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Improving health worldwide www.lshtm.ac.uk Economic consequences of antimicrobial resistance Antimicrobial Resistance (AMR) in the Asia Pacific & Its impact on Singapore, Singapore, 13‐14 November 2018 Mark Jit 1,2,3 1 Department of Infectious Disease Epidemiology, London School of Hygiene & Tropical Medicine 2 Modelling and Economics Unit, Pubic Health England 3 School of Public Health, University of Hong Kong 04 December 2018 I have no conflicts of interest to declare.

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Page 1: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Improving health worldwide

www.lshtm.ac.uk

Economic consequences of antimicrobial resistance

Antimicrobial Resistance (AMR) in the Asia Pacific & Its impact on Singapore,

Singapore, 13‐14 November 2018

Mark Jit1,2,3

1Department of Infectious Disease Epidemiology, London School of Hygiene & Tropical Medicine

2Modelling and Economics Unit, Pubic Health England3School of Public Health, University of Hong Kong

04 December 2018I have no conflicts of interest to declare.

Page 2: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Overview

Why bother about the economic consequences of AMR?

How do we measure the cost of AMR? Hospital case‐control studies

Limitations of hospital studies

Capturing wider economic consequences

Page 3: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Economic goodsPrivate goods Common goods Public goods

Rivalrous, excludable Rivalrous, non‐excludable

Non‐rivalrous, non‐excludable

Page 4: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Antibiotic use

Antibiotic use and economic goods

Generates private goods to users 

(may expedite clearance of bacterial infection and recovery 

from illness)

Consumes global common goods

(antibiotic effectiveness is depleted)

Negative externality ‐ cost imposed on someone other 

than the user.

Page 5: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Because of this externality, a free market will not allocate resources around antibiotics and AMR optimally.

Market failure

Antibiotic consumption

Generates private goods, consumes common goods

Over‐consumption of antibiotics

R&D in new last‐resort antibiotics

Generates common 

goods but few immediate 

private goods

Under‐investment in antibiotic R&D

Infection control e.g. vaccines

Generates common goods by avoiding 

antibiotic use

Under‐investment in 

infection control

Page 6: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Governments can overcome market failure by policy instruments e.g. taxes, subsidies and regulations. 

However, the size of an efficient intervention must be calibrated to the size of the negative externality.

This requires accurate estimation of the economic cost of AMR.

Correcting market failure

Page 7: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

COST OF ILLNESS

HEALTH LOSS

OPTION A OPTION B

Economic evaluationsA (full) economic evaluation compares the incremental costs

and consequences of an intervention compared to a comparator

COST OF ILLNESS

HEALTH LOSS

COST OF INTER‐

VENTION

Page 8: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

COST OF ILLNESS

HEALTH LOSS

OPTION A OPTION B

Economic evaluationsA (full) economic evaluation compares the incremental costs

and consequences of an intervention compared to a comparator

COST OF ILLNESS

HEALTH LOSS

COST OF INTER‐

VENTION

AMR IMPACT

AMR IMPACT

Page 9: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Questions that we might address

Prioritisation in the AMR space

Should we invest in:

Antibiotic stewardship

R&D for an antibiotic

R&D for a vaccine that prevents a resistant

organism

Prioritisation in the infection prevention

space

Should we invest in:

Risk based vs universal screening for

neonatal GBS

Introduction of PCV vs rotavirus vaccine

Page 10: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Relationships

Antimicrobial use

Antimicrobial resistance

Health outcomes

Economic costs

Interventions 1

2 3

45

6

“Economic burden of AMR”

Page 11: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Cohen et al. Medical Care 2010; 48:767.

Difference in clinical outcomes, length of stay and costs between hospital patients with resistant vs. susceptible infections.

Cost of a resistant infection in hospital

Page 12: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Cost per resistant infection

Naylor et al. Antimicrobial Resistance and Infection Control 2018; 7:58.

Gandra et al. Clin Microbial Infect 2014; 20:973.

Page 13: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Residual confounding e.g. comorbidities Time dependent confounding (may be averted by 

multistate models) Confounding due to length of hospital stay prior to 

infection onset Appropriate counterfactual: sensitive case or no 

disease? Limited follow‐up time Limitations in time, space and economic perspective

Methodological challenges with hospital studies

Naylor et al. Antimicrobial Resistance and Infection Control 2018; 7:58Gandra et al. Clin Microbial Infect 2014; 20:973.

