the online version of this article ( doi:10.1007/s13300 - 014 - 0080 - 0 ) contains supplementary material , which is available to authorized users . type 2 diabetes mellitus ( t2 dm ) is a serious progressive disorder characterized by insulin resistance and relative insulin deficiency resulting in increased blood glucose level . the prevalence of t2 dm is growing worldwide , mainly due to growth in urbanization and the resulting substantial changes in lifestyle . the total number of adults aged 2079 with diabetes is projected to increase from 382 million in 2013 to 592 million in 2035 . it has been estimated that 6.4% of adults aged 2079 had diabetes in sweden in 2013 . t2 dm is the most common form of diabetes worldwide , and is an established risk factor for several fatal and non - fatal micro- and macrovascular complications . an estimated 8% of the total swedish health expenditure went to diabetes - related healthcare . previous studies have shown that good glycemic control is crucial to decrease the risk of diabetes - related complications [ 36 ] . the american diabetes association recommends glycated hemoglobin ( hba1c )  <  7% as treatment goal for most patients with t2 dm , and the year 2010 guidelines from the national board of health and welfare in sweden advocates similar treatment goals for newly diagnosed , people who were diagnosed at younger age , and people with low risk of cardiovascular diseases . a typical treatment pattern for t2 dm , advocated by international and swedish guidelines , begins with lifestyle modifications , then adds metformin monotherapy when blood glucose control is unsatisfactory , followed by the addition of other medication such as sulfonylurea or basal insulin including intermediate - acting neutral protamine hagedorn ( nph ) insulin . the progressivity of the disease implies that many patients eventually will need multiple dose insulin treatment if second - line treatment does not result in achievement of sufficient control of blood glucose levels [ 810 ] . despite these guidelines and the availability of a range of drugs , a large proportion of t2 dm patients fail to achieve and maintain the treatment goals , mainly due to the progressive nature of the disease and the inadequacy of conventional treatments . a survey conducted in 2008 by the swedish national diabetes register showed that while there was an improvement in the proportion of t2 dm patients reaching hba1c    7% compared with 1999 , a substantial proportion of patients ( 48% ) still did not achieve this treatment goal . in addition , conventional medications such as sulfonylurea or insulin are associated with side effects including weight gain and hypoglycemia [ 14 , 15 ] . hence , there is a need for new therapies with better efficacy and fewer side effects . in response to this , incretin - based therapies have attracted growing interests during recent years , as clinical trials indicated that they might provide improved glycemic control with low risk of hypoglycemia and seem weight neutral , or even weight reducing [ 14 , 1618 ] . these therapies are mainly recommended as second - line therapy among patients who fail to achieve or maintain the blood glucose treatment goals on metformin alone . two classes of incretin - based therapies are available : glucagon - like peptide-1 ( glp-1 ) receptor agonists and dipeptidyl peptidase-4 ( dpp-4 ) inhibitors . currently , two glp-1 agonists ( liraglutide and exenatide ) and three dpp-4 inhibitors ( sitagliptin , saxagliptin , and vildagliptin ) have been approved for use in sweden . while the short - term treatment efficacy and safety of incretin - based therapies have been investigated , there is limited evidence on the long - term efficacy and cost - effectiveness of these therapies . increased use of these newer , more expensive drugs in routine practice has substantial budgetary implications for health systems . moreover , while there is consensus on using metformin as the first - line oral anti - hyperglycemic alongside lifestyle modifications in t2 dm patients when lifestyle interventions are insufficient for glycemic control , there is disagreement over the preferred agent for second - line therapy . hence , it is of value to evaluate and compare the cost - effectiveness of these second - line therapies to aid well - informed decisions regarding second - line therapy for patients with t2 dm inadequately controlled by metformin monotherapy . the aim of this study was to estimate the lifetime costs and benefits of three second - line treatment alternatives : adding glp-1 agonists , dpp-4 inhibitors , or nph insulin to metformin among t2 dm patients failing to reach hba1c    7% with metformin alone in sweden . in addition , considering the treatment strategies included in this study , we implicitly evaluated the cost - effectiveness of starting nph insulin as the second - line therapy or later as third - line therapy after applying incretin - based agents . the authors conducted this cost  utility analysis using the swedish institute for health economics cohort model for t2 dm ( ihecm - t2 dm ) . this model was previously described and used to compare cost - effectiveness of liraglutide versus sulphonylurea or sitagliptin in sweden . the ihecm - t2 dm is a cohort model consisting of two parallel markov chains covering 120 microvascular health states and 100 macrovascular health states . the microvascular health states include three subgroups : retinopathy , neuropathy , and nephropathy based on the work of eastman et al . , brown et al . , and bagust et al . the macrovascular health states include four subgroups : ischemic heart disease , myocardial infarction , stroke and , heart failure based on united kingdom prospective diabetes study ( ukpds ) outcomes models [ 24 , 25 ] and the swedish national diabetes register ( ndr ) equations . for macrovascular complications , in the current study , the authors used equations from the ndr   in the base case and from the ukpds outcome model-1   in a sensitivity analysis . with