• 1)

  Cost-of-illness

This approach was the first theoretical framework adopted for the estimation of substance abuse social cost.13 According to it, the estimation of the social cost of illegal drugs is calculated as the sum of the discounted value of resources used to diagnose and treat the illness and productivity losses due to related mortality and morbidity (productivity, use of resources, property destruction and losses, etc.).14 Cost-of-illness (COI) can be prevalence based, aiming at estimates the economic burden of a condition over a specific period, usually a year, or incidence based. In this last case, COI focus on the new cases of a conditions emerged during a specific year. For these, it estimates the lifetime costs from the illness onset until its disappearance. Incidence-based COI studies are designed to assess all future costs that are amenable to preventive policies. Prevalence-based studies, instead, picture the burden of a disease in a given time and represents a tool for defining the social and healthcare measures for tackling current substance abuse consequences and their related impact on public finance.6

One of the COI's main controversies is the definition of the counterfactual, i.e., the alternative scenario that should be used for opportunity cost assessment.15 The cases of a world with no drug or a switch towards either a lower level of consumption or other substances are equally plausible in theory.5 The use of “zero consumption” as a counterfactual is the most common choice. Another point of debate regarding COI is that uncertainty is not adequately accounted for,16 so different counterfactual scenarios have been defined for three types of illegal drug users: recreational users, older regular users, and problematic users.17 Additionally, sensitivity analysis has been adopted as a method for taking into account uncertainty.

• 2)

  Averting behaviour method

Averting behaviour method aims at calculating expenditures individuals would make to protect them from and mitigate negative effects of risks.14 It assumes that a rational individual will use defensive behaviour as long as the value of the damage avoided exceeds the costs of the protective action.18 No examples are available in the literature, mainly because there is not a reliable calculation of averting behaviour cost.14

• 3)

  Utility theory

Approaches based on utility theory aim at associating economic values with individuals’ preferences. In health economics studies, these approaches are used to estimate the value that individuals put on changes in mortality and morbidity probability,19 and they represent the base of the quality adjusted life years (QALY) measurement. Though utility theory is widely used, it has been criticized because it relies on probabilities of adverse health rather than real consequences generated by cases of adverse health effects.14

One of the most widespread categorisations of the social cost of drugs is represented by the dichotomy between tangible and intangible cost.20 When reduced, tangible costs yield new available resources; Intangible costs don’t. Intangible costs include items such as pain and suffering. Due to their nature, they are difficult to quantify and they are rarely included in the estimation. Within tangible cost, one can distinguish between direct and indirect costs.4 The first category includes costs which are clearly and directly associated with illegal drug consumption, as healthcare costs for treating addiction; the second is related to consequences that are not directly connected with consumption, as productivity losses (Table 2).

Another criterion for social cost categorisation identifies three main categories.4,5 Private costs, as the costs borne only by an individual, in this case the illegal substance user (e.g., money spent for buying substances); public costs, i.e. expenditures incurred by central and local government in relation to psychotropic substances use, as is the case of healthcare and treatment costs in universalistic national health services; and external costs or externalities, referring to those public costs that are generated by the individual making the consumption decision but external to the same individual.

While the pertinence of the last two categories is acknowledged, inclusion of private cost has been highly debated. Its exclusion has been justified by the assumption of the rationality of drug users, and criticized given that drug users’ behaviour may be determined by the irrationality produced by addictions, thus violating the rationality postulate.5 Moreover, private decisions within the drug consumption and addiction context do have consequences and generate costs that are not limited to consumers themselves.5 This would justify the inclusion of part of the private cost in social cost, but it remains unclear which part of it and how it should be calculated.

The cost related to substance use can be divided in two groups. Unavoidable costs, generated from already existing drug-related diseases and new cases due to prior consumption, plus cases due to continued, irreducible consumption; And avoidable costs, those that are amenable to interventions and behaviour changes. This last category is the one that really provides information regarding the benefits that interventions which reduce drug use can generate.21

A method for identifying avoidable cost is attributable fraction.22 Together with attributable fractions, the estimation of the potential impact of policies around illegal drugs must take into account the lowest achievable level of substance use that policies should be expected to realistically aim for, which the literature terms the feasible minimum.19 Given its objective, feasible minimum can be of help in the execution of cost-benefit analysis, as it provides a method for better defining the cost and consequences that an addiction policy aims to contrast.

Authors identify four alternative methods for calculating it:

• 1)

  Epidemiological method

This method has two alternative approaches23:

• •

  The classical approach, which derives feasible minimum from each population's exposure to an illness-specific risk factor. This approach is retrospective, as it is based on population exposure in the past, and uses the hypothesis of no exposure. as the counterfactual.

