Consider the following problem:
A relatively cheap drug (drug A) has been used for many years to treat patients with disease X. The drug is considered quite successful since data reveals that 85% of patients using it have a ‘good outcome’ which means they survive for at least 2 years. The drug is cheap and the overall “financial benefit” of the drug (which assumes a ‘good outcome’ is worth $5000 and is defined as this figure minus the cost) has a mean of $4985.On seeing the data the Health Authority recommends a ban against the use of drug B. Is this a rational decision?
There is an alternative drug (drug B) that a number of specialists in disease X strongly recommend. However, the data reveals that only 65% of patients using drug B survive for at least 2 years. Moreover, this drug is expensive. The overall “financial benefit” of the drug has a mean of just $2777.
The answer turns out to be no. This short paper explains this using a simple Bayesian network model that you can run (by downloading the free copy of AgenaRisk). Moreover, you can also compute the optimal decision automatically using the Hybrid Influence Diagram tool in AgenaRisk.
Fenton N.E. (2018) "A Bayesian Network and Influence Diagram for a simple example of Drug Economics Decision Making", DOI: https://doi.org/10.13140/RG.2.2.33659.77600