportion of simulations in which a strategy generated the most economical results. 64% of the time SCS was a more optimal strategy than CMM.

18Comparative Study of Rechargeable and Non-rechargeable IPGWe separately analyzed the cost-effectiveness of rechargeable (RestoreAdvanced) and non-rechargeable (PrimeAdvanced) IPGs. The lifespan of the non-rechargeable IPG is plotted on the x-axis while the Net monetary benefit is plotted on the y-axis. A positive NMB indicates that the benefits outweigh the costs.

From the graph is it is evident that the rechargeable IPG is the preferred solution if the lifespan of the non-rechargeable IPG is less than 4.25 years. 19ConclusionBased on our projections SCS will remain a cost-effective therapy in the management of neuropathic and ischemic pain in the year 2020

SCS provided a positive INMB over CMM at WTP thresholds $7,000 per QALY

The probability of SCS providing a cost-effective alternative to CMM ranged from 74-95%, depending on pathology and WTP

The rechargeable IPG is more cost-effective if the lifespan of a non-rechargeable IPG 4.25 years20