Have you read up on demodectic manage at all? It is a mite that is not contageous as most dogs already have these mites on their bodies. Generally, a dog with demodectic mange has a depleated immune system, so their natural immune system is not fighting the mites - as it would in most normal, healthy dogs...
We often treat dogs with demodectic mange with a product called "advantage multi". This is an oil which you apply between the shoulder blades - it fights fleas, ticks, parasites and mange mites...
We have also used Ivermectin and it is very effective - but note that it is toxic to Austrailan Shepherds, Collies and crosses of these breeds! It can be very effective in treating mange... I am pretty sure you are NOT supposed to use flea collars with Ivermectin. You may be overdosing your dog!
The very best treatment for mange alongside Ivermectin is simply time to re-built his immune system. Get him on a good quality diet, make sure that he is up-to-date on vaccinations, and keep him healthy and happy. Make sure he gets exercise, affection and love - because when his immune system gets back into shape - it will take care of everything else
I was just re-reading your post. Please go back to your vet and change medications! There is a genetic mutation of the MDR1 gene which is common in Australian Shepherds and Collies. Ivermectin and other anti-parasitics can be toxic to dogs with this genetic mutation. Vets normally never prescribe Ivermectin for these breeds because of this! Do a search on the internet if you like - type "Ivermectin Australian Shepherds" and see for yourself... It is a known and common problem... Actually, if you read the info with the Ivermectin, I know it says it in there as well... I really hope your dog is okay!