In an era of rising healthcare costs, simply knowing if a drug is effective is not enough; we must also assess its value. Pharmacoeconomics, a key topic in the Principles of Pharmacoeconomics course, provides the tools for this assessment. The Incremental Cost-Effectiveness Ratio (ICER) is a primary output of these analyses, representing the “cost per additional health outcome gained” and guiding formulary and policy decisions. This quiz will test your understanding of how to calculate, interpret, and apply the ICER in making evidence-based decisions about medication therapy.
1. Pharmacoeconomics is best defined as the field that:
- a. Only assesses the cost of medications.
- b. Only measures the clinical effectiveness of medications.
- c. Identifies, measures, and compares the costs and consequences of pharmaceutical products and services.
- d. Sets the price for new drugs coming to market.
Answer: c. Identifies, measures, and compares the costs and consequences of pharmaceutical products and services.
2. A Cost-Effectiveness Analysis (CEA) compares interventions whose costs are measured in dollars and whose outcomes are measured in:
- a. Dollars
- b. Quality-Adjusted Life Years (QALYs) only
- c. Natural health units (e.g., mmHg lowered, life-years saved, symptom-free days)
- d. A utility score
Answer: c. Natural health units (e.g., mmHg lowered, life-years saved, symptom-free days)
3. The Incremental Cost-Effectiveness Ratio (ICER) represents the:
- a. Total cost of a new therapy.
- b. Total effectiveness of a new therapy.
- c. Average cost per patient treated.
- d. Additional cost to gain one additional unit of health benefit when comparing two therapies.
Answer: d. Additional cost to gain one additional unit of health benefit when comparing two therapies.
4. What is the correct formula for calculating an ICER?
- a. (Cost_New + Cost_Old) / (Effect_New + Effect_Old)
- b. (Cost_New – Cost_Old) / (Effect_New – Effect_Old)
- c. (Cost_New / Effect_New) – (Cost_Old / Effect_Old)
- d. (Effect_New – Effect_Old) / (Cost_New – Cost_Old)
Answer: b. (Cost_New – Cost_Old) / (Effect_New – Effect_Old)
5. Drug A costs $1000 and provides 10 symptom-free days. Drug B costs $1500 and provides 15 symptom-free days. What is the ICER of Drug B compared to Drug A?
- a. $50 per symptom-free day
- b. $100 per symptom-free day
- c. $150 per symptom-free day
- d. $500 per symptom-free day
Answer: b. $100 per symptom-free day
6. A new drug is more effective and less expensive than the current standard of care. On the cost-effectiveness plane, this drug is considered:
- a. Dominant
- b. Dominated
- c. A trade-off
- d. Cost-ineffective
Answer: a. Dominant
7. A new drug is less effective and more expensive than the current standard of care. This drug is considered:
- a. Dominant
- b. Dominated
- c. A trade-off
- d. Cost-effective
Answer: b. Dominated
8. A new drug is more effective but also more expensive than the standard therapy. An ICER calculation is needed to determine if it is:
- a. Clinically superior.
- b. Cost-effective.
- c. The new gold standard.
- d. A dominant option.
Answer: b. Cost-effective.
9. A “Willingness-to-Pay” (WTP) threshold represents:
- a. The price the manufacturer sets for the drug.
- b. The maximum amount a payer (like society or an insurance company) is willing to spend to gain one unit of health effect.
- c. The patient’s copay.
- d. The acquisition cost of the drug.
Answer: b. The maximum amount a payer (like society or an insurance company) is willing to spend to gain one unit of health effect.
10. A new therapy has an ICER of $75,000 per QALY gained. If the societal Willingness-to-Pay threshold is $100,000 per QALY, this therapy is considered:
- a. Not cost-effective
- b. Dominated
- c. Cost-effective
- d. Dominant
Answer: c. Cost-effective
11. The course PHA5267 Principles of Pharmacoeconomics is part of the PharmD curriculum.
- a. True
- b. False
Answer: a. True
12. A Cost-Utility Analysis (CUA) is a specific type of CEA where the health outcome is measured in:
- a. Dollars saved
- b. Life-years gained
- c. Quality-Adjusted Life Years (QALYs)
- d. Cases cured
Answer: c. Quality-Adjusted Life Years (QALYs)
13. How is a QALY calculated?
- a. The number of years of life gained multiplied by a utility score representing the quality of that life.
- b. The total cost of care divided by the years of life.
- c. The patient’s age minus their life expectancy.
- d. A survey of patient satisfaction.
Answer: a. The number of years of life gained multiplied by a utility score representing the quality of that life.
14. A utility score of 1.0 represents _____, while a score of 0 represents _____.
- a. death, perfect health
- b. perfect health, death
- c. moderate health, severe disability
- d. severe disability, moderate health
Answer: b. perfect health, death
15. The main advantage of using QALYs as an outcome measure is that they:
- a. Are easier to measure than blood pressure.
