Determinants of new drugs prescription in the Swiss healthcare market

Anne Decollogny, Romain Piaget-Rossel, Patrick Taffé, Yves Eggli

Drug markets are very complex and, while many new drugs are registered each year, little is known about what drives the prescription of these new drugs. This study attempts to lift the veil from this important subject by analyzing simultaneously the impact of several variables on the prescription of novelty. Data provided by four Swiss sickness funds were analyzed. These data included information about more than 470,000 insured, notably their drug intake. Outcome variable that captured novelty was the age of the drug prescribed. The overall variance in novelty was partitioned across five levels (substitutable drug market, patient, physician, region, and prescription) and the influence of several variables measured at each of these levels was assessed using a non-hierarchical multilevel model estimated by Bayesian Markov Chain Monte Carlo methods. More than 92% of the variation in novelty was explained at the substitutable drug market-level and at the prescription-level. Newer drugs were prescribed in markets that were costlier, less concentrated, included more insured, provided more drugs and included more active substances. Over-the-counter drugs were on average 12.5 years older while generic drugs were more than 15 years older than non-generics. Regional disparities in terms of age of prescribed drugs could reach 2.8 years. Regulation of the demand has low impact, with little variation explained at the patient-level and physician-level. In contrary, the market structure (e.g. end of patent with generic apparition, concurrence among producers) had a strong contribution to the variation of drugs ages.