The Cost of Hope Against Cancer

An interesting editorial appeared in the Atlantic which starts of with the catchy tag: "If I lived in New Zealand. I'd be dead."

The gist of the article speaks about the authors use of the cancer drug, Herceptin, which along with chemotherapy had remarkable effectiveness in treating her breast cancer. The cost of the drug was $60,000, paid by the author's health insurer. If you ask the author, it was worth every penny.

Cancer drugs, like other pharmaceuticals are not inexpensive, and while I could go on about the economics of why drug therapies are required to recoup the massive amounts spent in research and development where the vast majority of compounds fail, I won't do that here. What I find particularly interesting is the complex debate around whether the state should determine which drugs should be made available or affordable to its citizens, even when the use of those drugs may cause economic hardship for the rest of the population and extend life for only a handful of months. Put another way, you may say that life is priceless and no expense should be spared to prolong yours, but should the rest of the population pay the price for that? Is the rest of the population willing to pay the price for that?

The editorial pointed out that in many countries, through the use of a national healtcare system, determine which drugs are worth the cost to the population. New Zealand is one of these countries, and through its Pharmac agency, has "successfully" decreased cost of overall drug coverage per capita to $303 per person, compared to $843 per person in the United States. There is a price to be paid, as that $303 limits what you get. So while an insured patient would get $60,000 worth of cancer wonder drug with a small co-pay in the United States, a patient in New Zealand would be told essentially, "Sure you can get it. Go ahead and make out a check to Genentech for $60,000."

If you're a cancer patient in New Zealand, suddenly the downside of nationalized healthcare hits you in the face. President Obama talks about independent reviews and research on comparative effectiveness which will scrutinize new treatments for effectiveness, which sounds great in theory, but at the end of the day you end of results like you see in New Zealand.

Don't get me wrong, that's not all a bad thing. I'm not being rhetorical when I ask whether it's a good thing for a society (via the healthcare system where premiums will be raised for everyone) to bear the burden of billions of healthcare cost dollars (around $18 billion to be exact) to, in many cases, increase cancer patients lives less than a year longer. It's understandable that your answer will be different if you or a loved one is a cancer patient.

An excellent article some months ago in the New York Times talked about the dilemma that cancer drugs posed in terms of costs versus benefit. No less an authority than legendary Merck CEO Roy Vagelos made a thinly veiled reference to a cancer drug, Avastin, that costs $50,000 a year and adds four months of life. “There is a shocking disparity between value and price,” he said, “and it’s not sustainable.”

But even that's a judgment call, and who is going to make that call? Are you going to ask doctors to look in the eyes of a patient and tell them, "I want you to have hope in your fight against Stage 4 colon cancer, but I'm not going to prescribe you the best drug out there because that sort of hope is too expensive. Good luck." Do you really want managed care organizations and insurance companies to make that call? The government, as it does in New Zealand?

We can all agree that cancer is horrible disease, and that the quest to eradicate it is a worthy one. It's going to be costly to do so, however, and the economics around developing the next generation of cancer therapies is complex. My hope is that the battle can be won sooner than later, until no patient will get caught in the crossfire in the debate around the cost and benefits of these drugs.