Should insurance companies or patients pay $6000 to $10,000 a month for a cancer drug that extends life five months on average? Should oncologists be marking the drug up to make money on it? Should the drug manufacturer keep the price so high it keeps it out of the reach of many potential patients ?
Avastin is a drug approved by the FDA for colorectal cancer and is used primarily in advanced stages of the disease. Manufactured by Genentech, it works in conjunction with other, tumor-fighting drugs to slow the spread of cancer by reducing the blood flow to tumors. And it does appear to do this pretty well. This success has led physicians to consider using it in early stages, but there are two problems with this.
First, it has not been approved by the FDA for that usage. As a result, many insurance companies may not pay for it. Therefore this leaves doctors and patients facing the all-too-common financial conundrum – is it worth it? An article in the New York Times (free subscription required) describes the decision making process of several cancer victims, some of whom cannot afford the drug and are not taking it due to cost.
Before we start hurling invective at the insurance companies, remember that they are spending your dollars. So ask yourself the question – do you want your personal funds paying for these drugs?
Another medication, Gleevec, has shown excellent results for leukemia patients, extending life significantly albeit at a very high price.
Genentech’s executives describe Avastin’s pricing methodology as value-based; according to William M. Burns, the chief executive of Roche’s pharmaceutical division and a member of Genentech’s board; “”The pressure on society to use strong and good products is there.” And this pressure allows/enables pharma companies to charge what they want, knowing payers will face incredible pressure to cover the cost.
In contrast, or perhaps contradiction of Burns’ position, Dr. Desmond-Hellmann, the Genentech product development chief, was quoted in the Times as saying “I don’t think any patient should go without a Genentech drug for an inability to pay,” she said. “If this is about money, that would disturb me.”
(I can see the PR types at Genentech cringing…)
Avastin, with annual treatment costs around $100,000, provides about $7 billion in revenues for the company annually.
It is about money – who gets it and who pays it. And therefore it is about choices. Remember a significant portion of medical expense is for treatment of people in their last six months of life. Are we as a society willing to pay $40,000 for five more months of life for people with this horrible disease?
What does this mean for you?
More tough thinking and very uncomfortable debate.
Insight, analysis & opinion from Joe Paduda