“Making more informed drug choices using comprehensive and actionable adverse drug events data leads to improved patient safety and outcomes and reduced costs.”
According to Institute of Medicine (IoM) study To Err Is Human (IoM, 2007), adverse drug events are the largest single category of adverse events in hospitalized patients that account for 19% of all injuries. According to this study, the number of preventable adverse drug events that occur annually in U.S. hospitals ranges from 380,000 to 450,000 . The estimated incremental cost of an adverse drug event is currently about $5857 . These figures place an estimated cost of preventable adverse drug events in the U.S. at $3.5 billion a year.
The overall number of adverse drug events reported in the FAERS database is steadily increasing. Mandatory reports submitted by manufacturers account for most of this increase, while the number of adverse drug events submitted directly by healthcare professionals remains very low. It is estimated that only 1 to 10% of all adverse drug events that occur is ever submitted to the FDA .
Collection, processing, and submission of adverse drug events inflict a significant financial burden on the industry. In 2013, post-market safety surveillance accounted for 60% of the global pharmacovigilance market. According to Transparency Market Research, the global pharmacovigilance market is expected to grow at a Compound Annual Growth Rate (CAGR) of 13-14% to approximately USD 6 billion by 2020. Main drivers for increased ADR reporting include compliance requirements and liability resulting from high profile product failures .
In a recent report by Grand View Research published in April 2019, the pharmacovigilance market is expected to reach USD 11.64 billion by 2026, as projected from CAGR of 13.3%. Key drivers include increasing incidence of adverse drug events, a larger proportion of drugs consumed in non-hospital setups, higher share of chronic diseases and increasing number of drugs made available to consumers with and without prescription and increasing number of clinical trials.
Main strategies employed to reduce the cost of adverse drug events include outsourcing of case processing to low-cost destinations in Asia . The cost of pharmacovigilance is becoming too high to be a defensible expense in light of the value provided to stakeholders. The processing and reporting of adverse drug events need to undergo significant automatization to bring the costs down and remove the financial incentive to move personally identifiable health information offshore. In addition, the data collected from patients must reflect the needs of all stakeholders interested in the impact adverse drug events have. Pharmacovigilance is an industry that is ripe for disruption that would bring the cost of collection and processing of adverse drug events to sustainable levels.
 Aspden P, Wolcott JA, Bootman JL, Cronenwett LR. Preventing Medication Errors: Quality Chasm Series, The Institute of Medicine, The National Academic Press, Washington, DC 2007.
 Junya Zhu, Saul N Weingart: Prevention of adverse drug events in hospitals. Up To Date, 2018.
 FAERS public dashboard (accessed 23 July 2019)
 Transparency Market Research, 2014: “Pharmacovigilance Market – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2014 – 2020”. Transparency Market Research.
 Grand View Research, 2019. Pharmacovigilance Market Worth $11.64 Billion By 2026. Grand View Research. Retrieved from https://www.grandviewresearch.com/press-release/global-pharmacovigilance-market (accessed 23 July 2019)