Formulary decisions and health economics

Because of increasing concerns about health care costs, physicians must consider the cost-effectiveness of a treatment strategy, as well as its efficacy and safety. The question of whether the greater expense of a newer drug is justified over the cost of a generic drug deserves a comprehensive evaluation. The determination of effectiveness and tolerability of the newer antipsychotics should be expanded to include quality-of-life issues, reintegration of the patient into the community, resource utilization, and medical costs. There are clear indications that patients who take atypical antipsychotics utilize fewer medical resources than patients who take typical antipsychotics; however, the positive outcomes of the newer drugs must be translated into cost benefits if formularies are to be intelligently controlled.