this structure , patients can develop multiple complications within each model cycle and over the simulation period . the ihecm - t2 dm has a yearly cycle and a time horizons of up to 40  years can be used . in addition , the user can choose between two sets of mortality risk equations [ 24 , 25 ] . the model also includes evolution of biomarkers over time , treatment algorithms , and treatment - related side effects such as hypoglycemia . eight biomarkers are included in the model and evolution of these biomarkers over time is determined by the initial treatment effects and an annual drift . treatment algorithms include up to eight changes in anti - hyperglycemic treatment composition to account for possible combinations of glucose - lowering agents and treatment intensifications ; this algorithm depends on a user - defined switching threshold of hba1c . the model starts with assigning baseline clinical and demographic characteristics of the cohort , history of complications before diagnosis , and prevalence of diabetes - related complications . this article does not contain any new studies with human or animal subjects performed by any of the authors . the baseline characteristics of the simulated cohort were based on a survey conducted by the swedish national diabetes register . as in this study , the authors evaluated the three second - line therapies as add - on to metformin , they used the data on a sample of patients on metformin monotherapy with hba1c  >  7% consisting 30% of patients on metformin monotherapy in ekstrom et al.s study   ( table  1 , data were provided by the swedish national diabetes register).table  1baseline characteristics of patients on metformin monotherapy with hba1c  >  7% in the swedish national diabetes register ( ndr)variable 
 n 
 value ( sd)age ( years)12,17264.7    11.6diabetes duration ( years)10,9885.6    4.6male ( % ) 7,00057.5smoker ( % ) 1,71017.5hba1c ( % ) 12,1727.7    0.8systolic bp ( mmhg)11,649137    16diastolic bp ( mmhg)11,64979    9total cholesterol ( mmol / l)9,3814.9    1.1hdl ( mmol / l)8,3221.2    0.3ldl ( mmol / l)7,3552.8    0.9triglycerides ( mmol / l)8,2002.1    1.3bmi10,38530.9    5.3 
 bmi body mass index , bp blood pressure , hba1c glycated hemoglobin , hdl high - density lipoprotein , ldl low - density lipoprotein , sd standard deviation baseline characteristics of patients on metformin monotherapy with hba1c  > 7% in the swedish national diabetes register ( ndr ) 
 bmi body mass index , bp blood pressure , hba1c glycated hemoglobin , hdl high - density lipoprotein , ldl low - density lipoprotein , sd standard deviation three treatment strategies evaluated in the study are presented in fig .  1 . in strategies 1 and 2 , patients received the glp-1 receptor agonists and the dpp-4 inhibitors as add - on to metformin , respectively . in both these strategies , patients progressed to nph insulin 40 insulin units ( iu)/day  +  metformin when hba1c exceeded 7.5% and to intensified nph insulin 60  iu / day  +  metformin when hba1c  8% ( the base case analysis ) . in sensitivity analyses , these hba1c threshold values changed to 8% ( switch to nph insulin 40  iu / day ) and 8.5/9% ( switch to nph insulin 60  iu / day ) . in strategy 3 , patients received nph insulin 40  iu / day  +  metformin as initial second - line treatment , then progressed to nph insulin 60  iu / day  +  metformin on reaching the hba1c threshold value of 8% ( the base case analysis ) and 8.5/9% ( the sensitivity analyses ) . comparing strategy 3 with strategies 1 and 2 would provide more insight about timing of insulin initiation in t2 dm patients . in the current study , the glp-1 receptor agonists included liraglutide 1.2  mg daily and exenatide 2  mg once weekly , and the dpp-4 inhibitors are sitagliptin 100  mg daily , saxagliptin 5  mg daily , and vildagliptin 100  mg daily.fig . dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units schematic of treatment strategies applied in the base case analysis . dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units treatment effects were considered as absolute change from baseline in hba1c and weight and the rates of mild , moderate , and major hypoglycemia ( table  2 ) [ 2834 ] . the treatment effects for each drug class were extracted from the literature ; where data at drug class level were not available , the authors used data from head - to - head randomized controlled trials for a single agent in each drug class . the model considers non - severe daytime hypoglycemia as mild and non - severe nocturnal hypoglycemia as moderate hypoglycemia.table  2efficacy of treatments used in the study modelvariableglp-1 +  metdpp-4  +  metnph insulin 40  iu / day  +  metnph insulin 60  iu / day  +  metchange in hba1c ( % ) 0.96 0.69 1.12 0.69change in body weight ( kg)1.80 0.00 3.30 1.80mild hypoglycemia ( per patient per year)0.14 0.14 3.16 3.16 moderate hypoglycemia ( per patient per year)0.05 0.07 1.014 1.014 major hypoglycemia ( per patient per year)0.006 0.01 0.06 0.06 systolic blood pressure ( mmhg)3.20 4.00 2.00 0.00diastolic blood pressure ( mmhg)1.60 1.47 1.00 0.00total cholesterol ( mmol / l)0.01 0.00 0.20 0.00hdl cholesterol ( mmol / l)0.01 0.01 0.00 0.00ldl cholesterol ( mmol / l)0.09 0.09 0.10 0.00triglyceride ( mmol / l)0.10 0.23 0.40 0.00 
 dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , hdl high - density lipoprotein , iu insulin units , ldl low - density lipoprotein , met metformin , nph neutral protamine hagedorn efficacy of treatments used in the study model 
 dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , hdl high - density lipoprotein , iu insulin units , ldl low - density lipoprotein , met metformin , nph neutral protamine hagedorn the authors used data from the literature to estimate the treatment effects due to intensification of insulin from 40  iu / day to 60  iu / day [ 35 , 36 ] . a recent meta - analysis found no direct association between dosage of insulin and risk of hypoglycemia , and so the authors applied the same rate of hypoglycemia events for both insulin treatments in this study . to account for association between hypoglycemic events and changes in hba1c , the reported event rate from a study is transferred to expected event rate using coefficient ( 1.43 ) from a previous study . as in previous studies , no treatment effect on other biomarkers was assumed in the base case analysis [ 3942 ] . when data on treatment effects of nph insulin were not available , the authors used the results from glargine insulin , since previous studies reported no significant difference in treatment effects between nph and glargine insulin [ 4345 ] . treatment effects were applied for the first year after treatment , and then a constant annual drift was assumed for different treatment strategies . the annual drifts in weight were 0.42  kg for insulin and 0.23  kg for other treatments in the base case analysis . in the sensitivity analyses , the authors considered 0.23  kg and 0.1  kg change in weight for all treatments . they assumed 0.3  mmhg and 0.03  mg / dl annual drifts in blood pressure and lipid levels , respectively . prevalence of t2dm - related complications at baseline was extracted from national and international published sources [ 26 , 50 , 51 ] . in the base case , costs were accounted from a societal perspective ( 2013 swedish krona , sek , 1 sek  =  0.115 euros ) and included healthcare costs , productivity losses , and net consumption losses . costs for drugs , self - monitoring blood glucose ( smbg ) test strips , and smbg lancets were collected through the dental and pharmaceutical benefits agency in sweden ( tlv ) . in the base case analysis , the authors calculated a weighted average cost for glp-1 agonists and dpp-4 inhibitors according to consumption of single agents in each class in sweden in 2013 , while in a sensitivity analysis , they applied the price of the lowest cost agent for each drug class ( liraglutide for glp-1 agonists class and vildagliptin for dpp-4 inhibitors class ) . in the base case analysis , based on recommendations by owens et al . , the authors assumed that no smbg is required for patients on dpp-4 inhibitors and glp-1 agonists regimens , and daily monitoring is required for patients on nph insulin regimens . costs associated with t2dm - related complications and treatment side effects were derived from sweden - specific published sources adjusted for 2013 using the swedish consumer price index ( table  1 in supplement ) . due to lack of data on productivity losses due to t2dm - related complications , we assumed that only severe stages of micro- and macrovascular complications caused loss of production . annual cost of consumption includes costs in added life years and is calculated as the difference in market consumption and production during gained life years . including these costs is required by the tlv in sweden . for the current study , these costs were extracted from a previous study in sweden   inflated to year 2012 using consumer price index ( see supplement for more details ) . baseline utility was modeled using data from a recent study on eq-5d scores in swedish t2 dm patients with no complications . health state utilities for t2dm - related complications and utility decrements associated with age , gender , duration of diabetes , and bmi were derived , whenever possible , from sweden - specific published sources , supplemented with data from other sources if necessary ( table  2 in supplement ) . no utility decrement associated with modality of treatment was applied in the base case analysis . decrement associated with hypoglycemia was extracted from a previous study   which used data from the swedish respondents in a multinational study . a 3% annual discount rate for costs and quality - adjusted life years ( qalys ) was applied in the base case analysis over a 35-year time horizon . while there is no formal willingness - to - pay ( wtp ) threshold for cost - effectiveness ratios in sweden , interventions with less than 500,000 sek per qaly gained the authors conducted a series of one - way sensitivity analyses to assess the impact of variation in the model inputs and assumptions on the results of the base case analysis . in a sensitivity analysis , they excluded the net consumption and productivity losses ( applying healthcare payer perspective ) . the number of weekly smbg performed by patients in the glp-1 agonists  +  metformin and dpp-4 inhibitors  +  metformin groups was varied ( 3 , 5 , and 7 ) , as were the time horizons ( 10 and 20  years ) and the discount rate for costs and qalys ( 0 and 5% ) . a utility decrement of 0.049 for insulin therapy was applied . the annual drift in hba1c was set to 0.10% and 0.20% unit , the cost of one smbg was varied by 10% and 25% , and the cost of t2dm - related complications varied by 20% . no major hypoglycemia and no moderate / major hypoglycemia were assumed for all treatment groups . the treatment effects on hba1c were changed to the lower and upper limits of 95% ci of the main estimate . in addition , the treatment effect on hba1c for nph insulin 60  iu / day was set to 0.56% , 0.35% , and 0.18% . a probabilistic sensitivity analysis ( psa ) was conducted to assess the joint uncertainty of the input parameters using a monte carlo simulation with 1,000 iterations . non - parametric bootstrapping with 1,000 bootstrap samples was then used to calculate the mean and bootstrap bias - corrected ( bbc ) 95% confidence interval ( ci ) of costs and qalys as well as incremental cost - effectiveness ratios ( icers ) . in the psa , costs of treatments and t2dm - related complications varied within a range of 20% from the base case values . microsoft excel and stata 13 ( statacorp lp , college station , tx , usa ) were used for the analyses . the authors conducted this cost  utility analysis using the swedish institute for health economics cohort model for t2 dm ( ihecm - t2 dm ) . this model was previously described and used to compare cost - effectiveness of liraglutide versus sulphonylurea or sitagliptin in sweden . the ihecm - t2 dm