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Cost of Illness of Multiple Sclerosis in Isfahan, Iran, From a Social Perspective:

A Comparison of the Human-Capital and Friction-Cost Methods

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 Economic Evaluation
- Contents lists available at sciencedirect.com
Journal homepage: www.elsevier.com/locate/vhri

Cost of Illness of Multiple Sclerosis in Isfahan, Iran, From a Social

Perspective: A Comparison of the Human-Capital and Friction-Cost
Methods
Mohammadreza Amirsadri, PharmD, PhD, Farimah Rahimi, PhD, Azin Khajepour, PharmD

A B S T R A C T

Objectives: Multiple sclerosis (MS) is a chronic autoimmune disease of the central nervous system that is characterized by
demyelination and neurodegenerative changes and associated with high levels of disability. This study aimed to investigate
direct and indirect costs of illness of patients with MS in Isfahan using and comparing human-capital and friction-cost
methods from a societal perspective.
Methods: A total of 300 patients with MS of 2 main centers of the disease in Isfahan, the MS center of Ayatollah Kashani
hospital and Isfahan MS center, were included. Patient’s demographic characteristics, disease information, and annual social
costs (2018-2019) were collected using data collection form. Both the human-capital and friction-cost methods were applied
and compared with value indirect costs because of loss of productivity.
Results: From the social perspective, the average annual total cost of MS disease was estimated to be 1 441163 710 rials (34 313
US dollar [USD]) per patient using the human-capital approach and 1 434 832 004 rials (34 162 USD) with the use of friction-
cost method, from which 1 428 668 396 rials (34 016 USD) was related to direct costs. The main direct costs were related to
disease-modifying therapies and referring to other physicians and hospitals. The cost of loss of production was greater with
human-capital approach in comparison with friction-cost method.
Conclusions: The most prominent cost in MS disease is related to drug costs. The indirect costs were sensitive to the methods,
applied in the study.

Keywords: direct cost, friction-cost, human-capital, multiple sclerosis.

VALUE HEALTH REG ISSUES. 2022; 30:26–30

Introduction the primary progressive MS in which the onset of the

Multiple sclerosis (MS) is a chronic autoimmune disease of the
central nervous system that is characterized by demyelination and
neurodegenerative changes and associated with high levels of
disability.1,2 Vision problems, impaired mobility, fatigue, sexual
disorders, and cognitive problems are among the most important
manifestations of MS that differ among patients.3,4 The onset of
MS is typically in young adults, ranging from 20 to 40 years of age,
and women are affected more than men, with a ratio of approx-
imately 2:1.5,6
There are several forms of MS in which the course of the
condition may vary. The most common form is relapsing–
remitting MS (RRMS) that involves approximately 85% to 90%
of all patients.7,8 The neurological symptoms of the condition
exacerbate periodically and recover partially or completely in
the RRMS. It is reported that after 10 to 15 years of the dis-
ease, most patients with RRMS enter the secondary progres-
sive MS, as the symptoms progress between relapses or persist
after relapses. Approximately 5% to 10% of patients experience
condition is coincided with progressive neurological
disabilities.7,8
Interferon b1a and b1b, glatiramer-acetate, teriflunomide,
dimethyl-fumarate, fingolimod, natalizumab, and alemtuzumab
have been introduced as the most frequently used drugs for
disease-modifying therapies (DMTs). Although MS is currently
considered incurable, the use of DMTs is recommended for
treating different kinds of MS, from mild to aggressive forms of the
condition.9–11
Epidemiological studies revealed that MS is one of the most
frequent neurological diseases with the estimated prevalence of
.2.3 million people worldwide.12 The prevalence rate reported for
this condition ranges from 0.77 to 128 cases per 100 000 people
worldwide.8,13,14 Isfahan province, Iran, is reported as a region
with the highest prevalence of the disease (89 cases per 100 000
persons) in the country, with a 3.37:1 ratio of women to men.15–17
It is indicated that the incidence rate of MS in Isfahan (12.8 per
100 000 population) is significantly higher than other parts of the
country.18

2212-1099/$36.00 - see front matter ª 2021 ISPOR–The professional society for health economics and outcomes research. Published by Elsevier Inc.
 ECONOMIC EVALUATION 27

