A recent New York Magazine article titled "The Cost of Living" calls attention to the expense of new life-extending drugs. According to the article, this expense is leading some doctors to refuse to use the drugs. The article spotlights "Leonard Saltz, who heads the gastrointestinal oncology group at Memorial Sloan-Kettering Cancer Center" and his perspective on the rising cost and use of new medications such as Zaltrap, "a safe and effective treatment for patients with advanced colon cancer." In accordance with a recommendation from Saltz, the medication would not be offered to patients at the hospital. “It’s never happened before! Sloan-Kettering isn’t including a drug because of its price?" remarked Peter Bach, Director of the Center for Health Policy and Outcomes at Sloan-Kettering.
To fairly evaluate the cost, effectiveness, and who should or shouldn’t receive new cancer therapies, we have to look beyond price to consider the larger, long term impact. The Value of Medical Innovation has shown that focusing on cost alone is imprudent and misses the broad opportunities for higher quality of life, increased productivity, and substantial economic gains. We believe a balanced view of the data is needed so that innovation continues to be incentivised, new therapies can be developed, and long term healthcare costs can decrease.
A balanced view of the numbers is needed
Since 1990, new cancer medicines have doubled the number of cancer survivors: from 6 million to 13 million. These new medicines have increased survival among cancer patients by approximately 43 million life-years.
These are not life-years of pain and desperation: The added value of these longer lives is about $4.7 trillion. And every dollar we spend on new cancer medicines reduces spending on hospitals and doctors by 7 dollars. All told, such innovative treatments add up to about one percent of total healthcare spending.
The real value: a prolonged decline in cancer death rates
Cancer drugs targeting the genetically controlled mechanisms that cause tumors to start and spread can deliver a knockout blow to individual tumors. That’s where we’ve made the most progress.
Columbia University economist Frank Lichtenberg looked at the relationship between medical innovation and death rates for about 60 cancers. Lichtenberg found that between 1990 and 2000, newer treatments, paired with tests that hone in on one specific tumor, accounted for about 65 percent of the drop in cancer death rates. Such personalized cancer treatment accounted for 100 percent of the decline between 2000-2010.
The myopic focus on launch prices results in short-sighted opinions
As the New York Magazine article states, “the unspoken rule in American health care is that doctors should never consider the cost of a medicine that might be beneficial to patients… Any doctor who considers cost — or the value of a costly drug — risks being accused of 'rationing' health care.”
Before effective treatments for tuberculosis, HIV, heart disease, and cancer were developed, the cost of saving a life was, in effect, infinite. That is, one could not keep a patient from dying of those diseases, even if one spent unlimited amounts of money. The human and economic cost of such a state of affairs is captured by any account of the Great Flu of 1918 or of the AIDS epidemic, especially in Africa and Central Asia.
The launch prices, in real and current dollars, for medicines to combat these scourges were extremely high. The initial cost of a course of penicillin to treat strep throat was about $10,000 in today’s dollars. The first anti-HIV drugs easily cost $10,000 a year in 1989; yet under pressure from HIV patients and advocates, new drugs that radically improved outcomes were developed and approved.
The claim that we can't sustain progress without running out of money or bankrupting economies is not new: it’s the same fear-mongering that has been waged against medical innovation for two centuries. Would these doctors refuse to use new, high-priced cancer medicines if they or their loved ones were dying? That would be a wonderful example of being a principled critic.