• •

  The distributional approach is a prospective analysis which entails the assessment of changes in the risk factor exposure distribution. To select realistic distribution changes, scholars have considered the experience of comparable countries or followed historical trends.23

• 2)

  The Arcadian normal

It is based on the assumption that, for each population, “a level of disease that might be reasonably achieved if only we all know that which might be reasonably known about the causes of the disease in question” can be identified.24 Groups of countries with genetically similar populations and comparable living standards share the same Arcadian normal, defined as the within-group lowest age-standardised mortality rate for each cause of death. From this, potentially avoidable mortality and feasible minimum can be estimated.

The main shortcomings of this approach are21: it does not take into account each country's exposure-specific profile, it is not disease-specific, and it groups countries according to a non-comprehensive approach (only genetic profile and living standards), not considering differences regarding other relevant factors.

• 3)

  Exposure-based comparators

For countries that do not have a long tradition of healthcare data collection, an alternative is the use of prevalence data as a proxy for attributable fraction.21 This method relies on World Health Organisation (WHO) estimations of relative risks, which are performed grouping countries by sub-region.25

• 4)

  Using evidence on interventions’ effectiveness

Avoidable cost estimation can be supported by evidence generated by the literature on drug use interventions and policies, although with limitations.25

For future research on this topic, it would be of interest that new approaches were developed as a combination of the four above mentioned methods, for example using specific relative risk of the WHO sub-regions together with a gross domestic product (GDP)-based country selection.

• 1)

  Incidence vs. prevalence perspective

The literature indicated a large consensus towards the prevalence based approach.4,26,27 As for the human capital and demographic approach dichotomy, the two methods should be considered as complementary rather than alternative.4,5

• 2)

  Intangible costs

The most debated aspect related to the inclusion of intangible costs is their conversion to monetary value. Two methodologies has been proposed for their estimation5: the human capital approach, described in the previous section, and willingness to pay, which involves calculating intangible costs by identifying the amount of money that would be spent by an individual on reducing the risk of death associated with an illness, using this as an instrument for calculating the value of life.28

Studies that tried to estimate intangible costs have been published only recently.6,17,19 Others have preferred to not include intangible costs in their estimation.7,23 A less demanding and more flexible and much more widespread approach is to convert the various health impacts into a common health unit, and then apply a fixed monetary value to each unit. QALY have been proposed as such a measure7, but it does not exist such a general agreement on the appropriate monetary value of QALY (WHO 2009). More details on both the revealed valuation and the stated preference approaches, as well as on the value of QALY can be found on cost-benefit and cost-utility analysis literature.

• 3)

  Productivity losses

They represent all those losses of production or productivity at work connected to the consumption of illegal drugs, due to premature death, disability, absenteeism or others.5 Two main methods have emerged in the review. The first one is the human capital approach, described in the previous section. While using this method, authors have adopted the case of full employment, thus no loss of productivity due to drug consumption, as counterfactual.29,30 An alternative is represented by the friction cost method, which is based on the time and related cost that is connected with the replacement of the workers whose absent due to illness by another coming from the pool of unemployed.22 While friction allows for a more exact calculation of real cost sustained by an employer in substituting a worker, it's application is limited, as it requires data on disease-specific employment rate and job vacancy duration.22

The literature on the social costs of illegal drugs contains a wide variety of proposals regarding the categories and sub-categories that should be included in the matrix of costs. The most common types of costs included are5: healthcare and welfare costs, productivity costs, criminal justice costs, and other costs.

Healthcare costs can be divided into three main subcategories: cost for substance use treatment; cost for co-morbidity treatment; prevention, education and research programmes.29,30 For productivity losses, three sub-categories of cost can be identified: premature mortality, which can be generally retrieved from national databases; morbidity-lost work time or lower productivity, connected to events like days of work or work time lost due to harms, disabilities or negative impact on workers productivity generated by consumption of illegal drugs; and non-workforce productivity losses, related to production lost from unemployed people, retired people or individuals outside the workforce, who can still produce output through unpaid work. The approach is to assign a value to those activities from equivalent services purchased from outside sources.29,30

Criminal justice costs due to drug use refer to a broad and complex domain, although two sub-categories can be identified5: those that are directly related to the activities aimed at combating and preventing criminal activities connected to illegal drug use; And drug crime victims’ losses, which are mainly connected to the time lost, and related loss in work productivity, experienced by those who are victims of drug-related crime.

Other costs include the costs which are not strictly related to those previously described, such as property losses due to crime caused by substance use.