Overview of decision analysis and cost-effectiveness

This chapter provides an overview of decision analysis and cost-effectiveness. Here we want to understand value by defining it. Many academicians have often expressed value as a function of cost and quality but measuring vaccine value and expressing it quantitatively is not so straightforward. By focusing on cohort-level analyses of value, we can more accurately determine the impact that a certain vaccine will have for a specific population that is at-risk for infectious disease. Thus, decisionmakers can make local, replicable decisions about investment in vaccines that protect different populations on the basis of regional variation, age, sex, race or ethnicity. The chapter will introduce basic concepts such as the difference between cost-effectiveness and cost-benefit analysis, as well as how to derive measures of budget impact and return on investment from a single economic model. This chapter includes an exercise that evaluates the reader’s comprehension of the definitions to different approaches in economic evaluation.