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upset man because he's paying too much money for prescription drugs

Positive Side Effect: PGx Testing Can Reduce Prescription Drug Costs

Pharmacogenomics testing, which allows physicians to deliver personalized healthcare based on a patient’s genetic make-up, has some well-known benefits.

The Mayo Clinic says that utilizing this emerging tool can result in “the right drug at the right dose at the right time.”

These advanced molecular-based tests, which ascertain how a person’s genes affect how they respond to commonly prescribed medications can:

  • Determine which medication can be an effective treatment for a patient
  • Determine the proper dosage of a drug for a patient
  • Determine if a patient may suffer a serious side effect from a drug

Pharmacogenomics (sometimes called pharmacogenetics or simply PGx) can also have a positive side effect: reducing prescription drug costs.

“The results help tailor your medication based on your genes now and for future prescription needs,” says the Mayo Clinic.

The Cost of Trial and Error Medicine

PGx can alleviate the costs of prescribing ineffective, and sometimes dangerous, medication for a patient which can lead to financial and physical tolls.

“PGx can determine how each individual metabolizes 95 percent of the most commonly prescribed oral medication, avoiding costly trial and error prescribing and minimizing the risk of costly and life-threatening adverse drug reactions (ADR),” says Corporate Wellness Magazine.

In 2019, the U.S. spent $1,126 per person on prescribed medicines compared to an average of $552 for other countries, according to HealthSystemTracker.org.

This cost, which includes spending from insurers and out-of-pocket costs from patients for prescription drugs filled at pharmacies, has grown by 69 percent in the U.S. since 2004.

Not only does trial and error medicine lead to higher prescription drug costs as patients receive ineffective medication, but there can be deadly consequences.

The FDA says that ADRs are “one of the leading causes of morbidity and mortality in health care.”

Preventing these side effects to medication, which can be serious or even fatal to older patients, is a priority not only for hospitals but also for nursing homes and long-term care facilities.

Medicare Covers Some PGx Testing

The Medicare national coverage policy guidance says there is limited coverage for pharmacogenomics testing including single gene, multi-gene panels, and combinatorial tests.

“These tests are generally covered (with a few exceptions) as described in further detail below to improve safety in the use of specific medications by avoiding potentially harmful medications, doses and/or adverse reactions known to occur with certain genotypes,” says CMS.gov.

PGx testing, according to the Medicare coverage database, is considered reasonable and necessary in limited circumstances as an adjunctive personalized medical decision-making tool once a treating clinician has narrowed treatment possibilities to specific medications under consideration for use, or is already using a specified medication based on other clinical considerations including:

  • The patient’s diagnosis
  • The patient’s other medical conditions
  • Other medications
  • Professional judgment
  • Clinical science basic science pertinent to the drug
  • Patient’s preferences and values

Medicare provides such coverage for PGx because it understands that such testing can lead to decreased costs by preventing unnecessary prescriptions while improving patient outcomes by identifying effective medications and doses for individual patients.

The Center for Medicare Advocacy says, “Medicare typically covers genetic tests only when a beneficiary has signs or symptoms that can be further clarified by diagnostic testing. Medicare also covers some genetic tests that assess an individual’s ability to metabolize certain drugs.”

Cost-Effectiveness of PGx Testing

A 2021 research paper published in BMC Health Services Research analyzed the cost-effectiveness of PGx testing by looking at medical studies through Medline via PubMed, Scopus, and CRD’s NHS Economic Evaluation.

After searching 6,718 studies, the paper’s author extracted data from 59 studies with the following findings:

Cardiovascular Diseases

  • 9 studies showed that CYPsC9 and VKORC1 testing to prevent the risk of bleeding would be a cost-effective intervention
  • 9 studies showed that CYP2C19 testing would be potentially cost-effective treatment for avoiding major adverse cardiovascular events
  • A study demonstrated that genotyping would be a cost-effective intervention to identify statin-induced myopathy in cardiovascular patients


  • 3 studies showed that HLA-B*58:01 genotyping would be a cost-effective and/or cost-saving intervention to prevent allopurinol-induced Stevens-Johnson syndrome (SJS/TEN) and DRESS (Drug Rash with Eosinophilia and Systemic Symptoms) syndrome

HIV Infection

  • 4 studies demonstrated that HLA-B*57:01 testing would be cost-effective and cost-savings to prevent abacavir-induced hypersensitivity reaction
  • A study found that CYP2B6 genotyping before prescribing efavirenz to prevent central nervous systems (CNS) toxicity in HIV patients was cost-saving as compared to not testing due to lower lifetime cost and a gain in QALY (quality adjusted life years)

Autoimmune Diseases

  • 5 studies showed that testing would be cost-effective and cost-saving intervention to prevent severe ADRs regarding azathioprine such as severe bone marrow toxicity associated with Thiopurine S-methyltransferase (TPMT) deficiency in patients with autoimmune diseases, inflammatory bowel disease, idiopathic pulmonary fibrosis, Crohn’s disease, rheumatoid arthritis, or systemic lupus erythematosus

Epilepsy/Neuropathic Pain

  • 3 studies showed that HLA-B*15:02 genotyping to prevent risk of SJS/TEN in patients prescribed carbamazepine (CBZ) would be cost-effective
  • A study showed that HLA-A*31:01 genotyping would be cost-effective to prevent severe ADRs associated with CBZ


  • A study showed that UGT1A1 screening before prescribing irinotecan to prevent severe neutropenia in metastatic colorectal cancer would be a cost-effective intervention
  • A study showed that DPYD testing before prescription of fluoropyrimidines would be cost saving, as compared to no testing, in preventing severe hematologic and GI toxicity

The research paper concluded that “cost-effectiveness results were mostly sensitive to the probability of drug induced-ADRs, the effectiveness of pharmacogenetic testing to prevent ADRs, the cost of testing, and the cost of alternative drugs in patients who tested positive.”

Wise Diagnostic Systems is developing pharmacogenomics tests based on advanced molecular assay technologies, which is expected to further support physicians in offering better informed clinical decisions.