Cancer drug costs outpacing innovation? [VIDEO]
"We're in a situation where a cancer diagnosis is one of the leading causes of personal bankruptcy."
~Dr. Leonard Saltz, Chief of Gastrointestinal Oncology at Memorial Sloan Kettering
In a recent 60 Minutes segment, Lesley Stahl identifies many key challenges that are keeping cancer drug costs prohibitively expensive for the Middle Class. Here are a few highlights and the full video segment is below:
- A single drug therapy may cost well over $100,000/year for a family
- Drug companies report that it costs over $1 Billion to bring a new drug to market. This is referred to as the "cost of innovation"
- Middle Class families struggle to cover high insurance co-pays to the point where many are taking half-dose regimens instead of full regimens
- Newer drugs like Zaltrap ($11,000/month) cost over twice as much as previous drugs on market like Avastin ($5,000). And yet in clinical trials, when given as part of chemotherapy, Zaltrap has extended median patient survival by only 42 days over Avastin. That's lame.
- The single biggest source of income for private-practice oncologists is the Medicare margin earned from cancer drug prescriptions. The average Medicare margin oncologists earn is 6%, which naturally incentivizes prescriptions of higher priced drugs vs. lower priced drugs, regardless of efficacy.
The Zaltrap findings are shocking. If it takes $1 Billion to get a new drug to market, and the majority of these "costs of innovation" are passed onto the Middle Class, we are on a collision course to nowhere. The silver lining of this collision is that it will likely force the hands of Congress, innovators, and consumers to take even more proactive, cost-effective steps in the future...hopefully it won't come too late.