Category Archives: pharmacoeconomics

Thought provoking blog on high priced new drugs

I just read a thought provoking blog on high priced new drugs. The author, a hospital pharmacist, is faced with the issue of how her institution can afford to treat patients with a new drug that promises profound increases in quality of life, but at astronomical prices.

The blog is available at:
http://connect.ashp.org/blogs/ashley-overy/2017/01/06/at-what-cost

(Note – I am not personally endorsing or failing to endorse the Campaign for Sustainable Rx Pricing that Dr. Duty mentions in her blog.  I don’t know enough about the organization to have an opinion one way or the other.)

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New drugs for Hepatitis-C – Cost-effective but too costly?

Until a few years ago, people infected with the Hepatitis-C virus (HCV) were in a bad way.  Treatments were available, but they included interferon which had nasty side effects.  Most patients experienced fatigue, headache, and muscle aches. A third or more had nausea, fever, depression, irritability and insomnia.  Even worse, cure rates averaged under 60%.

But then there was a major clinical breakthrough.  Gilead Sciences introduced a new drug –Sovaldi (sofosbuvir) – that provided cure rates of 95%.  While most patients had to take Sovaldi with interferon, many could be treated with an interferon-free regimen that avoided most side effects.  A year or so later Gilead introduced an improved product – Harvoni – that consisted of sofosbuvir and ledipasvir.  With Harvoni almost all HCV could be cured by a single 12-week, interferon-free regimen.  What a drug – ultra-high cure rates and minimal side effects.

But, as with most things in life, there was a down side.  The drugs are expensive.  The list price for the recommended 12-week treatment is $84,000 for Sovaldi or $94,500 for Harvoni.

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DrugAbacus – a tool for estimating the value of cancer drugs

Do cancer drugs provide good value or are they overpriced?  Last week’s post discussed the value framework introduced by ASCO for evaluating the value of cancer drugs.  This week we will look at another approach to estimating  the value of cancer drugs – the DrugAbacus interactive tool  developed by Sloan Memorial Kettering Cancer Center.    According to a recent Wall Street Journal article, Dr. Peter Bach developed DrugAbacus “to get drug makers, insurers, doctors and patients talking about the factors that should determine price” and to develop “a value-driven system for pricing cancer drugs”.  A screenshot of the tool is shown below.

drugabacus screenshot

 

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ASCO releases value framework for assessing value of cancer drugs

It’s no surprise that costs of cancer drugs are high.  Recent estimates put the average cost of cancer drugs at $10,000 per month with some therapies costing as much as $65,000 per month.  If it weren’t for insurance, prices this high would put cancer drug therapy out of reach for most families.  Even with insurance, many families cannot afford cancer drugs because of high patient cost sharing.  Many insurance programs, such as the Medicare Part D program, set patient cost sharing as a percentage of the drug’s cost (usually in the 20% to 30% range) rather than as a fixed dollar amount.  Medicare Part B, which covers most injectable cancer drugs, has a patient cost share of 20%.  How many families can afford cost sharing of $2,000 to $3,000 per month?

Oncologists and their professional organizations are concerned about this and have taken steps to address the problem.   The WSJ  recently reported that Memorial Sloan Kettering Cancer Center has developed an on-line, interactive tool to help physicians and patients determine what cancer drugs are worth.  I will discuss this tool in next week’s post.  Today’s post will discuss a value framework for assessing the value of cancer drugs that was recently announced by the American Society of Clinical Oncology (ASCO),  the professional organization representing oncologists.

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