Thursday, 5 November 2015

PoliticalSpeak: high cost drugs

The issue of high-cost drugs is not going away soon. #PoliticalSpeak #MSBlog

"It is reassuring to note that the world's most influential medical journal, the New England Journal of Medicine, has two perspectives this week on high-cost drugs; they are almost a debate. It seems the discussions we, on the blog, have been having on this issue is very timely. Rather than bore you with the details I have posted some excerpts from  the two perspectives that cover well rehearsed issues. It is interesting to note that neither of the authors' cover the issue of repurposing of off-patent drugs; this surely is a way of keeping development costs down and ultimately making drugs cheaper."


Perspective 1:
Peter Bach. New Math on Drug Cost-Effectiveness. N Engl J Med 2015; 373:1797-1799. 

Excerpts:

..... Nowadays, the reality of exorbitant drug pricing overshadows even the most exceptional stories of drug efficacy.....

..... The price hurts patients, limiting their access and depleting their savings.....

..... The high costs of ...... care also drive patients into bankruptcy.....

..... Policymakers, stymied by the rising cost of drugs, might think that an approach that relies on cost-effectiveness analyses would help the health care system deal with the high price of new treatments. After all, the United Kingdom sets standards for cost-effectiveness at about $40,000 per quality-adjusted life-year for new drugs, and overall health care spending there is a fraction of what it is in the United States.......

...... Of course, this potential solution remains theoretical today, since Medicare cannot limit drug access on the basis of cost-effectiveness; rather, laws require Medicare to cover all cancer drugs for all uses approved by the Food and Drug Administration (FDA) or listed in recognized compendia and to pay the price the manufacturer chooses to charge. But even if Medicare could set such limits, I believe that policymakers would find limited relief from the approach......

...... Expensive drugs can still seem deceptively cost-effective, because of the long upward spiral we have seen in the prices of cancer treatments. For example, everolimus costs about $41,000 for a course of treatment, which makes the incremental cost of nivolumab only $24,000, even though it actually costs $65,000......

...... This point may seem like a finicky one, but it actually highlights a critical limitation of cost-effectiveness analysis as a tool for distinguishing the value of different treatments. Highly expensive but poorly effective treatments look good when they are marginally superior on either dimension (i.e., slightly less expensive or slightly more effective) to the treatment they are replacing......

..... Hand clapping for science is now inextricably linked to hand wringing over affordability. Drug prices are increasing more rapidly than their benefits, and the growth in spending on drugs has started to outstrip growth in other areas of health care. Addressing this problem requires realizing that cost-effectiveness assessment — a step that we are not even ready for in the United States — has limitations when one considers the price of the comparator and the impact on overall budgets......


Perspective 2

William Chin. A Delicate Balance — Pharmaceutical Innovation and Access. N Engl J Med 2015; 373:1799-1801.

Excerpts

..... I believe ongoing biopharmaceutical advances hold great promise for us all, and they lie at the center of a national debate over the cost and value of health care in general and new medicines in particular.....

...... This debate demands our attention, because whereas it is essential to accelerate scientific and medical progress, it's also critical to ensure that patients have affordable access to the care they need, want, and deserve. For the sake of patients, we need to strike a delicate balance in policies that achieve both biopharmaceutical innovation and access.....

..... Medications also generate benefits that cascade through our health care system, by improving patients' productivity and quality of life, extending lives, and averting more costly hospital and institutional care.....

....... It's possible to deliver so many new medications to patients while still managing costs because the United States relies on competitive markets to set prices and encourage innovation — a system that, as I see it, is working well......

...... After approval by the Food and Drug Administration, a new medication enters a market that is increasingly characterized by competition from other brand-name and generic drugs in the same therapeutic class. This market then does its work. Payers demand demonstration of value and drive patients to the lowest-cost options using aggressive cost-containment strategies: tiered cost sharing, prior authorization, step therapy, and incentives for prescribers to adhere to preferred clinical pathways......

...... At the end of a brand-name medication's lifecycle, generic competitors enter the market, mostly capitalizing on innovative biopharmaceutical companies' prior work. The United States makes more efficient use of generics than other countries: nearly 90% of all U.S. prescriptions are filled with generics that are sold at a fraction of the price of the original brand-name medication, helping ensure long-term affordability......