- b. Allow for the comparison of interventions across different disease states.
- c. Are always cheaper to calculate.
- d. Are not subjective.
Answer: b. Allow for the comparison of interventions across different disease states.
16. Which type of pharmacoeconomic analysis should be used when two drugs are proven to have equivalent efficacy and safety?
- a. Cost-Benefit Analysis (CBA)
- b. Cost-Effectiveness Analysis (CEA)
- c. Cost-Utility Analysis (CUA)
- d. Cost-Minimization Analysis (CMA)
Answer: d. Cost-Minimization Analysis (CMA)
17. The pharmacist’s role in pharmacoeconomics often involves:
- a. Setting the price of medications for the manufacturer.
- b. Conducting clinical trials.
- c. Serving on Pharmacy & Therapeutics (P&T) committees to make formulary decisions using pharmacoeconomic data.
- d. Only dispensing medications.
Answer: c. Serving on Pharmacy & Therapeutics (P&T) committees to make formulary decisions using pharmacoeconomic data.
18. In the ICER formula, ΔC / ΔE, what does ΔC represent?
- a. The change in cholesterol.
- b. The change in cost between two alternatives.
- c. The total cost of the new drug.
- d. The change in clinical effectiveness.
Answer: b. The change in cost between two alternatives.
19. A study comparing a new cancer drug to an old one measures outcomes in “life-years gained.” This is an example of what type of analysis?
- a. Cost-Benefit Analysis
- b. Cost-Minimization Analysis
- c. Cost-Effectiveness Analysis
- d. Cost-Consequence Analysis
Answer: c. Cost-Effectiveness Analysis
20. A “sensitivity analysis” is performed in a pharmacoeconomic study to:
- a. Determine if the drug causes allergic reactions.
- b. Test how robust the results are when key variables (like drug cost or effectiveness) are changed.
- c. Ensure the correct patients were enrolled.
- d. Calculate the p-value.
Answer: b. Test how robust the results are when key variables (like drug cost or effectiveness) are changed.
21. A new drug costs $5,000 more than the standard drug and provides an additional 0.2 QALYs. What is the ICER?
- a. $1,000 per QALY
- b. $10,000 per QALY
- c. $25,000 per QALY
- d. $50,000 per QALY
Answer: c. $25,000 per QALY
22. Which of the following is an example of a direct medical cost?
- a. Lost productivity from being sick.
- b. The cost of a hospital stay.
- c. Travel costs to and from appointments.
- d. Pain and suffering.
Answer: b. The cost of a hospital stay.
23. Which of the following is an example of an indirect cost?
- a. The cost of a prescription medication.
- b. A patient’s lost wages from being unable to work due to illness.
- c. The cost of a lab test.
- d. A physician’s office visit fee.
Answer: b. A patient’s lost wages from being unable to work due to illness.
24. The perspective of a pharmacoeconomic analysis (e.g., societal, hospital, third-party payer) is important because it:
- a. Does not affect the results.
- b. Determines which costs and consequences are included in the analysis.
- c. Only matters for cost-benefit analyses.
- d. Is chosen by the drug manufacturer.
Answer: b. Determines which costs and consequences are included in the analysis.
25. A Cost-Benefit Analysis (CBA) is unique because it measures both costs and health benefits in what units?
- a. QALYs
- b. Natural units
- c. Monetary units (dollars)
- d. Life-years saved
Answer: c. Monetary units (dollars)
26. The main challenge of performing a Cost-Benefit Analysis is:
- a. It is difficult to place a monetary value on a human life or health outcome.
- b. It is less accurate than a CEA.
- c. The calculations are too simple.
- d. It cannot be used to compare different programs.
Answer: a. It is difficult to place a monetary value on a human life or health outcome.
27. An ICER is most useful for decision-making when a new drug is:
- a. More effective and less expensive.
- b. Less effective and more expensive.
- c. More effective and more expensive.
- d. Equally effective and equally expensive.
Answer: c. More effective and more expensive.
28. If a new treatment is dominant, its ICER value would be:
- a. A large positive number.
- b. A negative number (representing a cost saving for a health gain).
- c. Zero.
- d. An ICER is not calculated for dominant treatments.
Answer: d. An ICER is not calculated for dominant treatments.
29. The “fourth quadrant” of the cost-effectiveness plane represents treatments that are:
- a. More effective, more costly.
- b. More effective, less costly (dominant).
- c. Less effective, less costly.
- d. Less effective, more costly (dominated).
Answer: c. Less effective, less costly.
30. The “Medication Affordability” transcending concept is part of the Patient Care 5 curriculum.
- a. True
- b. False
Answer: a. True
31. The results of pharmacoeconomic studies are often used by:
- a. Individual patients to choose their therapy.
