Estimation and Validation of Ratio-based Conditional Average Treatment Effects Using Observational Data

TL;DR

This paper introduces a novel ratio-based method for estimating conditional average treatment effects in observational data, addressing model misspecification issues and providing validation techniques, with applications to multiple sclerosis treatment data.

Contribution

It proposes a doubly robust estimator for ratio-based CATE and a validation procedure, improving causal inference in observational studies with treatment-covariate interactions.

Findings

The estimator performs well in finite samples in simulations.

Application to multiple sclerosis data shows meaningful treatment effect estimates.

Validation procedure effectively assesses estimator quality.

Abstract

While sample sizes in randomized clinical trials are large enough to estimate the average treatment effect well, they are often insufficient for estimation of treatment-covariate interactions critical to studying data-driven precision medicine. Observational data from real world practice may play an important role in alleviating this problem. One common approach in trials is to predict the outcome of interest with separate regression models in each treatment arm, and estimate the treatment effect based on the contrast of the predictions. Unfortunately, this simple approach may induce spurious treatment-covariate interaction in observational studies when the regression model is misspecified. Motivated by the need of modeling the number of relapses in multiple sclerosis patients, where the ratio of relapse rates is a natural choice of the treatment effect, we propose to estimate the conditional average treatment effect (CATE) as the ratio of expected potential outcomes, and derive a doubly robust estimator of this CATE in a semiparametric model of treatment-covariate interactions. We also provide a validation procedure to check the quality of the estimator on an independent sample. We conduct simulations to demonstrate the finite sample performance of the proposed methods, and illustrate their advantages on real data by examining the treatment effect of dimethyl fumarate compared to teriflunomide in multiple sclerosis patients.