In most industries something that offers no advantage over its
competitors and yet sells for twice the price would never even get on
the market. But that is not how things work for drugs. The Food and Drug
Administration approves drugs if they are shown to be “safe and
effective.” It does not consider what the relative costs might be once
the new medicine is marketed.
By law, Medicare must cover every cancer drug the F.D.A. approves. (A 2003 law, moreover, mandates
payment at the price the manufacturers charge, plus a 6 percent
cushion.) In most states private insurers are held to this same
standard. Physician guideline-setting organizations likewise focus on
whether or not a treatment is effective, and rarely factor in cost in
their determinations. Ignoring the cost of care, though, is no longer tenable. Soaring
spending has presented the medical community with a new obligation. When
choosing treatments for a patient, we have to consider the financial
strains they may cause alongside the benefits they might deliver.
This is particularly the case with cancer, where the cost of drugs,
and of care over all, has risen precipitously. The typical new cancer
drug coming on the market a decade ago cost about $4,500 per month (in
2012 dollars); since 2010 the median price has been around $10,000. Two
of the new cancer drugs cost more than $35,000 each per month of
treatment.
The burden of this cost is borne, increasingly, by patients themselves — and the effects can be devastating. In 2006, one-quarter of cancer patients reported that they had used up all or most of their savings paying for care; a study last year reported that 2 percent of cancer patients were driven into bankruptcy by their illness and its treatment. One in 10 cancer patients now reports spending more than $18,000 out of pocket on care.
Which brings us back to our decision on Zaltrap. In patients with advancing, metastatic colorectal cancer, the new drug, approved by the F.D.A. in August and jointly marketed by Sanofi and Regeneron, offers the same survival benefit as Genentech’s Avastin, which works through a similar molecular mechanism. When compared with the standard chemotherapy
regimen alone, adding either medicine has been shown to prolong patient
lives by a median of 1.4 months. Major clinical practice guidelines,
like those from the National Comprehensive Cancer Network,
agree that Zaltrap is no better than Avastin in this setting. (Full
disclosure: Two of us, Dr. Bach and Dr. Saltz, have been paid consulting
fees by Genentech.)
But Avastin costs roughly $5,000 a month: very expensive in its own
right, yet less than half of Zaltrap’s price tag. And while the side
effects in both drugs are roughly equal, doses of Avastin generally take
less time to administer than those of Zaltrap, which makes Avastin more
convenient for patients.
Consider that colorectal cancer is typically diagnosed in older
individuals and the cost issue becomes starker still. Many patients are
on Medicare and living on fixed incomes. And because Medicare requires
patients to co-pay for cancer drugs, 20 percent of the cost of drugs
like Zaltrap and Avastin is passed on — absorbed either by supplemental
insurance or by the patients themselves.
To put these percentages in perspective, an older colorectal cancer
patient without extra insurance would have to pay more than $2,200 out
of pocket for a month’s treatment with Zaltrap. That’s greater than the
monthly income for half of Medicare participants.
... It may seem surprising that the
decision to exclude Zaltrap from our hospital’s formulary was a hard one
to make. But because our medical culture equates “new” with “better” so
unequivocally, a decision like this one can seem out of place at a
leading cancer hospital.
Political rhetoric today is similarly slanted. Our refusal to adopt this
remarkably expensive therapy risks being labeled “rationing,” not
rational.
This political climate also helps explain why the Affordable Care Act
precludes Medicare from changing its coverage or payment amounts based
on cost comparisons like the one we have outlined, even when two drugs
appear to work equally well....
But if no one else will act, leading cancer centers and other research
hospitals should....
The current level of spending on health care, estimated to be $2.8 trillion this year, is already too high. The growth rate in health spending is unsustainable.
Of course, we know our decision about Zaltrap will not meaningfully
address these larger problems. Projected United States sales of Zaltrap
in 2013 are less than $150 million, or 0.005 percent of all dollars
spent on health care....
by Peter B. Bach 1, Leonard B. Saltz 2 and Robert E. Wittes 3, all doctors at Memorial Sloan-Kettering Cancer Center
1. director of the Center for Health Policy and Outcomes,
2. chief of the gastrointestinal oncology service and chairman of the pharmacy and therapeutics committee
3. physician in chief.
October 14, 2012
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