Given that MS onset is generally in the most productive years Table 1. Demographic and disease data of the patients.
of life, it has major effects on the patients and their caregiver’s
health-related quality of life and their productivity,19,20 including
Characteristics n (%)
repeated hospitalization because of the exacerbations of the dis-
ease, referring to healthcare centers because of a variety of Patients (n) 300 (100)
Mean age 33.05
neurological, visual, motor, cognitive, and sexual disabilities,
Women’s proportion 228 (76)
which may lead to absenteeism and even permanent withdrawal Men’s proportion 72 (24)
from work. Consequently, all these effects should be taken into
Type of MS
account from a societal point of view.21–23
Relapsing–remitting 234 (78)
Previous studies shown that cost of the medications is higher in
Secondary progressive 66 (22)
patients with mild disabilities and nonmedical direct and indirect
costs become more dominant with the progression of disabilities to Marriage status
Married 204 (68)
severe stages.20,24–26 What is challenging in the management of MS
Single 78 (26)
costs is the annual increase in overall costs of the disease, including Divorced 6 (2)
the medical costs as the main driver of costs, which can ultimately Died wife/husband 6 (2)
impose a negative impact on treatment of the patients.21,27 A Missed Data 6 (2)
detailed and continuous report of MS costs can provide valuable
Education
information for estimating the economic burden of the condition. High school 54 (18)
Therefore, cost of illness studies help the healthcare systems to Diploma/associate degree 156 (52)
benefit from better decision-making processes and to design their Bachelor of science 72 (24)
policies for supporting patients with MS and their families. Master of science and higher 18 (6)
This study aimed to investigate direct and indirect costs of Living status
illness of patients with MS in Isfahan, as a province with highest Live alone 12 (4)
prevalence of the disease, from the societal perspective. In addi- Live with parents 78 (26)
tion, 2 main approaches for the evaluation of indirect costs, the Live with children without wife/husband 6 (2)
human-capital and friction-cost, were applied and compared in Live with children with wife/husband 204 (68)
the current study for a better understanding of the effect of the Relapses during last year
costing method. Having relapses 96 (32)
No relapses 204 (68)

MS indicates multiple sclerosis.