Page 14: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Expanding the cube

Extension in space from one hospital to 

national/global estimates

Extension in time from the present to 

the long‐term

Extension in perspective from the 

health care payer to societyAdditional cost of 

treating resistant cases in hospital‐based studies

Page 15: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Extrapolation in space

Number of hospital cases of resistant disease

Excess cost of treating one resistant case

+Excess cost of 

reduced productivity due to illness and 

premature death

=From hospital case‐control 

studiesFrom patient surveys and national 

statistics on income and workforce 

participation

Page 16: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

External validity: heterogeneity in case loads, care patterns, study populations, pathogen distribution etc.

Costs (esp. productivity) beyond the hospital:  Primary care Community (non‐medically attended 

illness)

Extrapolation in space: issues

Page 17: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

CDC infographic based on Marks et al. Emerg Inf Dis 2014.

Extension in timeExcess cost of treating resistant cases underestimates costs in the 

future when bacteria may acquire multiple resistances.

Page 18: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Extension in time

Resistance (and multi‐drug 

resistance) becomes more common.

Unit cost of treatment rises.

Classes of antibiotics become 

ineffective.

New antibiotics need to be developed.

Hospital procedures become risky to perform because 

infections cannot be treated.

Other procedures (e.g. surgery) become costly 

and dangerous.

Laxminarayan and Brown. J Environ Eco & Management 2001; 42:183.Smith and Coast. BMJ 2013; 346:f1493.

Infections spread more because infection control 

is more ineffective.

TODAY

Page 19: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Extension in perspective

Hospital perspective

• Cost of providing hospital care

Societal (microeconomic) perspective

• Out of pocket payments

• Health care outside hospital setting

• Productivity loss due to caregiving

• Productivity loss due to premature mortality

• Price of human suffering (valued using QALYs, DALYs or VSLs)

Societal (macroeconomic) perspective

• Loss in economic activity from reduced demand and labour supply due to both sicknessand to avoided economic activities (e.g. travel)

Page 20: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Macroeconomic impact of AMR

Antimicrobial resistance

Mortality

Morbidity

Labour supply

Economic output

Cost of goods

Demand for goods

Labour productivity

These relationships have been modelled using Computable General Equilibrium (CGE) methods (Smith et al., 2006) and Social Accounting Matrix (SAM) methods (KPMG, 2014).

Page 21: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Global/multinational estimates of AMR costsStudy Cost estimate Health impacts Economic impactsWorld Bank (2017)

$1‐3.4 trillion per year in 2030 (1.1‐3.8% of global GDP)

Increased mortality.

Reduced labour supply.

RAND (2014) $0.18 ‐ 9.8 trillion per year in 40 years (0.06 ‐3.06% of global GDP)

Increased mortality.

Reduced labour supply.

Increased morbidity.

Caregiving, workplace absence, reduced productivity.Reduced inter‐sectoral transactions and trade.

KPMG (2014) 1.66 ‐ 6.08% of global GDP in 2050

Increased mortality.

Reduced labour supply.

Increased morbidity.

Increased treatment costs, reduced productivity.Reduced economic production.

ECDC and EMA (2009)

€1.5 billion per year in the EU, Iceland and Norway (2009).

Increased morbidity.

Reduced labour supply.

Increased morbidity.

Increased treatment costs, reduced productivity.

Page 22: Economic Consequences of Antimicrobial Resistance Mark Jitnews.ntu.edu.sg/LKC/Documents/Economic_Consequences... · Mark Jit1,2,3 1Department of Infectious Disease Epidemiology, London

Conclusions

Understanding the economic cost of AMR is vital to inform interventions that can correct AMR‐related market failures.

Most studies are limited to short‐term health care provider costs for patients from a single hospital. These studies underestimate the total cost of AMR by ignoring future trends, non‐hospital costs and effects on the wider economy.

A few studies with extended scope, perspective and time horizon forecast the cost of AMR to be in $trillions by the mid‐21st century. However, they have had to rely on greatly simplified assumptions and data inputs.