Socio-economics
Socio-economics is about showing how investing in health can free up resources for other social development purposes. This is particularly relevant for diabetes, where many studies - including several conducted by Novo Nordisk - show that the cost of not treating diabetes is much greater than the cost of proper treatment. This is particularly true in the developing world, where 80% of new cases are expected to emerge in the next 20 years. With healthcare spending rising faster than GDP in many countries, governments are looking for ways to reduce direct healthcare costs. Socio-economic calculations provide evidence that investing in proper disease management reduces costs to both individuals and society due to fewer complications, higher productivity and increased quality of life.
Performance 2006
For several years we have worked to develop a broad understanding of the socio-economic impact of diabetes, both to enhance our knowledge of how we can change diabetes and to provide information and insight to other stakeholders that have an impact on diabetes.
There is a gap between the treatment received by patients and the treatment that could be offered by the healthcare system with the current scientific evidence and knowledge of good practice. The socio-economic programme has developed a framework within which this gap can be analysed. The cost and human consequences for people with diabetes of the existing gap as well as the benefits gained by closing the gap in the healthcare system, are integrated elements in the analysis.
In 2006 the results of our socio-economic work are illustrated in a number of studies and publications:
- Publication of the brochure ‘Changing the Cost and Benefits of Diabetes’ . It addresses the socio-economic implications of the status quo; what we refer to as the 'rule of halves': Of all people with diabetes only half are diagnosed; among those diagnosed only half receive appropriate care; of these only half reach desired treatment targets; and finally only half of these achieve blood sugar control in line with treatment guidelines.
- Publication of a study outlining how better prevention and treatment of diabetes could save up to half of the estimated 13 billion Danish kroner (2.2 billion US dollars) spent in Denmark each year on the treatment of diabetes and its complications. (Methodology. Type 1 diabetes. Type 2 diabetes).
The study was prepared by researchers at the University of Southern Denmark and Aarhus University in collaboration with Novo Nordisk and presented in connection with the 2006 annual meeting of the European Association for the Study of Diabetes (EASD). - An ongoing study in the Netherlands looking at the socio-economic impact of the 'Dutch model' of innovation in diabetes care. The model includes a national diabetes strategy, focusing on the concept of diabetes care shared between primary and secondary healthcare, and diabetes passports that enhance communication between people with diabetes and healthcare providers. Novo Nordisk has contributed to developing the model. However, making a socio-economic assessment of the impact of the programme is difficult, because in the Netherlands - as in many other countries - currently available data is largely incomplete and unreliable for assessment of healthcare quality, quantity and costs. New and better data collection systems are needed. These are being implemented by a group of internists in the Netherlands, and the collected data will be used as the study progresses.
- Support of a health survey in Kerala, India, which is being conducted by a project called 'Health Action by People' to track the level of diabetes care among more than 120,000 people (covering 43,000 households) in rural areas - a population that is rarely studied. 'Health Action by People' has developed a unique concept, including the use of microfinance. Semi-skilled nurses are trained in basic healthcare, and provided with a small loan to buy a scooter and a blood glucose machine. They charge a nominal amount for the blood test - affordable for even the poorest villagers - and this income enables the nurses to repay the loan and to earn a living. The survey will shed light on aspects of diabetes and diabetes care in India that Novo Nordisk will use in its socio-economic studies and to better understand how the company can change diabetes care in the developing world.
Novo Nordisk’s approach
A fundamental issue in our socio-economic work is how diabetes will impact the developing countries’ ability to grow and develop. The disease hits doubly by impeding people’s productive abilities as well as being costly to treat and to provide care for.
Low- and middle-income countries often lack the healthcare infrastructure to meet the needs of a growing number of people with diabetes. Lack of awareness and education about diabetes is a serious concern in the developing world but also persists in the rest of the world.
To gain a better understanding of the economic costs of diabetes care in both the developing and developed world, Novo Nordisk has worked with partners at the University of Southern Denmark to develop a framework for assessing the societal impact of chronic diseases such as diabetes and has made studies of the socio-economic consequences of diabetes. See study of cost of diabetes in Bangladesh, type 2 diabetes.
These studies indicate that as much as 75% of the cost of diabetes may be indirect costs due to complications. See a comparative analysis of the socio economics of diabetes treatment in Bangladesh and Denmark.
These studies differ from conventional health economics studies by:- Including all people with diabetes, not just those using specific drugs or receiving specific treatment
- Including all costs related to living with diabetes, both healthcare and non-healthcare costs
- Looking at the societal costs and benefits of investing in health. Does it pay to take a long-term perspective by investing in health rather than the short-term perspective of looking at healthcare as a cost to society?
What the studies have shown us is that additional investments in better treatment at an early stage of diabetes are offset by lower costs to society in the future due to fewer complications (lower hospitalisation costs, less nursing of irreversible disabilities and higher productivity). The socio-economic consequences are reflected in Novo Nordisk's current strategy and based on the objective of preventing complications from developing into an irreversible stage where only daily care and nursing homes can be offered.
This page has been assessed by PricewaterhouseCoopers as part of its assessment of Novo Nordisk’s statement that it reports ‘in accordance’ with GRI. Please refer to Audit and assurance for a full description of the nature of assurance offered.