- b. P&T committees to make formulary decisions.
- c. Government payers and insurance companies to make coverage decisions.
- d. Both b and c.
Answer: d. Both b and c.
32. A clinical practice guideline that incorporates cost-effectiveness data is following the principles of Evidence-Based Practice.
- a. True
- b. False
Answer: a. True
33. The “effectiveness” data used in a CEA should ideally come from:
- a. A single case report.
- b. The manufacturer’s marketing claims.
- c. High-quality randomized controlled trials or real-world evidence.
- d. Expert opinion only.
Answer: c. High-quality randomized controlled trials or real-world evidence.
34. The term “incremental” in ICER refers to:
- a. The total cost and total effect.
- b. The additional cost and additional effect of one intervention over another.
- c. A small, unimportant difference.
- d. A slow increase in cost over time.
Answer: b. The additional cost and additional effect of one intervention over another.
35. A pharmacist working in managed care or for a PBM would frequently use pharmacoeconomic analyses.
- a. True
- b. False
Answer: a. True
36. A limitation of pharmacoeconomic studies is that:
- a. The results are always certain and do not change.
- b. The results can be influenced by the assumptions and perspective of the model.
- c. They are not useful for decision-making.
- d. They only consider drug acquisition cost.
Answer: b. The results can be influenced by the assumptions and perspective of the model.
37. The “E” in the ICER equation (ΔC / ΔE) stands for:
- a. Economics
- b. Efficacy
- c. Effectiveness
- d. Excretion
Answer: c. Effectiveness
38. Efficacy, as measured in an RCT, may differ from effectiveness, which is measured in:
- a. A laboratory setting.
- b. A real-world clinical practice setting.
- c. A single patient.
- d. An animal model.
Answer: b. A real-world clinical practice setting.
39. A pharmacoeconomic analysis from the “societal perspective” would include which of the following costs?
- a. Drug acquisition costs.
- b. Hospitalization costs.
- c. Patient’s lost productivity and caregiver costs.
- d. All of the above.
Answer: d. All of the above.
40. A new therapy has an ICER of $200,000 per QALY. Given a typical WTP threshold of $50,000-$150,000/QALY, this therapy would likely be considered:
- a. Highly cost-effective
- b. Cost-effective
- c. Not cost-effective
- d. A dominant therapy
Answer: c. Not cost-effective
41. The primary role of a pharmacist on a P&T committee is to evaluate a new drug based on:
- a. Clinical evidence (efficacy and safety).
- b. Pharmacoeconomic evidence (value).
- c. Both a and b.
- d. The manufacturer’s marketing presentation only.
Answer: c. Both a and b.
42. A drug that extends a patient’s life by one year in a state of perfect health provides how many QALYs?
- a. 0
- b. 0.5
- c. 1
- d. 2
Answer: c. 1
43. A drug that extends a patient’s life by two years in a health state valued at 0.5 utility provides how many QALYs?
- a. 0.5
- b. 1
- c. 1.5
- d. 2
Answer: b. 1
44. If two drugs have the same cost but one is more effective, the more effective drug is:
- a. Dominated
- b. Always cost-effective without needing an ICER.
- c. A trade-off.
- d. Not cost-effective.
Answer: b. Always cost-effective without needing an ICER.
45. Which of the following is an intangible cost?
- a. The cost of a prescription.
- b. The cost of a lab test.
- c. The cost of pain and suffering.
- d. The cost of transportation to a clinic.
Answer: c. The cost of pain and suffering.
46. “Discounting” in a pharmacoeconomic analysis refers to:
- a. A coupon provided by the manufacturer.
- b. Adjusting future costs and benefits to their present value.
- c. Ignoring costs that occur in the future.
- d. A reduction in the drug’s list price.
Answer: b. Adjusting future costs and benefits to their present value.
47. A pharmacist is an essential professional for interpreting and applying pharmacoeconomic data in clinical practice.
- a. True
- b. False
Answer: a. True
48. An ICER is calculated when comparing how many therapies at a time?
- a. One
- b. Two
- c. Three
- d. As many as needed.
Answer: b. Two
49. The overall goal of pharmacoeconomics is to help allocate:
- a. As many resources as possible to pharmaceuticals.
- b. Limited healthcare resources in an efficient and effective manner.
- c. Resources based on physician preference only.
- d. Resources to the newest technologies, regardless of value.
Answer: b. Limited healthcare resources in an efficient and effective manner.
50. The ultimate reason to learn about pharmacoeconomics and ICERs is to:
- a. Understand and contribute to decisions that promote value-based healthcare.
- b. Pass the pharmacoeconomics exam.
- c. Be able to calculate QALYs by hand.
- d. Only work in the pharmaceutical industry.
Answer: a. Understand and contribute to decisions that promote value-based healthcare.