Reductions in obesity-related medical costs offset cost of gastric banding surgery within 2.25 years

Allergan, Inc. (NYSE: AGN) today announced a new study published in the peer-reviewed journal Surgery for Obesity and Related Diseases that found the cost of a gastric banding weight-loss surgery procedure, such as Allergan's LAP-BAND® Adjustable Gastric Banding System, was offset by reductions in obesity-related medical costs within 2.25 years for surgery eligible patients with diabetes, and within four years of the procedure for all surgery eligible patients.

The study evaluated healthcare claims data from 7,310 patients who had undergone gastric banding compared to claims from a matched control group of 7,306 surgery eligible obese individuals who did not have weight-loss surgery, for the purpose of quantifying the potential savings of gastric banding. The study found that while post-surgery medical costs for the gastric banding group declined slightly, medical costs for the control group continued to rise, thus resulting in significant savings for the banding sample. These findings underscore the critical effect gastric banding has on containing healthcare costs among the target population.  

"Although the gastric banding procedure is associated with upfront costs, our analysis shows that those costs are recovered in a relatively short period of time, particularly for obese patients with diabetes," said study lead author Eric A. Finkelstein, Ph.D., of Duke University and Duke-NUS Graduate Medical School in Singapore. "Although the potential for cost-savings should not drive coverage decisions, some insurance providers are hesitant to cover the costs of bariatric procedures for fear they will break the bank. These results may allay some of those concerns," Finkelstein said.  

Currently, one in three American adults is obese. Due to increased medical expenditures, absenteeism, and presenteeism (reduced on the job productivity due to health reasons), obesity now costs U.S. businesses roughly $70 billion per year. The total medical bill for the nation as a result of obesity is now projected at $147 billion per year, or nearly 10 percent of all medical expenses in the United States. This figure is projected to reach 16-18 percent of all U.S. healthcare costs in the next 20 years. Given its known correlation to life-threatening co-morbid conditions, such as heart disease, stroke, Type 2 diabetes, high blood pressure, sleep apnea and even premature death, obesity is a disease that requires medical treatment. Furthermore, medical research has found that if left untreated those individuals who are currently obese will likely remain obese, highlighting the unmet clinical need among obese patients for the availability of and reimbursement for effective treatment options.

"This study is consistent with the vast findings from the published literature that support gastric banding is an effective and safe weight-loss surgery procedure that can produce sustained weight loss, ultimately resulting in reduction of obesity-related comorbid conditions and medical costs," said Frederick Beddingfield, M.D., Allergan's Vice President of Clinical Research and Development. "Research of this kind is integral in our efforts as a company to ensure appropriate access to and affordability for the LAP-BAND® System procedure for patients across the country."