is a cohort model consisting of two parallel markov chains covering 120 microvascular health states and 100 macrovascular health states . the microvascular health states include three subgroups : retinopathy , neuropathy , and nephropathy based on the work of eastman et al . , brown et al . , and bagust et al . the macrovascular health states include four subgroups : ischemic heart disease , myocardial infarction , stroke and , heart failure based on united kingdom prospective diabetes study ( ukpds ) outcomes models [ 24 , 25 ] and the swedish national diabetes register ( ndr ) equations . for macrovascular complications , in the current study , the authors used equations from the ndr   in the base case and from the ukpds outcome model-1   in a sensitivity analysis . with this structure , patients can develop multiple complications within each model cycle and over the simulation period . the ihecm - t2 dm has a yearly cycle and a time horizons of up to 40  years can be used . in addition , the user can choose between two sets of mortality risk equations [ 24 , 25 ] . the model also includes evolution of biomarkers over time , treatment algorithms , and treatment - related side effects such as hypoglycemia . eight biomarkers are included in the model and evolution of these biomarkers over time is determined by the initial treatment effects and an annual drift . treatment algorithms include up to eight changes in anti - hyperglycemic treatment composition to account for possible combinations of glucose - lowering agents and treatment intensifications ; this algorithm depends on a user - defined switching threshold of hba1c . the model starts with assigning baseline clinical and demographic characteristics of the cohort , history of complications before diagnosis , and prevalence of diabetes - related complications . this article does not contain any new studies with human or animal subjects performed by any of the authors . this article does not contain any new studies with human or animal subjects performed by any of the authors . the baseline characteristics of the simulated cohort were based on a survey conducted by the swedish national diabetes register . as in this study , the authors evaluated the three second - line therapies as add - on to metformin , they used the data on a sample of patients on metformin monotherapy with hba1c  >  7% consisting 30% of patients on metformin monotherapy in ekstrom et al.s study   ( table  1 , data were provided by the swedish national diabetes register).table  1baseline characteristics of patients on metformin monotherapy with hba1c  >  7% in the swedish national diabetes register ( ndr)variable 
 n 
 value ( sd)age ( years)12,17264.7    11.6diabetes duration ( years)10,9885.6    4.6male ( % ) 7,00057.5smoker ( % ) 1,71017.5hba1c ( % ) 12,1727.7    0.8systolic bp ( mmhg)11,649137    16diastolic bp ( mmhg)11,64979    9total cholesterol ( mmol / l)9,3814.9    1.1hdl ( mmol / l)8,3221.2    0.3ldl ( mmol / l)7,3552.8    0.9triglycerides ( mmol / l)8,2002.1    1.3bmi10,38530.9    5.3 
 bmi body mass index , bp blood pressure , hba1c glycated hemoglobin , hdl high - density lipoprotein , ldl low - density lipoprotein , sd standard deviation baseline characteristics of patients on metformin monotherapy with hba1c  >  7% in the swedish national diabetes register ( ndr ) 
 bmi body mass index , bp blood pressure , hba1c glycated hemoglobin , hdl high - density lipoprotein , ldl low - density lipoprotein , sd standard deviation three treatment strategies evaluated in the study are presented in fig .  1 . in strategies 1 and 2 , patients received the glp-1 receptor agonists and the dpp-4 inhibitors as add - on to metformin , respectively . in both these strategies , patients progressed to nph insulin 40 insulin units ( iu)/day  +  metformin when hba1c exceeded 7.5% and to intensified nph insulin 60  iu / day  +  metformin when hba1c  8% ( the base case analysis ) . in sensitivity analyses , these hba1c threshold values changed to 8% ( switch to nph insulin 40  iu / day ) and 8.5/9% ( switch to nph insulin 60  iu / day ) . in strategy 3 , patients received nph insulin 40  iu / day  +  metformin as initial second - line treatment , then progressed to nph insulin 60  iu / day  +  metformin on reaching the hba1c threshold value of 8% ( the base case analysis ) and 8.5/9% ( the sensitivity analyses ) . comparing strategy 3 with strategies 1 and 2 would provide more insight about timing of insulin initiation in t2 dm patients . in the current study , the glp-1 receptor agonists included liraglutide 1.2  mg daily and exenatide 2  mg once weekly , and the dpp-4 inhibitors are sitagliptin 100  mg daily , saxagliptin 5  mg daily , and vildagliptin 100  mg daily.fig . dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units schematic of treatment strategies applied in the base case analysis . dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units treatment effects were considered as absolute change from baseline in hba1c and weight and the rates of mild , moderate , and major hypoglycemia ( table  2 ) [ 2834 ] . the treatment effects for each drug class were extracted from the literature ; where data at drug class level were not available , the authors used data from head - to - head randomized controlled trials for a single agent in each drug class . the model considers non - severe daytime hypoglycemia as mild and non - severe nocturnal hypoglycemia as moderate hypoglycemia.table  2efficacy of treatments used in the study modelvariableglp-1  +  metdpp-4  +  metnph insulin 40  iu / day  +  metnph insulin 60  iu / day  +  metchange in hba1c ( % ) 0.96 0.69 1.12 0.69change in body weight ( kg)1.80 0.00 3.30 1.80mild hypoglycemia ( per patient per year)0.14 0.14 3.16 3.16 moderate hypoglycemia ( per patient per year)0.05 0.07 1.014 1.014 major hypoglycemia ( per patient per year)0.006 0.01 0.06 0.06 systolic blood pressure ( mmhg)3.20 4.00 2.00 0.00diastolic blood pressure ( mmhg)1.60 1.47 1.00 0.00total cholesterol ( mmol / l)0.01 0.00 0.20 0.00hdl cholesterol ( mmol / l)0.01 0.01 0.00 0.00ldl cholesterol ( mmol / l)0.09 0.09 0.10 0.00triglyceride ( mmol / l)0.10 0.23 0.40 0.00 
 dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , hdl high - density lipoprotein , iu insulin units , ldl low - density lipoprotein , met metformin , nph neutral protamine hagedorn efficacy of treatments used in the study model 
 dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , hdl high - density lipoprotein , iu insulin units , ldl low - density lipoprotein , met metformin , nph neutral protamine hagedorn the authors used data from the literature to estimate the treatment effects due to intensification of insulin from 40  iu / day to 60  iu / day [ 35 , 36 ] . a recent meta - analysis found no direct association between dosage of insulin and risk of hypoglycemia , and so the authors applied the same rate of hypoglycemia events for both insulin treatments in this study . to account for association between hypoglycemic events and changes in hba1c , the reported event rate from a study is transferred to expected event rate using coefficient ( 1.43 ) from a previous study . as in previous studies , no treatment effect on other biomarkers was assumed in the base case analysis [ 3942 ] . when data on treatment effects of nph insulin were not available , the authors used the results from glargine insulin , since previous studies reported no significant difference in treatment effects between nph and glargine insulin [ 4345 ] . treatment effects were applied for the first year after treatment , and then a constant annual drift was assumed for different treatment strategies . the annual drifts in weight were 0.42  kg for insulin and 0.23  kg for other treatments in the base case analysis . in the sensitivity analyses , the authors considered 0.23  kg and 0.1  kg change in weight for all treatments . they assumed 0.3  mmhg and 0.03  mg / dl annual drifts in blood pressure and lipid levels , respectively . prevalence of t2dm - related complications at baseline was extracted from national and international published sources [ 26 , 50 , 51 ] . in the base case , costs were accounted from a societal perspective ( 2013 swedish krona , sek , 1 sek  =  0.115 euros ) and included healthcare costs , productivity losses , and net consumption losses . costs for drugs , self - monitoring blood glucose ( smbg ) test strips , and smbg lancets were collected through the dental and pharmaceutical benefits agency in sweden ( tlv ) . in the base case analysis , the authors calculated a weighted average cost for glp-1 agonists and dpp-4 inhibitors according to consumption of single agents in each class in sweden in 2013 , while in a sensitivity analysis , they applied the price of the lowest cost agent for each drug class ( liraglutide for glp-1 agonists class and vildagliptin for dpp-4 inhibitors class ) . in the base case analysis , based on recommendations by owens et al . , the authors assumed that no smbg is required for patients on dpp-4 inhibitors and glp-1 agonists regimens , and daily monitoring is required for patients on nph insulin regimens . costs associated with t2dm - related complications and treatment side effects were derived from sweden - specific published sources adjusted for 2013 using the swedish consumer price index ( table  1 in supplement ) . productivity losses were measured using human capital approach . due to lack of data on productivity losses due to t2dm - related complications , we assumed that only severe stages of micro- and macrovascular complications caused loss of production . annual cost of consumption includes costs in added life years and is calculated as the difference in market consumption and production during gained life years . including these costs is required by the tlv in sweden . for the current study , these costs were extracted from a previous study in sweden   inflated to year 2012 using consumer price index ( see supplement for more details ) . baseline utility was modeled using data from a recent study on eq-5d scores in swedish t2 dm patients with no complications . health state utilities for t2dm - related complications and utility decrements associated with age , gender , duration of diabetes , and bmi were derived , whenever possible , from sweden - specific published sources , supplemented with data from other sources if necessary ( table  2 in supplement ) . no utility decrement associated with modality of treatment was applied in the base case analysis . decrement associated with hypoglycemia was extracted from a previous study   which used data from the swedish respondents in a multinational study . a 3% annual discount rate for costs and quality - adjusted life years ( qalys ) was applied in the base case analysis over a 35-year time horizon . while there is no formal willingness - to - pay ( wtp ) threshold for cost - effectiveness ratios in sweden , interventions with less than 500,000 sek per qaly gained the authors conducted a series of one - way sensitivity analyses to assess the impact of variation in the model inputs and assumptions on the results of the base case analysis . in a sensitivity analysis , they excluded the net consumption and productivity losses ( applying healthcare payer perspective ) . the number of weekly smbg performed by patients in the glp-1 agonists  +  metformin and dpp-4 inhibitors  +  metformin groups was varied ( 3 , 5 , and 7 ) , as were the time horizons ( 10 and 20  years ) and the discount rate for costs and qalys ( 0 and 5% ) . a utility decrement of 0.049 for insulin therapy was applied . the annual drift in hba1c was set to 0.10% and 0.20% unit , the cost of one smbg was varied by 10% and 25% , and the cost of t2dm - related complications varied by 20% . no major hypoglycemia and no moderate / major hypoglycemia were assumed for all treatment groups . the treatment effects on hba1c were changed to the lower and upper limits of 95% ci of the main estimate . in addition , the treatment effect on hba1c for nph insulin 60  iu / day was set to 0.56% , 0.35% , and 0.18% . a probabilistic sensitivity analysis ( psa ) was conducted to assess the joint uncertainty of the input parameters using a monte carlo simulation with 1,000 iterations . non - parametric bootstrapping with 1,000 bootstrap samples was then used to calculate the mean and bootstrap bias - corrected ( bbc ) 95% confidence interval ( ci ) of costs and qalys as well as incremental cost - effectiveness ratios ( icers ) . in the psa , costs of treatments and t2dm - related complications varied within a range of 20% from the base case values . microsoft excel and stata 13 ( statacorp lp , college station , tx , usa ) were used for the analyses . the simulated profiles of hba1c change over time for three treatments as add - on to metformin are shown in fig . 2 . it can be seen that using the base case threshold values , before switching to insulin therapy , patients on strategies 1 and 2 were expected to receive glp-1 agonists and dpp-4 inhibitors , respectively , for 6 and 4  years . figure  1 in the supplement displays the 35-year cumulative incidence of some major micro- and macrovascular events projected by the ihecm - t2 dm . for all events , the lowest and highest incidences were observed in the strategies 1 and 3 , respectively.fig . hba1c glycated hemoglobin simulated profiles of hba1c in the treatment strategies over the modeled time horizon . glycated hemoglobin the results of cost  utility analysis for the base case are given in table  3 . treatment strategy 1 was associated with an 0.10 and 0.25 units improvement in discounted qalys compared with strategies 2 and 3 , respectively . in addition , treatment strategy 2 was associated with an improvement of 0.15 discounted qalys compared with strategy 3 . on the other hand , from a societal perspective , the treatment strategy 1 was associated with sek 34,865 and sek 40,802 higher discounted costs compared with strategies 2 and 3 , respectively . the icers for strategy 1 versus strategies 2 and 3 were sek 353,172 and sek 160,618 , respectively , and the icer for strategy 2 versus strategy 3 was sek 36,050 . assuming a wtp of sek 500,000 per qaly gained in sweden , strategy 1 could be considered cost - effective compared to either strategies 2 and 3.table  3the results of the base - case cost  utility analysisstrategy 1strategy 2strategy 3difference strategy 1 versus strategy 2difference strategy 1 versus strategy 3difference strategy 2 versus strategy 3discounted qalys4.754.654.500.100.250.15discounted costs  healthcare costs501,594470,084471,99631,51029,5981,912  productivity losses8,9729,47310,5995011,6271,126  net consumption losses1,652,3411,648,4851,639,5103,85712,8318,974total costs2,162,9072,128,0422,122,10534,86540,8025,936icer ( sek)353,172160,61836,050 
 icer incremental cost - effectiveness ratio , qaly quality - adjusted life years , sek swedish krona the results of the base - case cost  utility analysis 
 icer incremental cost - effectiveness ratio , qaly quality - adjusted life years , sek swedish krona overall , the univariate analyses showed that our base case analysis was robust to variation in the inputs and assumptions applied in the model . figure  3 presents the results of the univariate sensitivity analyses as percentage changes in the icer from the base case for comparison of strategy 1 versus strategy 2 . the disutility associated with every unit of bmi over 25 ( 0.006 in the base case ) was a key driver of the results , and excluding it from the analysis caused the icer to rise to sek 661,917 , an 87.3% increase from the base case . while the result of the base case was sensitive to hba1c threshold values , disutility due to mild / moderate hypoglycemia and insulin treatment , and incidence of moderate / major hypoglycemia , in all these cases the icer remained below sek 500,000 ( range : sek 204,517495,368 ) . in the psa , the estimated icer was sek 319,217 ( bbc 95% ci : sek 309,849330,212 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 1 had a 74.7% likelihood of being considered cost - effective in comparison to strategy 2.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 1 versus strategy 2 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose the results of the univariate sensitivity analyses for strategy 1 versus strategy 3 are shown in fig .  4 as percentage changes in the icer from the base case . the key model drivers were disutility of mild / moderate hypoglycemia , the disutility of insulin and bmi over 25 , and incidence of moderate / major hypoglycemia . however , in all these cases , the icer remained below sek 500,000 ( range : sek 85,629256,830 ) . the psa showed that the icer was sek 153,277 ( bbc 95% ci : sek 150,788155,766 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 1 was expected to have a 100% probability of being cost - effective in comparison to strategy 3.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 1 versus strategy 3 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose figure  5 displays the results of the univariate sensitivity analyses for strategy 2 versus strategy 3 as percentage changes in the icer from the base case . the key model drivers were incidence of moderate / major hypoglycemia , the disutility of mild / moderate hypoglycemia , including costs of 7 smbg per week for the dpp-4 inhibitors , and the disutility of insulin . moreover , excluding net consumption and productivity loss , and applying the price of the cheapest dpp-4 agent , translated into dominance of strategy 2 versus strategy 3 . the icer from the psa was sek 40,277 ( bbc 95% ci : sek 37,43643,119 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 2 was expected to have a 98.1% probability of being cost - effective in comparison to strategy 3.