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Copied from Indication (medicine)

In medicine, an indication is a valid reason to use a certain test, medication, procedure, or surgery. There can be multiple indications to use a procedure or medication. An indication can commonly be confused with the term diagnosis. A diagnosis is a particular [medical] condition while an indication is a reason for use. An indication for a drug refers to the use of that drug for treating or preventing a disease, or relieving a disease's symptoms.

The opposite of an indication is a contraindication, a reason to withhold a certain medical treatment because it could harm a patient.

In the United States, medication indications are determined by the FDA and are grouped into either labeled indications, which are FDA-approved or off-label indications which are not approved. Currently in the US, including the indication or purpose of use for a drug is not required on prescription labels. However, manufacturers of prescription drugs are required to include an "Indications and usage" section on the prescribing information or package insert.

Drugs
Most countries and jurisdictions have a licensing body whose duty is to determine whether to approve a drug for a specific indication, based on the relative safety of the drug and its efficacy for the particular use. In the United States, indications for medications are regulated by the Food and Drug Administration (FDA), and are included in the package insert under the phrase "Indications and Usage". The European Medicines Agency (EMA) holds this responsibility for centrally authorized drugs in the European Union.

There are different classes of indication of drugs depending on validity of the benefit gained by the use of specific drug. If a drug's use is officially indicated it is "FDA approved" (also called 'labeled') and if prescribed for other conditions the term "non-approved" (or 'off-label') is used. Preferred drugs (and other treatments) are also referred to a "first line" or "primary" while others are called "second line", "third line" etc. A drug may be indicated as an "adjunct" or "adjuvant", added to a first line drug.

Pros:
Indications based prescribing can contribute to better prescribing and medication use in many ways
 * Medication choices are narrowed to those indicate for a specific problem, decisions are much less prone to error
 * Staff and patients could then easily recognize any mismatches and intercept prescribing or dispensing errors
 * This could also eliminate errors related to drugs whose names look alike/sound alike. (i.e. hydralazine for itching vs. hydroxyzine for hypertension)
 * Significantly decrease drug-indication mismatches, making it easier for pharmacists to detect
 * Patients will understand and adhere to their medication more if they know what they’re taking it for.
 * Family members will also be able to identify what medication someone is on by looking at the label
 * Will help physicians see what indications a patient may have and this will allow physicians to make even quicker clinical decisions

Cons:

 * Physicians say it may take too much time to include
 * Can introduce some room for error; pharmacist needs to verify if dose is correct indication
 * Confidentiality may be compromised since the label will disclose what disease a patient has
 * The indication may not fit onto a prescription drug label
 * Drug can be used multiple indications
 * Different conditions can be subdivided differnetly (prophylaxis vs. definitive therapy) so the dose needs to be checked

Effect on Drug Pricing
Indications can impact pricing of medications through Value-based Pricing, also known as indication specific pricing or indication value-based pricing. Currently, most medications in the United States are priced the same regardless of what they're being used for. Companies like CVS and Express Scripts in the US have discussed pricing based on indication and in countries like Italy and Australia, this form of pricing is already being used.