Modern cancer therapeutics saved $350-billion

Center for medicine in the public interest says economic analysis shows modern cancer therapeutics saved $350-billion in hospitalization costs since 1990

--Facts Refute Recent Challenges to the Cost of Cancer Drugs--

----CMPI Says a Balanced View Is Needed so that Medical Innovation Continues, New Therapies Can Be Developed, and Long Term Healthcare Costs Can Actually Decrease----

---A Three Step Program to Reduce Regulatory Time and Costs Could Improve Affordability and Availability of Life-Changing New Treatments---

Modern cancer therapeutics saved $350-billion

New York, NY – May 5, 2014 --- At a time when cancer kills nearly 1,600 Americans every day, the Center for Medicine in the Public Interest (CMPI) – a not-for-profit organization the advocates for consumer access to medical innovation – refuted a recent spate of challenges to the cost of innovative cancer drugs, calling for a balanced debate that considers the overall economic value of these therapies, including cost savings from less hospitalizations, emergency room visits, physician office appointments and home health care.

A CMPI economic analysis shows that since 1990, there has been a need for fewer hospitalizations because of medical innovation – including oral medications that can be administered at home. This has resulted in savings of more than $350 billion dollars, and that doesn’t include the increased productivity of and improved outlook for patients who are living better and longer lives.

CMPI also urged decision-makers to move away from a “one-size fits all” discussion of the costs of new cancer treatments to a recognition that many new cancer therapeutics are for rare cancers that require expensive phase-3 clinical trials involving hard-to-find trial subjects, while at the same time genomic studies and other new scientific predictors target drugs toward smaller groups of patients. Certain cancers are so rare that they are diagnosed in only a few hundred patients annually.

“The cost of developing a new therapeutic is the same whether for 10 thousand patients or 10 million, so a drug developed for a targeted group of patients costs more by definition,” said Robert Goldberg, Ph.D., Vice President and co-founder of the Center for Medicine in the Public Interest. “Nevertheless, because these therapeutics are more effective and often allow patients to remain productive members of society, their value is far greater than their cost.”

Among the figures CMPI cites:

Goldberg also compared cancer survival rates in the U.S. and Europe, underscoring the “return on investment” from greater access to innovative therapies among American cancer patients. Referencing a 2010 study comparing survival gains between 1983 and 1999, Goldberg reported that U.S. cancer patients survived approximately two years longer than those in Europe, generating $598 billion of additional value on average. (Source: Darius Lakdawalla et al., “An Economic Evaluation of the War on Cancer,” Journal of Health Economics 29 (2010):333-46).

“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,” Golderg said. “Focusing on cost alone is imprudent and misses the broad opportunities for substantial economic gains along with higher quality of life and increased productivity. A balanced view of the data is needed so that medical innovation continues to be incentivized, new therapies can be developed, and long term healthcare costs can actually decrease.”

Still, there are patients who cannot afford their drugs or the treatments they need. CMPI points out they represent about 10 percent of cancer patients.

Goldberg added: “That’s still ten percent too many but most of these cases can be resolved by insurance changes, such as not shifting costs to the patients, and not letting insurance companies reimburse less for oral cancer therapies than for IV treatments; intuitively that’s actually backwards. Thanks to the work of advocates and innovators, parity for oral-therapy reimbursement is now required by law in 34 states and growing. In addition, many pharmaceutical companies have patient support programs, and we urge all patients who are having financial trouble filling their prescriptions to contact them directly.”

Innovative new therapeutics are being discovered faster than ever before, but CMPI points out the drug development process and most important the regulatory approval process can take up to 15 years. Revamping the regulatory process can get essential therapies to patients faster and relieve pressures that force costs to rise, while not blaming medical innovators for the life–changing benefits and economic contributions that underlie the economics of healthcare.

CMPI recommends three fundamental steps that could happen immediately: Cut regulatory costs in half, cut the time to approval in half, and approve new therapies for an entire disease state without requiring expensive and time consuming phase-3 studies for each subset of patients, such as newly diagnosed. These simple steps could improve the affordability and availability of innovative new therapies for patients with life-threatening, orphan cancers and other diseases.

About CMPI

The Center for Medicine in the Public Interest is a nonprofit, nonpartisan research and educational organization that seeks to advance the discussion and development of patient-centered health care.

Media Contact:
Stephen Gendel 646-237-6926

By Robert M. Goldberg, PhD

May 9, 2014

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