The Cost Of Cancer Drugs Is Too Damn High!

All quotes in this are from Stephen S. Hall’s excellent “The Cost of Living” (New York, October 28, 2013).

I am probably jinxing myself for saying this, but unless I am independently wealthy to the point at which I have vast sums of money to burn, if I get some sort of horrible, uncurable disease which I can only prolong through financially crippling medication costs, let me die. Otherwise, what’s the point of surviving, if it bankrupts me and forces me onto the street, a quality of life that I wouldn’t wish on my worst enemy? And I know this brings me close to “death panel” territory, but what’s the point of living for another month, intubated or irradiated, weak and feeble, if I’m still going die? You can’t put a price on life, and yet pharmaceutical companies do, trusting that either insurances will be forced to help cover $600K/year costs, or knowing that their patients/customers don’t really have any other choice. As health-care-policy analyst Peter Bach tells Stephen S. Hall:

What predicts the price of the next cancer drug is the price of the last cancer drug. The only check on the system is corporate chutzpah.

It’d be one thing if these drugs were at least independently effective, but Leonard Saltz, head of gastrointestinal oncology at Memorial Sloan-Kettering Cancer Center, acknowledges that pharmaceutical costs, already high on their own, don’t factor in other stuff:

It’s parts, not labor. No money for doctors; no money for nurses; no money for pharmacists; no money for real estate, heat, and lights; no money for the needles, the IV tubing, the IV fluids, the anti-nausea medicines, the other chemotherapies that are given, because Avastin [one particular drug, used as a stand-in for many other similar products] doesn’t do anything by itself.

Nobody’s denying the fact that major corporations do spend billions on R&D and deserve to make some profit on their investment (or at least enough to break even, considering all the failed investments along the way–much like big movie studios rely on tentpoles to finance their smaller work); the argument here is that “the rise in prices, according to cancer doctors, has far exceeded the drugs’ effectiveness.” If a drug truly provides value and addresses unmet patient needs, great, but Hall’s essay implies that there’s little difference between Avastin and Zaltrap, save for the price (the latter is twice as expensive). For stat wonks, Saltz shows some erratic inflation, too: “the median survival rate had increased twofold, to 22 months [by 2004], but drug costs had increased hundreds of times.” Maybe we do need to set a value on life, at least from a medical perspective, so that prices are brought under control. If the average day of a person’s life is equal to x, then the maximum cost–and the market can then undercut for competitive purposes–must be no higher than xy, where represents the median number of days the drug alone (a percentage of y, depending on its contribution to overall recovery) extends your life.

This is a terribly callous way to look at things, I know, but the only other alternative is to do away with health insurance and let the market actually be set by what ordinary people can actually pay. After all, it’s doubtful that companies will respond by catering only to the very rich–at least, not any more than they already do, with private amenities and top-tier responses. (This is similar to my theories on rent prices in areas, like New York City, that have stabilization laws that prevent the market from behaving realistically.) This might not do away with the current practice in which companies, according to Saltz, “strategize for large-scale clinical trials that look for small, incremental gains that will get a drug to market, than to swing for the fences and try for the big advance,” but it would at least force pricing to more accurately represent those small gains–a new drug that does away with a single side-effect, then, wouldn’t be getting billed with a hundred percent markup.

There are other issues with the rampant out-of-control costs of the market, too, such as the lack of information on the patient’s end, and the fact that nobody wants to be as stingy shopping for healthcare options as they are, say, shopping for a new smart phone. But I can’t read something about the “byzantine economics of health care” and not be insanely enraged:

Markets that don’t behave the way “real world” markets do; artificial price supports that are called something else; government regulations that remove any downward pressures on pricing; and, until Medicare reforms kicked in, in 2005, arcane reimbursement policies that actually rewarded oncologists who used higher-priced drugs, because it would increase the profit margins of their practices.

This, incidentally, is why you argue for universal healthcare–so as to take (or limit) the feckless profiteering of certain people in the medical profession, instead creating fair benchmarks for the industry (such that the cost of similar surgeries at hospitals within miles of each other do not differ by thousands of dollars). But then again, I’m not a doctor, or a corporate researcher, and I’m sure I’m letting emotions blind me to some clear counterarguments: so bring those on, if you can. Explain to me why, as Bach states:

Medicare–and most private insurers, who want to do business in most states–have to include every drug in coverage. And they have to pay the producer’s price. It’s kind of that simple.

I thought the point of having large collective insurers was to allow them to bargain for better prices based on volume, similar to what Wal-Mart does when it demands lower prices from suppliers, if they wish their goods to appear in stores. Hall’s article begins with the example of Sloan-Kettering refusing to stock a drug that’s too highly expensive, and acknowledging that this doesn’t happen more frequently because of the public outcry over “rationing” health care, but that’s not rational. (Then again, what counterarguments to, say, Obamacare, have been rational?)

In any case, this has rambled all over the place; I advise you to read Hall’s cogent bit of reporting for yourself–if nothing else, it further demonstrates that we need to openly have a discussion about the value of medicine/insurance . . . or we’re going to lose any chance we have at actually having some quality of  life. No longer can we hear of rising prices, like those Hagop Kantarjian (head of the Department of Leukemia at the University of Texas’s MD Anderson) points out occurred with Gleevec simply because “nobody could do anything about it.” Again, nobody’s arguing that Gleevec’s a bad drug, or that the company producing it doesn’t deserve to make money–but they were charging around $30,000 in 2001 and by 2012 has gotten the price up to $92,000, which cannot be described as anything other than profiteering. And before you argue that that’s really only affecting the insurance companies who have to cover this, don’t forget that their responses are simply to pass the buck on to their healthier clients, with ever-increasing premiums. At some point, “rationing,” by whatever name you call it, needs to be considered–saying that “if you kill a patient financially, that counts as a violation of the Hippocratic oath, too” works for both sides of the argument, after all.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Create a free website or blog at

%d bloggers like this: