The efficacy of scarce drugs for many infectious diseases is threatened by the emergence and spread of resistance. Multiple studies show that available drugs should be used in a socially optimal way to contain drug resistance. This paper studies the tradeoff between risk of drug resistance and operational costs when using multiple drugs for a specific disease. Using a model for disease transmission and resistance spread, we show that treatment with multiple drugs, on a population level, results in better resistance-related health outcomes, but more interestingly, the marginal benefit decreases as the number of drugs used increases. We compare this benefit with the corresponding change in procurement and safety stock holding costs that result from higher drug variety in the supply chain. Using a large-scale simulation based on malaria transmission dynamics, we show that disease prevalence seems to be a less important factor when deciding the optimal width of drug assortment, compared to the duration of one episode of the disease and the price of the drug(s) used. Our analysis shows that under a wide variety of scenarios for disease prevalence and drug cost, it is optimal to simultaneously deploy multiple drugs in the population. If the drug price is high, large volume purchasing discounts are available, and disease prevalence is high, it may be optimal to use only one drug. Our model lends insights to policy makers into the socially optimal size of drug assortment for a given context.
All Science Journal Classification (ASJC) codes
- Geography, Planning and Development
- Economics and Econometrics
- Strategy and Management
- Statistics, Probability and Uncertainty
- Management Science and Operations Research