Lacosamide as a first-line treatment option in focal epilepsy: a cost-utility analysis for the Greek healthcare system

Background and aims: Epilepsy is the most common serious neurological disorder worldwide. Approximately 40% of patients with focal epileptic seizures remain uncontrolled with antiepileptic drug (AED) monotherapy or polytherapy. Lacosamide has been recently approved by the European Medicines Agency as monotherapy for the treatment of focal seizures. The aim of this study was to estimate the cost-effectiveness of lacosamide compared with zonisamide as first-line treatment of focal epilepsy in patients with epilepsy aged ≥ 16?years to inform clinical decision-making in Greece.

Methods: A discrete event simulation model was adapted to reflect treatment pathways and resource use within the Greek national healthcare system, as specified by clinical experts. The model captures time-varying events and patient characteristics. Clinical inputs were sourced from pivotal trials and a network meta-analysis comparing lacosamide with other AEDs. The model predicts disease progression and seizures, relevant and most common adverse events, withdrawal due to lack of efficacy or adverse events, and epilepsy-specific and all-cause mortality over a 2-year time horizon. Unit costs were retrieved from published Greek sources. Health outcomes were measured as quality-adjusted life years (QALYs); secondary outcome was the cost per seizure avoided. Robustness of the results was tested with univariate and probabilistic sensitivity analyses.

Results: The lacosamide treatment pathway was associated with higher costs (i.e. €1,064) and an additional 0.119 QALYs when compared with zonisamide, resulting in an incremental cost-effectiveness ratio of €8,938 per QALY gained. The sensitivity analyses demonstrated that the results are most sensitive to the efficacy and utility estimates.

Limitations: There are a number of limitations which stem from the process of model adaptation and lack of local real-world evidence.

Conclusions: Lacosamide is a cost-effective option at a willingness-to-pay threshold of €30,000 per QALY, representing a valuable monotherapy treatment option for patients with focal epileptic seizures in the Greek setting.     

Real-Time Fiscal Forecasting Using Mixed-Frequency Data*

The sovereign debt crisis has increased the importance of monitoring budgetary execution. We employ real-time data using a mixed data sampling (MiDaS) methodology to demonstrate how budgetary slippages can be detected early on. We show that in spite of using real-time data, the year-end forecast errors diminish significantly when incorporating intra-annual information. Our results show the benefits of forecasting aggregates via subcomponents, in this case total government revenue and expenditure. Our methodology could significantly improve fiscal surveillance and could therefore be an important part of the European Commission's model toolkit.     

Shedding light on a dark matter: Jump diffusion and option-implied investor preferences

We compare equilibrium jump diffusion option prices with endogenously determined stochastic dominance (SD) option bounds. We use model parameters from earlier studies and find that most equilibrium model prices consistent with SD bounds yield economically meaningless results. Further, the implied distributions of the SD bounds exhibit a tail risk comparable to that of the underlying return data, thus shedding light on the dark matter of the inconsistency of physical and risk-neutral tail probabilities. Since the SD bound assumptions are weaker, we conclude that these bounds should either replace or be used to verify the equilibrium model results.     

Cash holdings of listed and unlisted firms: new evidence from the euro area

This paper examines the cash holdings behavior of listed and unlisted firms. We argue that unlisted firms, which are smaller, face a greater wedge between the cost of external and internal finance and as a result they need to rely more on the later. Relying on internal funds means that firms have a precautionary motive to hold cash. We test our theory using an unbalanced panel of mainly small medium enterprises within the euro area over the period 2003–2017 paying special attention to the role of financial pressure, financial constraints and the recent financial crisis. Our findings reveal that unlisted firms hold more cash than their listed counterparts due to precautionary motives. In addition, when considering the effect of financial pressure, the results show that the difference in cash holdings between listed and unlisted firms exhibit a ‘U-shaped’ relationship. Finally, unlisted firms have a higher sensitivity to save cash out of cash flow than listed firms. Our results are robust to using different specifications and different financial pressure measures.     

Minimum Quality Standards, Entry, and the Timing of the Quality Decision

This paper examines the effects of the imposition of minimum quality standards (MQS) on a vertically differentiated natural duopoly with free entry. It is shown that the welfare effects of MQS are crucially dependent upon the timing of the quality choice with respect to the decision to enter the market. If irreversible decision to enter is taken without pre-commitment to a specific quality level then a welfare improving MQS always exists. If, however, a firm's product quality must be decided prior to entry then a MQS is either redundant or counterproductive, since it can induce a monopoly.     

Option pricing and replication with transaction costs and dividends

This paper derives optimal perfect hedging portfolios in the presence of transaction costs within the binomial model of stock returns, for a market maker that establishes bid and ask prices for American call options on stocks paying dividends prior to expiration. It is shown that, while the option holder's optimal exercise policy at the ex-dividend date varies according to the stock price, there are intervals of values for such a price where the optimal policy would depend on the holder's preferences. Nonetheless, the perfect hedging assumption still allows the derivation of optimal hedging portfolios for both long and short positions of a market maker on the option.     

Option Bounds and the Pricing of the Volatility Smile

This paper presents a new approach forthe estimation of the risk-neutral probability distribution impliedby observed option prices in the presence of a non-horizontalvolatility smile. This approach is based on theoretical considerationsderived from option pricing in incomplete markets. Instead ofa single distribution, a pair of risk-neutral distributions areestimated, that bracket the option prices defined by the volatilitybid/ask midpoint. These distributions define upper and lowerbounds on option prices that are consistent with the observableoption parameters and are the tightest ones possible, in thesense of minimizing the distance between the option upper andlower bounds. The application of the new approach to a sampleof observations on the S&P 500 option market showsthat the bounds produces are quite tight, and also that theirderivation is robust to the presence of violations of arbitragerelations in option quotes, which cause many other methods tofail.