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The Cost of Living


In response to the Blood editorial, Novartis issued a statement saying that sustainability of the health-care system is a “complex topic” and that the company’s “critical role … is to discover and develop innovative treatments.” Novartis also noted its “patient access programs,” which help patients cover the high cost of their medications. Many pharmaceutical companies have such patient-assistance programs. Economists like Bach consider these programs a form of artificial price supports that allow the companies to keep overall prices high.

It was precisely these financial issues that led to a little literary tiff between Kantarjian and Silver over the wording of the Blood editorial. Kantarjian insisted that the high prices of CML drugs were forcing doctors to violate the Hippocratic oath (“First, do no harm”). Silver disagreed.

“I thought using the Hippocratic oath was inappropriate,” Silver says, so he told Kantarjian: “Hippocrates meant ‘Do no harm’ from a medical point of view.” Kantarjian replied, “If you kill a patient financially, that counts too.”

Kantarjian has brought a rhetoric to the price debate that is unusual for such a prominent figure in oncology. He accuses the pharmaceutical industry of “greed” in its pricing of CML drugs, argues that “there is zero correlation—zero—between how effective a drug is and the cost of the drug,” and becomes especially indignant when pharmaceutical-industry spokespeople suggest that any effort to contain drug prices will curtail innovation, calling it a form of “blackmailing” against the national interest. He’s pretty exasperated with his fellow oncologists, too. “In the last decade, we have become glorified employees of the drug companies,” he says.

Since the Blood editorial, Kantarjian has begun to talk to other disgruntled physicians, including a doctor concerned about the price of a new drug for a blood disorder called paroxysmal nocturnal hemoglobinuria (which costs a staggering $523,000 a year) and a pair of cystic-fibrosis physicians who published an editorial in the Journal of the American Medical Association on October 2 lamenting the $311,000-a-year cost of a “personalized medicine” drug for the disorder. Kantarjian, meanwhile, is trying to spread his “cut the price” gospel. He’s going to be speaking to a group of health-care executives at the end of October in Chicago and wants to enlist oncologists who specialize in the skin cancer melanoma. Yervoy now costs about $39,000 a month, and a promising new class of drugs called PD-1 inhibitors, currently in advanced testing, is expected to cost even more. (“I mean, why not?” Bach says. “No one is going to stop them.”) “We’ve come to an intolerable situation,” says Kantarjian.

Fueled by his concern for both patients and the health-care system, he is helping to organize a meeting in Washington, D.C., in December of what he calls “stakeholders” in the drug-price debate—doctors, patients, health insurers, federal regulators, and, of course, the drug companies—to “begin the dialogue” about high drug prices; the Leukemia & Lymphoma Society is planning a similar initiative. Kantarjian favors the creation of a governmental “value-based system” to set drug prices on the basis of medical benefit. “New drugs should be evaluated by a committee of experts,” he says, “who can say, ‘This is how much it improves survival, and this is how much the price should be.’ ”

Such a committee already exists in England. Its technical name is the National Institute for Health and Clinical Excellence, or NICE, and it considers not only the benefit but also the cost in deciding what drugs will be covered by the U.K.’s National Health Service. Its decisions allow an implicit form of government negotiating over the price of drugs, because when NICE has turned down a drug as having too little clinical bang for the buck, companies have often come back to the panel with a lower price.

As a result, a British cancer patient usually pays substantially less than American patients. Gleevec costs about $33,500 a year in England, according to NICE; the U.S. price ranges up to $92,000 (according to the Blood editorial). Tasigna, a newer CML drug, costs about $51,000 in England, while the U.S. price ranges up to $115,000. Sprycel, another new CML drug, costs nearly $49,000 a year in England, while the U.S. price ranges up to $123,000.

More to the point, NICE has recently said no where Medicare has been forced to say yes. In January 2012, NICE declined to approve Avastin for both colon and breast cancer, and last June, NICE reached the same conclusion about Zaltrap as Sloan-Kettering’s physicians—it declined to cover the use of the drug, considering it too expensive.

“One of my many politically incorrect opinions,” Saltz says, “is that NICE is an undesirable but necessary inevitability.” The notion that something like NICE could be imported to this country is anathema to the pharmaceutical industry and a pipe dream to most American health-care economists, but Saltz believes we need to start talking about the price tag.

“There is a number in people’s minds,” he says. “If you say to people, ‘I have a drug that extends life by one day at a billion dollars; shouldn’t we as a society pay for it?,’ I’m pretty confident most people would say no. If I say, ‘I have a drug that extends life by three years at a cost of $1.50,’ I’m pretty confident everybody would say, ‘Of course!’ Somewhere in there is a number, a tipping point, where we say, ‘No, we can’t.’ Right now, we’re unwilling as a society to explore where that point is. And I would argue that we have to. Wherever it may be, we have to find it.”


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