The evaluation of the financial effect of NSPs on HIV and HCV has been based on:

  • The reported operating and overhead costs of NSPs across Australia during the 1990s;

  • Estimates of the number of cases of HIV and HCV avoided as a result of NSPs;

  • Past and current treatment regimes and associated costs of treating HIV and HCV;

  • Projections of future treatment costs based on the above; and

  • The application of a Net Present Value (NPV) model to determine the return on investment to both government and in total for NSPs.
The analysis indicates that the return on investment will exceed manyfold the original investment in NSPs, and that the original investment had been fully recouped and surpassed by the end of the investment period, before any future savings are taken into account. The investment in NSPs is justified by the effect on HIV alone, with the effect on HCV providing an additional financial benefit, albeit a smaller one than HIV. Sensitivity analysis on the main variables used in the analysis indicates that the results are robust under a range of alternative assumptions and scenarios.

A number of observations are offered about the results presented.
  • The factor that has the greatest impact in the financial analysis is the effect of NSPs in reducing the incidence of HIV (and to a lesser extent HCV). The evidence base for the estimation of effect has increased significantly since the earlier study by Hurley and Kaldor, with a greater number of sites now reporting data on HIV seroprevalence, which has been used in the analysis of effect presented in Section 3. As noted in Section 3.1.7, however, NSPs typically operate in an environment where a range of public health and other initiatives are in place. It is not possible to isolate the effects of NSPs from other elements in these initiatives. Indeed, it may be that NSPs are simply a "marker" for a range of activities whose combined effect is that demonstrated to date. Notwithstanding this point, the sensitivity analysis conducted indicates that even under scenarios where the effect of NSPs on HIV incidence is reduced by 75% of the original estimate, the return on investment from NSPs remains positive.Top of page

  • The analysis of return on investment has considered only the direct costs and savings associated with NSPs. In particular, only direct health care savings relating to treatment costs of HIV and HCV have been incorporated into the analysis. There is clearly a greater range of other potential financial savings to be derived from a reduction in HIV and HCV, savings that would accrue to governments, patients and their carers as well as wider society. For example, savings to government and the community in terms of employment and unemployment, education and parenting costs are likely to be considerable. The exclusion of these savings from the analysis means that the case presented may understate, potentially significantly, the total financial benefits of NSP programs.

  • Estimates of future treatment costs have been based on current treatment regimes and the costs associated with those regimes. As has been shown with the introduction of antiretroviral therapy for the treatment of HIV, methods and costs of treatment can change very quickly, which may have a significant effect on patients, as well the analysis of return on investment. The sensitivity analysis conducted on the results to date indicates that, even if future treatment costs halve, NSPs would continue to be a sound investment strategy. However, any radical changes to treatment methods and their effect on disease progression and life expectancy may affect the outcomes presented.

  • The analysis presented has considered the retrospective investment in NSPs, as well as the direct health care savings accrued to date and in the future associated with that investment, and assumes that the investment in NSPs ceases in the year 2000. Given the current population of injecting drug users and the level of use of NSP services, together with the demonstrated effect of NSPs on HIV and HCV, it is clear that an ongoing investment in NSPs will continue to avert the incidence of HIV and HCV, and that savings will continue to accrue. Consequently, the model demonstrates not only that the return on investment to date in NSPs has been positive, but also that ongoing investment in NSPs is warranted.
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