Methods

This study was a prevalence-based, cross-sectional cost of

illness work in which the costs of the disease were estimated in a
1-year period of time, regardless of when the condition was
appeared. The information of the cost categories was gathered
directly from participants using the bottom-up technique. The
costs were sourced from the tariff book published by the Iranian
Ministry of health.28
Participants of the study were 300 of the patients with MS of 2
main centers of the disease in Isfahan, the MS center of Ayatollah
Kashani hospital and the Isfahan MS center, whose disease was
diagnosed at least 1 year before and have used at least one of the
main medications for the disease (DMTs) in the past year. No limit
in terms of severity or phase of the disease was considered as
inclusion criteria. The 2 mentioned centers are referral centers for
patients with MS in Isfahan province and deliver service to pa-
tients from different geographical parts of the province, which
include different socioeconomic levels. Sampling was performed
from all patients referred to the 2 centers who agreed to partici-
pate in the study within the study time period until reaching the
ceiling of 300 people. Demographic characteristics, disease infor-
mation, and social costs of the patients were collected for the 2018
to 2019 time period. Demographic data consisted of age, sex, ed-
ucation, and marital and job status. Questions of the disease in-
formation were about the time of onset and duration of MS and
type of the condition. The data of social costs were categorized as
direct and indirect costs and collected via a number of questions
related to used or lost resources. Costs of medications, hospitali-
zations, prescriptions, diagnostics, nursing care, consultations,
transportation, and rehabilitation measures were known as direct
costs. The indirect costs included temporary and permanent loss
of production, for example, early retirement, sick absences, and
premature death. The online Appendix 1 provides the data
collection form of the study.
Both the human-capital and friction-cost methods were
applied to evaluate indirect costs. Human-capital method refer to
mean national wage paid for workdays lost. Nevertheless, friction-
cost method implies to short-term costs incurred by employers in
replacing a lost worker, including the costs of temporary sub-
stitutes, and recruiting and training a new worker.29
The data were collected via interview with the patients after
providing a written consent for participating in the study. An
exchange rate of 42 000 rials for each US dollar (USD) was used in
the study. Direct costs, which include medical and nonmedical
costs, were reported as average per patient. Similarly for indirect
costs, the average indirect costs were reported per patient for both
human-capital and friction-cost methods. The SPSS software
version 20 (SPSS Inc, Chicago, IL) was used to analyze and average
data.
Results
A total of 300 patients (76% women and 24% men) from the 2
MS centers provided valuable data in interviews. The mean age of
the patients at the time of the survey was 33.05 years (ranged
from 14 to 60). On average, 4 years had elapsed since the onset of
the disease among the patients. In 136 patients (40%), 1 to 2 years
had passed since the onset of the disease whereas in 59 of them
(20%) 2 to 4 years had elapsed since the onset of the disease. In
other patients, .4 years had passed since the onset of the disease.
Relapsing–remitting form was the most common type of MS
among the participants (78%). A total of 32% of the patients
experienced relapses in symptoms during the last year that lasted
for a mean of approximately 22 days for each subject. The de-
mographic and disease details of the study samples are presented
28 VALUE IN HEALTH REGIONAL ISSUES
Figure 1. Components of the direct-medical costs.
DMT indicates disease-modifying therapy.
in Table 1. Among the participants, 180 patients had a 90%
coverage of insurance and 120 patients had less or no coverage of
insurance in any kind.
The total average annual cost of the MS condition from the
societal perspective for each patient was estimated to be
1 441163 710 rials (34 313 USD) and 1 434 832 004 rials (34 162
USD) with the use of human-capital and friction-cost approaches,
respectively. The direct cost was 1 428 668 396 rials (34 016 USD)
per year for each patient from which 1 391 306 396 rials (33 126
USD) was related to the direct-medical costs and 37 362 000 rials
(890 USD) was related to the direct nonmedical costs.
The main direct-medical costs were related to DMTs with
855150 000 rials (20 361 USD) per patient. Moreover, there were
some complementary drugs (such as folic acid, vitamin D, omega3,
zinc, and multivitamins) that had an average cost of 13 090 285
rials (312 USD) per patient. Each patient had averagely paid
27469 195 rials (654 USD) per year for the diagnostic imaging (eg,
magnetic resonance imaging and computed tomography) and
other examinations including the blood tests. Referring to other
health specialists (including internal medicine, orthopedists, car-
diologists, psychologists) was the second dominant direct-medical
cost with a total of 323 469 386 rials (7701 USD) per patient. From
the 22% of patients who admitted to hospitals, 10% were hospi-
talized and 12% were treated without hospitalization. The hospital
admission costs were estimated to be 168 022 400 rials (4000
USD). Finally, the use of health services such occupational therapy,
physical therapy, and nursing was associated with an average
annual cost of 4 105 130 rials (98 USD) per patient (Fig. 1).
The most prominent direct nonmedical costs included the
costs of changes in home structure and use of accessory equip-
ment such as walker and wheelchair (1 254 000 rials = 30 USD),
costs of transportations and travels (5 580 000 rials = 133 USD),
and other costs such as nutritious food and exercise (30 528 000
rials = 727 USD).
JULY 2022
Indirect costs in the current study were calculated as costs
because of loss of productivity using 2 main approaches, human-
capital and friction-cost. A total of 86 patients had 846 days lost
from work because of their disease. Considering the mean daily
wage for an individual at the time of this study in Iran (933 880
rials = 22 USD), the overall cost of absenteeism (temporary un-
employment) per year was 790 062 480 rials (18 811 USD) using
the human-capital approach. In friction-cost approach, because
each patient had ,14 days absenteeism from work and it could be
made up by sick workers upon return to work or internal labor
reserves, the cost of absenteeism has not been considered. A total
of 22 patients were also unemployed permanently from their
work because of the MS. Overall cost of the permanent unem-
ployment was 2 958 531840 rials (70 441 USD) and 1849 082 400
rials (44 026 USD) with the use of human-capital and friction-cost
methods, respectively. Consequently, the costs because of loss of
productivity of MS were estimated to be 12 495 314 rials (297
USD) per patient with the use of human-capital and 6 163 608 rials
(146 USD) using the friction-cost approach (Fig. 2).
Discussion
This study aimed to explore the social costs of MS in Isfahan,
one of the areas with the most prevalence of the condition in Iran,
with the use and comparison of 2 different approaches, to esti-
mate indirect costs.
The total annual cost of MS was estimated to be 1 441163 710
rials (34 313 USD) and 1 434 832 004 rials (34 162 USD) using the
human-capital and friction-cost approaches, respectively. With
the human-capital approach, 99% of the total costs were related to
the direct costs and 1% was related to indirect costs. These mea-
sures were 99.5% and 0.5% when the friction-cost approach was
applied. Moreover, 97.38% of the direct costs were associated with
the direct-medical costs and 2.61% were related to direct

