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To identify parameters that drive the cost-effectiveness of precision medicine by comparing the use of multiplex targeted sequencing (MTS) to select targeted therapy based on tumour genomic profiles to either no further testing with chemotherapy or no further testing with best supportive care in the fourth-line treatment of metastatic lung adenocarcinoma.A combined decision tree and Markov model to compare costs, life-years, and quality-adjusted life-years over a ten-year time horizon from an Australian healthcare payer perspective. Data sources included the published literature and a population-based molecular cohort study (Cancer 2015). Uncertainty was assessed using deterministic sensitivity analyses and quantified by estimating expected value of perfect/partial perfect information. Uncertainty due to technological/scientific advancement was assessed through a number of plausible future scenario analyses.Point estimate incremental cost-effective ratios indicate that MTS is not cost-effective for selecting fourth-line treatment of metastatic lung adenocarcinoma. Lower mortality rates during testing and for true positive patients, lower health state utility values for progressive disease, and targeted therapy resulting in reductions in inpatient visits, however, all resulted in more favourable cost-effectiveness estimates for MTS. The expected value to decision makers of removing all current decision uncertainty was estimated to be between AUD 5,962,843 and AUD 13,196,451, indicating that additional research to reduce uncertainty may be a worthwhile investment. Plausible future scenarios analyses revealed limited improvements in cost-effectiveness under scenarios of improved test performance, decreased costs of testing/interpretation, and no biopsy costs/adverse events. Reductions in off-label targeted therapy costs, when considered together with the other scenarios did, however, indicate more favourable cost-effectiveness of MTS.As more clinical evidence is generated for MTS, the model developed should be revisited and cost-effectiveness re-estimated under different testing scenarios to further understand the value of precision medicine and its potential impact on the overall health budget.

Original publication





Lung cancer (Amsterdam, Netherlands)

Publication Date





22 - 35


Centre for Health Economics, Monash Business School, Monash University, Victoria 3800, Australia; Cambridge Centre for Health Service Research, University of Cambridge, Cambridge CB2 0SR, United Kingdom. Electronic address:


Humans, Adenocarcinoma, Lung Neoplasms, Disease Progression, Cohort Studies, Sequence Analysis, DNA, Genomics, Quality-Adjusted Life Years, Cost-Benefit Analysis, Australia, Molecular Targeted Therapy, Precision Medicine