Graham Cookson, CEO, tells Healthcare World how the Office of Health Economics informs how to maximise health gain per dollar
Populations are ageing rapidly and multiple, complex illnesses are becoming more common, creating a perfect storm for healthcare systems. These pressures stretch already tight budgets and demand innovative solutions to persue sustainable, effective care for all. The challenge is clear, but so is the opportunity to rethink how we deliver and fund healthcare.
How to make choices and trade-offs is therefore key in healthcare – especially when these choices can mean life or death. That’s where health economics comes in: it identifies interventions that deliver the most health for every dollar, maximising impact from limited budgets.
The Office of Health Economics (OHE) is
a pioneer in the field. As the world’s oldest independent health economics research organisation, we have been at the forefront of the field for over 60 years. Every day, we work with governments, pharmaceutical companies and patient groups across the world to address the most urgent questions in healthcare – from the cost of drug shortages to improving efficiency in primary care.
We’re globally renowned for delivering independent insights that shape health policy and drive innovation. With 27 per cent of our research cited in international guidelines—far above the 6 per cent global average—our impact speaks for itself.
Focussing on prevention
As populations around the world get older and progressively sicker, it’s imperative that we pivot to viewing health as a long-term investment in society. Current healthcare budgets are overstretched on treating and managing preventable conditions.
Prevention – which we know has a median return on investment exceeding 14:1 – has to be a critical cornerstone of any healthcare system.
OHE has worked with government and industry stakeholders to make expert, evidence-led policy proposals focussed on investing in prevention. In 2024, we published a ‘first-of-its-kind’ study across ten countries in Asia, Australia, Europe and the Americas, commissioned by the International Federation of Pharmaceutical Manufacturers (IFPMA). That study showed adult immunisation programmes return up to 19 times their initial investment to society when their significant benefits beyond the healthcare system are monetised. This is the equivalent of up to $4,637 returned to society for one individual’s full vaccination course – and altogether, billions of dollars in net monetary benefits to society.
In the UK, the NHS spends £10 billion a year on diabetes – 10 per cent of its budget. This number is expected to rise to almost £17 billion over the next 25 years. Of this current expenditure, nearly 80 per cent of diabetes spending is on complications – many of which are preventable.
A landmark report at OHE highlighted that although the NHS’ diabetes prevention programme is both cost-effective and successful in reducing the chance of developing diabetes by 37 per cent, only 200,000 people per year are able to access it – a mere drop in the ocean compared to the 13.6m people who are eligible for it.
Investment in prevention should unequivocally be one of the most critical elements of a healthcare system – the focus should be on spending enough to reduce preventable ill health which will then lead to lower overall strain on the healthcare system. OHE research identifies opportunities for maximised health via preventative care, and guides governments and policymakers towards smarter, actionable interventions that have a net benefit for both societal health and the economy.
Asking the right questions
Better outcomes require better evaluation of processes. Waste and inefficiency in healthcare systems is widespread — as much as one-fifth of the European GDP healthcare spending is spent on interventions that made no meaningful contribution to health outcomes. Our research highlighted innovation as a tool to increase efficiency and identified nine potential barriers that prevent the adoption of innovative health technologies. A major part of this is multistakeholder partnerships – we’ve found that interlocking problems require multilateral collaboration, an ethos that underpins all our work.
OHE is a global thought leader in the economics of pharmaceutical innovation. As a ‘critical friend’, we bridge perspectives and incentives of healthcare payers and the pharmaceutical industry to identify innovative, actionable solutions.
A key part of finding the right solutions is asking the right questions. Much has been said in the UK about the need to drive productivity in the healthcare system, which is critical to the NHS’s long-term sustainability. However, a major part of addressing this is how productivity is measured. Recent OHE research proposed a new ‘valued output’ framework for measuring health system performance that focussed on what society values from a healthcare system: increased health outputs.
What we measure matters. A more productive healthcare system should necessarily mean a healthier society. Unfortunately, most healthcare systems use outdated and inadequate measures of performance that lead to perverse incentives, rather than improved health outcomes.
Our research focusses on delivering evidence-based policy suggestions to improve processes, build capacity and future-proof health systems that ultimately lead to fairer, healthier societies.
Expert insights and collaboration
At OHE, we tackle the challenges you haven’t heard of – until we’ve solved them. We know many pressing problems that emerge in the healthcare system often fall outside the remit of the sector, whether that’s the impact of the climate crisis or the roll-on effects of poverty and social disparities. That’s why we prioritise collaborating with stakeholders across sectors and around the world to anticipate the biggest questions of tomorrow and address them today.
Our work has real impact – it leads to better policies, smarter choices, and healthier futures.
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