Figure 2. Components of the indirect costs (USD).
USD indicates US dollar.
nonmedical costs. The superiority of direct costs in the current
study was in line with other evidences.23 Indirect costs consisted
only a small part of the total costs of MS disease. This was prob-
ably because of the characteristics of the participants such as age,
gender, and working conditions and the type of the study, which
was prevalence based, which means the effect of unemployment
was considered for only 1 year, rather than life expectancy;
moreover, no death was reported in this study.23 Among the 300
patients with MS who participated in this study, 192 patients were
without any definite job or were student and cautiously; no loss of
production was considered for them. In fact, only 108 patients
were employed and had any kind of changing in their working
condition and income because of MS. This could be expected
because the majority of the study population includes youth who
are usually studying full time in schools or universities, and the
vast majority of the sampled population were women (76%)
whose employment rate is lower compared with men. This might
explain the difference between the current study and some others
that have reported larger percentage of indirect costs.23
One of the most important goals of this study was to compare
the results of 2 different costing methods of the human-capital
and friction-cost for estimating indirect costs. The results repre-
sented that the indirect costs of MS with human-capital method
were approximately twice as much as the friction-cost approach.
Given that the human-capital approach estimates costs from
employee perspective and uses all of the lost working hours or
permanent unemployment, the indirect costs with this approach
are usually higher than the friction-cost method in which the
employer perspective and a specified friction period (90 days in
this study) are taken into account.29,30
Many studies indicated that the human-capital approach
typically estimates higher amounts of indirect costs than the
friction-cost method for the diseases such as MS in which there
are significant permanent losses of productivity and even pre-
mature death because of the illness.29–31
In comparison with other cost of illness studies conducted on
patients with MS in Iran,32 the total annual cost of this study was
reported to be greater. This difference might be explained by the
availability of new and more expensive drugs compared with
previous studies and the increase in medications, diagnostics, and
hospitalization costs. Nevertheless, the proportion of the costs
(direct costs to indirect costs; direct-medical costs to direct
ECONOMIC EVALUATION 29
nonmedical costs) showed similarity with that the previous
studies, given that the direct costs were greater than indirect costs
and the DMTs costs, prescriptions, and hospitalizations were main
drivers of direct costs of MS.32 The last reported and the most
similar native study regarding the direct and indirect costs of MS
has been performed in Khuzestan, Iran, in 2014, in which direct
and indirect costs were 93.1% and 6.9% of total costs, respectively,
and the major cost of the disease was related to the pharmaceu-
tical treatment.23
The total annual cost of MS in the current study was in the
range with the previous reports of total costs by across the world
(13 721-82 080 USD).23 Nevertheless, despite the similarities be-
tween the results, the comparison of the studies should be con-
ducted with caution because of the methodological differences
among them.23
There are some limitations in our study. First of all, Expanded
Disability Status Scale, which is the main indicator of MS disease
progression, was not evaluated and used in the 2 reported MS
centers; accordingly, it was just possible for the authors to report
the type of MS disease (RRMS or secondary progressive MS).
Second, loss of production of unemployed patients or caregivers
cautiously was not taken into account.
Finally, the population of this study were sampled from 2
referral centers in Isfahan province. Although the treatment and
medications might not differ significantly in different parts of Iran,
this needs to be considered if the results are generalized to the
other parts of the country.
Conclusions
This study was conducted to present a detailed report of the
MS disease costs from a societal perspective in Isfahan, Iran. The
direct costs of the MS are considerably higher than the indirect
costs and the DMT cost was the most prominent direct cost. It is
important for health system organizations to consider the cost
components of the MS disease in their future policies.
Supplemental Material
Supplementary data associated with this article can be found
in the online version at https://doi.org/10.1016/j.vhri.2021.10.006
30 VALUE IN HEALTH REGIONAL ISSUES
Article and Author Information
Accepted for Publication: October 28, 2021
Published Online: January 15, 2022
doi: https://doi.org/10.1016/j.vhri.2021.10.006
Author Affiliations: Health Management and Economics Research Center,
Isfahan University of Medical Sciences, Isfahan, Iran (Amirsadri, Rahimi);
Department of Clinical Pharmacy and Pharmacy Practice, Isfahan Univer-
sity of Medical Sciences, Isfahan, Iran (Amirsadri, Khajepour).
Correspondence: Mohammadreza Amirsadri, PharmD, PhD, Health
Management and Economics Research Center, Isfahan University of
Medical Sciences, Isfahan, Iran; Department of Clinical Pharmacy and
Pharmacy Practice, Faculty of Pharmacy and Pharmaceutical Sciences,
Isfahan University of Medical Sciences, Isfahan, Iran. Email: amirsadri@
pharm.mui.ac.ir
Author Contributions: Concept and design: Amirsadri, Rahimi
Acquisition of data: Amirsadri, Rahimi, Khajepour
Analysis and interpretation of data: Amirsadri, Rahimi, Khajepour
Drafting of the manuscript: Amirsadri, Rahimi, Khajepour
Critical revision of the paper for important intellectual content: Amirsadri
Statistical analysis: Amirsadri, Rahimi, Khajepour
Provision of study materials or patients: Rahimi
Obtaining funding: Amirsadri
Administrative, technical, or logistic support: Amirsadri
Supervision: Amirsadri
Conflict of Interest Disclosures: The authors reported no conflicts of
interest.
Funding/Support: This study was supported by the Faculty of Pharmacy
and Pharmaceutical Sciences, Isfahan University of Medical Sciences, Isfa-
han, Iran with the research grant No. 398730.
Role of Funder/Sponsor: The funder had no role in the design and
conduct of the study; collection, management, analysis, and interpretation
of the data; preparation, review, or approval of the manuscript; and de-
cision to submit the manuscript for publication.
Acknowledgment: The authors thank Drs Ashtari and Etemadifar, the
specialists of the MS center of Ayatollah Kashani hospital and Isfahan MS
center for their cooperation and support.
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