Thesis summary
Background
Most diabetics eventually require exogenous insulin injections in order to achieve adequate glycemic (blood sugar) control. Nowadays the syringes look like pencils, and their fitted needles are very small.
Despite this fact, some diabetic patients appear to be hesitant to use insulin, and – consequently – remain in poor glycemic control followed by an increased risk of damaging vital parts of the body. Needle anxiety is one of the factors associated with this reluctance. So far the alternatives to injections have been limited and only aimed at certain groups of diabetic patients. However, within the last couple of years a new route of insulin administration has been developed; namely inhaled insulin administered by means of a handheld inhalator.
Due to technicalities inhaled insulin is more expensive than subcutaneous insulin – one of the reasons why it is not included in any reimbursement system in Europe.
Objective
The main objective of the thesis is to determine, how Danish diabetics value the different insulin administration systems. More specifically, the purpose is to determine diabetic patients’ willingness-to-pay (WTP) for inhaled and subcutaneous administered insulin respectively. Furthermore, the valuation of different characteristics describing the two systems are highlighted. Finally, the impact of the results are analysed in a hypothetical market.
Methods
The thesis is based on a discrete choice experiment (DCE) designed and conducted by the authors. Data is collected by a mailed questionnaire, which was sent to 400 adult diabetics in Denmark.
DCE is a stated preferences method often used to elicit preferences for non-marketed goods. The theoretical foundation of DCE is a combination of random utility theory, neoclassical economic theory and Lancaster’s consumer theory, which states that the value of a good is determined by the sum of the values of its different characteristics.
In DCE respondents are asked to make a sequence of hypothetical choices among two or more alternatives. The alternatives are described by a number of attributes. The levels of the attributes are assigned by a systematic process called experimental design. Each time a level changes, a new alternative arises. This way the respondents’ latent utility functions are revealed – containing information about the valuation of different characteristics of the good in question. In the present study the alternatives (pen and inhalator) are described by the attributes size, integrated insulin diary, automatic measurement of blood sugar (pen only), mild cough (inhalator only) and out-of-pocket payment. The utility parameters are estimated by a conditional logit model. The statistical software package Stata is used for estimation.
Results
The final sample consists of 298 diabetics out of which 104 are diagnosed with type 1 and 196 are diagnosed with type 2 diabetes. 57 per cent of the respondents are women and 43 per cent are men. The average age is 49 years.
At equal prices a majority – 60 per cent – state that they prefer to administer insulin subcutaneously. The percentage of respondents, who choose inhalator, is – as expected – biggest amongst diabetics, who do not use insulin.
When asked directly. the average, monthly willingness-to-pay for inhaled insulin is 262 DKR – about the same level as the respondents’ current out-of-pocket payment for diabetes-related medicine. In DCE the average, monthly willingness-to-pay for the inhaled insulin system is 397 DKR. If the inhalator is half the size of the current prototype, the willingness-to-pay rises to 444 DKR. However, the average, monthly willingness-to-pay for subcutaneous administered insulin is 1108 DKR – and 1279 DKR if the insulin pen has a built-in blood sugar measurer.
In general, type 1 diabetic patients have the biggest willingness-to-pay for both inhaled and subcutaneously administered insulin.
The two alternative-specific attributes – blood sugar measurer and cough – have a significant impact on the respondents’ utility function, and are important reasons why pen is preferred to inhalator. However, the constant term is still the largest component in total WTP for pen.
In a hypothetical market the inhaled insulin administration system has a market share of only 7.5 per cent. Assuming equal prices, the share rises to 22 per cent – indicating that price is an important factor in diabetics’ choice among different insulin administration systems.
In general, the price and the size of the inhalator appear to be the two most significant obstacles for widespread use of the inhaled insulin administration system in Denmark.
Conclusion
As opposed to results of similar foreign studies Danish diabetics are not willing to pay an additional amount of money for the inhaled insulin administration system. The utility associated with the characteristics of the inhalator do not justify a higher price for this alternative. However, at equal prices the inhalator is expected to do pretty well on the Danish market for insulin. Especially, the inhalator will be attractive to new insulin-users.
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