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 2 versus strategy 3 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose overall , the univariate analyses showed that our base case analysis was robust to variation in the inputs and assumptions applied in the model . figure  3 presents the results of the univariate sensitivity analyses as percentage changes in the icer from the base case for comparison of strategy 1 versus strategy 2 . the disutility associated with every unit of bmi over 25 ( 0.006 in the base case ) was a key driver of the results , and excluding it from the analysis caused the icer to rise to sek 661,917 , an 87.3% increase from the base case . while the result of the base case was sensitive to hba1c threshold values , disutility due to mild / moderate hypoglycemia and insulin treatment , and incidence of moderate / major hypoglycemia , in all these cases the icer remained below sek 500,000 ( range : sek 204,517495,368 ) . in the psa , the estimated icer was sek 319,217 ( bbc 95% ci : sek 309,849330,212 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 1 had a 74.7% likelihood of being considered cost - effective in comparison to strategy 2.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 1 versus strategy 2 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose the results of the univariate sensitivity analyses for strategy 1 versus strategy 3 are shown in fig .  4 as percentage changes in the icer from the base case . the key model drivers were disutility of mild / moderate hypoglycemia , the disutility of insulin and bmi over 25 , and incidence of moderate / major hypoglycemia . however , in all these cases , the icer remained below sek 500,000 ( range : sek 85,629256,830 ) . the psa showed that the icer was sek 153,277 ( bbc 95% ci : sek 150,788155,766 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 1 was expected to have a 100% probability of being cost - effective in comparison to strategy 3.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 1 versus strategy 3 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose figure  5 displays the results of the univariate sensitivity analyses for strategy 2 versus strategy 3 as percentage changes in the icer from the base case . the key model drivers were incidence of moderate / major hypoglycemia , the disutility of mild / moderate hypoglycemia , including costs of 7 smbg per week for the dpp-4 inhibitors , and the disutility of insulin . none of these changes had a significant impact on the cost  utility conclusions . moreover , excluding net consumption and productivity loss , and applying the price of the cheapest dpp-4 agent , translated into dominance of strategy 2 versus strategy 3 . the icer from the psa was sek 40,277 ( bbc 95% ci : sek 37,43643,119 ) . assuming a wtp of sek 500,000 per qaly gained , strategy 2 was expected to have a 98.1% probability of being cost - effective in comparison to strategy 3.fig . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose results of one - way sensitivity analyses : strategy 2 versus strategy 3 . bmi body mass index , ci confidence interval , dpp-4 dipeptidyl peptidase-4 , glp-1 glucagon - like peptide-1 , hba1c glycated hemoglobin , iu insulin units , smbg self - monitoring blood glucose the authors applied a cohort model ( ihecm - t2 dm ) to examine the long - term costs and health benefits of three different treatment strategies as add - on to metformin monotherapy in a representative sample of t2 dm patients not achieving hba1c  <  7% on metformin monotherapy in sweden . the results show that , assuming a wtp value of 500,000 sek , the treatment strategy with glp-1 agents is cost - effective in comparison to treatment strategies with either dpp-4 inhibitors or nph insulin from both a societal and a healthcare payer perspective . compared with treatment strategies of dpp-4 inhibitors and nph insulin , the cost per qaly gained with glp-1 agonists was approximately sek 353,000 and sek 161,000 , respectively . the results from this study indicate that later transition to nph insulin ( i.e. , as third - line therapy after providing incretin - based therapies ) is cost - effective with the icers less than 200,000 sek . while there was no significant difference in hypoglycemic episodes between glp-1 agonists and dpp-4 inhibitors , glp-1 agonists were associated with a higher reduction in hba1c and greater weight loss . these effects influence health outcomes in two ways : first , there is a direct effect in terms of lower cumulative incidence of t2dm - related complications , and second , there is an indirect effect through delay in switching to nph insulin . the higher reduction in hba1c meant that patients on glp-1 agonists initiated nph insulin therapy later than patients on dpp-4 inhibitors , resulting in fewer expected episodes of hypoglycemia in the lifetime perspective . these health benefits partly offset the higher price of glp-1 agonists compared with dpp-4 inhibitors , and this is in line with previous modeling studies comparing liraglutide with sitagliptin [ 20 , 6163 ] . the one - way sensitivity analyses in this study showed that this finding was most sensitive to the disutility due to bmi : assuming no disutility due to bmi > 25 resulted in an icer higher than sek 500,000 per qaly gained . this is mainly due to significant difference between these two drug classes in weight changes ( 1.8  kg reduction versus no change ) and implies that besides the effects on improved glycemic control , the effects on weight also play important role in cost - effectiveness of treatments in the t2 dm context . in line with a previous study , this finding suggests that there should be a sub - group of patients with bmi > 25 where treatment strategy with glp-1 agonists is even more cost - effective in comparison to dpp-4 inhibitors . in particular , a previous study in sweden showed that bmi is a significant predictor of other biomarkers in t2 dm patients . this implies that taking this association into account might decrease the icer in favor of glp-1 agonists , due to its effect on weight loss . the results were robust to other assumptions , and the icer remained below sek 500,000 . the icer reported in the current study is higher than in a previous study in sweden   that used the same model to compare liraglutide versus sitagliptin . differences in utility decrement , the baseline characteristics , and treatment effects might be potential explanations for different icer values . the icer is also higher than in previous studies in other countries [ 6163 ] . beside differences mentioned earlier , there are differences in perspective ( societal versus healthcare payer ) , and applied model that limits comparability of this study with previous ones . all these studies applied the core diabetes model , which mainly uses risk equations from the ukpds outcome model-1   for macro- and microvascular complications . the authors used a different model ( i.e. , the ihecm - t2 dm ) , which applies different risk equations including swedish - specific macrovascular risk equations [ 2123 , 26 ] . in the comparison of incretin - based therapies against nph insulin , while nph insulin was associated with higher hba1c reduction , it resulted in weight gain and a higher number of hypoglycemic episodes . the estimated icer of both incretin - based second - line treatment strategies ( 1 and 2 ) remained below sek 500,000 . this finding is in line with a previous cost  utility analysis comparing the dpp-4 inhibitor saxagliptin against nph insulin as add - on to metformin in poland . in these treatment strategies , patients on incretin - based therapies benefit from an extra treatment compared with patients who initiate nph insulin as second - line treatment , and this finding implies that the health benefits of providing second - line treatment prior to insulin introduction offset the higher prices of these medications . however , it should be noted that the cost - effectiveness of incretin - based therapies decreased as the hba1c switching threshold value to nph insulin increased . this implies that as the number of years on these treatments increases , the marginal costs of the treatments outweigh the marginal benefits , and the icer rises . the similar finding was observed in a previous study in sweden using the same model . the one - way sensitivity analyses showed that the results were most sensitive to the assumptions related to incidence of hypoglycemia and disutility of hypoglycemia and insulin . the main strengths of the current study include : applying the baseline characteristics from a large sample of t2 dm patients from routine practice in sweden , using utility decrements for a number of complications from a swedish sample with t2 dm , applying swedish - specific risk equations for macrovascular complications , and extracting treatment effects on the main biomarkers ( i.e. , hba1c and weight ) from a meta - analysis instead of a single clinical trial . in addition , the authors used hba1c threshold to determine the treatment pathway , reflecting clinical practice and national guidelines . these strengths improve the external validity and relevance of these results for policy making in the swedish setting . the results of the current study should be interpreted in light of a number of cautions . the authors included only hypoglycemia as a treatment - related adverse event in the model . the results of the 1860-lira - dpp-4 ( liraglutide dipeptidyl peptidase-4 inhibitor ) trial showed no significant difference in other adverse events between liraglutide and sitagliptin . on the other hand , previous studies [ 30 , 66 ] reported higher episodes of non - hypoglycemia - related adverse events such as nausea for glp-1 and dpp-4 agents compared with insulin glargine . if insulin glargine and nph insulin are comparable with respect to adverse events , then the authors reported icers in comparing glp-1/dpp-4 against nph insulin are underestimated to some extent . however , the authors do not expect this to have influenced the final conclusion , as these icers are long way from our assumed sek 500,000 wtp value . as they had no clinical trial data regarding the effects of treatment on diabetes - related complications , the authors applied the commonly used method of using biomarkers ( e.g. , hba1c and weight ) as surrogate markers for these complications . due to lack of data , the authors did not take into account the possibilities of treatment discontinuation by patients and different annual drifts for different treatments . however , these are common modeling practices , and the authors tried to consider the possibility of different annual drifts in the psa , assuming a normal distribution for annual drift in biomarkers . it should be mentioned that their conclusions are based on a baseline hba1c of 7.7%  0.8 , and generalizability to patients with lower and higher hba1c values at baseline is limited . especially , as it was recommended by the american diabetes association and the european association for the study of diabetes , starting treatment with insulin should be strongly considered for patients with dramatically high hba1c or significant hyperglycemic symptoms . pooling agents into classes ( i.e. , glp-1 and dpp-4 ) implies that agents within a drug class have similar efficacy . the results of meta - analysis on individual agents in the authors main source ( i.e. , ref . ) supported this assumption and conducting the class - level analysis . from both a societal and a healthcare payer perspective , treatment with glp-1 agonists is a cost - effective treatment strategy in comparison to dpp-4 inhibitors and nph insulin as second - line therapy among t2 dm patients inadequately controlled with metformin alone in a swedish setting . supplementary material 1 ( pdf 195  kb ) supplementary material 2 ( pdf 291  kb ) b. eliasson has participated in advisory board for eli lilly , sanofi , msd ; and received payment for lectures by sanofi , msd , and novo nordisk . this article does not contain any new studies with human or animal subjects performed by any of the authors . this article is distributed under the terms of the creative commons attribution noncommercial license which permits any noncommercial use , distribution , and reproduction in any medium , provided the original author(s ) and the source are credited .