....... And the new biosimilars pathway is expected to deliver additional cost savings. No other part of the health care system delivers this type of built-in savings......

....... Our system recognizes the considerable challenges and expense of the research and development process and the need to reward innovation, and it balances these needs against access......

....... As we move forward, I believe we must recognize that what determines value is varied and individual, and any centralized government-purchasing model would probably result in drastically limited choices for physicians and patients. In the United Kingdom, for example, use of a national cost-effectiveness standard has created barriers to patients' access to many important new cancer treatments. In fact, in 2013, the U.K.'s National Institute for Health and Care Excellence recommended against coverage of all six cancer medications it reviewed......

....... As we strive to advance both innovation and access, I argue that we must also avoid creating new systems that would eliminate the very incentives that have fostered U.S. innovation for decades. After all, U.S. research and development has vastly outperformed that of former biopharmaceutical powerhouse countries such as Germany and Switzerland, which have instituted price controls that limit patient choice......

CoI: multiple

4 comments:

  1. So the capitalist argument reigns supreme? We pay for high cost drugs that allow Pharma to innovate and we eventually get them cheap when they come off patent. Whilst they are protected we let the fat cats make as much money as possible, but not so much money because their is competition and hard bargaining to be had by payers. Despite this Joe Soap, his wife and his kids may, or may not, go bankrupt of one of them gets ill and needs a high cost drug. The fact that America allows this system makes it king of the castle on innovation and out competes their Pharma rivals in Switzerland, Germany and Britain (I thought there was no Pharm left in Britain, note I have dropped off the Great).

    Capitalism sucks; sucks money up the Ponzi vacuum cleaner to the Pharma CEOs who grease the rails the Pharma gravy train runs on! The Pharma gravy train in turn makes sure the Pharma CEOs and their management teams get big fat bonuses every year. This all works very well, but the imbalance in markets makes it unsustainable. Just wait and see!

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  2. Hi MouseDoctor and Dr. Giovannoni. MS patients would pay any price for an "effective" drug measured in terms of disability progression and/or remyelination. The problem with many of the MS drugs is they simply do not work well enough to justify their costs. For example, the new Hepatitis C drug Harvoni offers around a 95+% cure rate, far superior to previous interferon therapy. The new melanoma drugs, like Keytruda, offers significant improvement in morbidity and mortality over the previous chemotherapies. I believe, as a physician, that their expense is justified because they actually work. Many of the older CRAB drug's efficacy do not justify their costs as they have minimal effect above placebo at decreasing frequency of relapses (~30%) and have no effect disability progression. Yet, their companies have taken the liberty of raising the prices on these inferior drugs that should probably be obsolete. The bar needs to be set much higher by researchers, physicians and journals when it comes to judging, prescribing and approving any new MS medications. The MS world does not need any more of these recycled inefficacious drugs or their derivatives, especially at an outrageous cost.

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  3. I started writing about drug costs in the U.S. back in March. http://thelifewelllived.net/2015/03/10/710/

    I've talked with a Senator and recently with a couple of pharmaceutical CEO's at an open meeting on the FDA's REMS program trying to come up with a solution palatable to the public and the companies. The only one I have come up with involves changing U.S. patent law to allow the U.S. to buy patents and instantly make them public to allow for generic production. In looking into this, a pharmaceutical company's CEO told me this is already law, only their is no "buying." The U.S. can just take a patent. However, this has only been threatened in the past, and the example he gave me was Cipro when the Anthrax scare happened in the U.S. Congress started deliberating on taking the patent to make sure enough was produced and available. When they did that, the original company brought the price way down...to the point where it has been prescribed multiple times in our house without being a big deal to get coverage approved. I was referred to contact Aaron Kesselheim, currently at Harvard, for more information on the legal options, but thus far I have been unable to reach him.

    There are solutions out there if the problem is ever widely enough viewed to require them. I think the fear runs along the lines of a Bruce Willis quote in a movie about using the army to secure a city from terrorism, "It's like using a broad sword when you want a scalpel." We need to invest in scalpels.

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