HEALTH NEWS

Competition Doesn't Slow Cancer Drug Price Increases

Written by Bob Curley on November 20, 2017

New research shows the average price increase for cancer drugs has risen 37 percent over 12 years. Research costs and high demand are among the reasons.

cancer pills

Cancer drug prices seem to defy the laws of economics.

They steadily increase regardless of competition, a concluded.

An international team of researchers tracked the average monthly sale prices of 24 injectable anticancer drugs, using price data from the U.S. Centers for Medicare and Medicaid Services.

They took into account factors such as rebates and discounts.

The researchers said they found that over the course of 12 years, the average drug price increased 37 percent and some rose a lot more than others.

For example, the price of the leukemia drug Trisenox (arsenic trioxide) jumped 95 percent while Rituxan (rituximab) increased 85 percent.

The cost of Herceptin, a drug used to treat breast cancer, rose 78 percent.

“The only drug price that decreased with time was ziv-aflibercept (Zaltrap) for metastatic colorectal cancer,” the researchers noted. “The drug was approved in 2012 and launched in the U.S. with a high and controversial price tag of more than $110,000 annually. After a public outcry led by Memorial Sloan Kettering Cancer Center in New York, manufacturer Sanofi immediately cut the price in half.”

By the end of the study in 2017, the cost of Zaltrap had decreased 13 percent.

“We believe that new regulations may be needed to prevent additional increases in drug costs after launch, especially since Medicare is legally prohibited from negotiating drug prices,” the researchers concluded.

Some price increases aren’t surprising

Prices were seemingly unaffected by new supplemental approvals by the Food and Drug Administration (FDA), new off-label indications, or new competition, the researchers found.

“Some drugs had significant price increases over time, so the focus should be on those drugs,” J. Leonard Lichtenfeld, deputy chief medical officer of the American Cancer Society, told Healthline.

In other cases, however, price increases could be attributable to normal inflation, he said.

“I don’t find it particularly unusual that the price of a good or product is increasing over time,” said Lichtenfeld. “I don’t think pharmaceuticals are in a special class.”

Morgan Statt, a health and safety investigator with , told Healthline there are a number of reasons for the increase in the price of anticancer drugs.

They include the cost of developing cancer medications, generally low levels of competition, and rising demand due to increased cancer diagnoses worldwide.

The problem is especially acute in the United States, which has a free-market oriented healthcare system, Statt said.

“It is a war between Big Pharma that the consumer often loses,” according to Statt, who said her family has grappled with the high cost of cancer medications.

“Receiving a cancer diagnosis is devastating in itself, but the financial burden brought on by treatment costs can make the entire situation that much worse,” she said.

Criticisms of the study

Officials at the Pharmaceutical Research and Manufacturers of America (PhRMA) didn’t dispute the price data collected by researchers, but said that the study “relies on flawed methods and draws unsupported conclusions about trends in spending on physician-administered cancer medicines.”

“In fact, cancer medicines are a small and consistent share of healthcare spending where tremendous innovation is occurring,” Holly Campbell, a PhRMA spokeswoman, told Healthline. “The current market-based system is working well to balance cost control, access, and continued progress in treating cancer.”

Campbell said that the study “ignores savings that occur as generic medicines enter the market” and criticized researchers for focusing on what she called a “narrow set of medicines [that] remain a small and consistent share of total spending.”

“[The study] ignores the market for cancer medicines is evolving in ways that will drive continued cost containment as payers implement tools to manage costs more aggressively in the private market,” Campbell said.

Costly but needed

Lichtenfeld said that opinions about drug prices are influenced by the fact that many are expensive to begin with, especially for those with small markets and little competition.

“Some medications target just 1 percent of cancer patients,” a byproduct of the trend toward cancer therapies becoming more targeted, Lichtenfeld noted.

Another factor is mandatory discounting of pharmaceuticals such as is required under the 340B program for Medicaid — costs that manufacturers may pass along to purchasers of non-discounted drugs.

Meanwhile, cancer patients still need drugs they can afford.

“If you know that the financial burden of cancer treatments may be too much to bear, consider asking for assistance from nonprofit groups like the . Faith-based organizations and local charities can also lend a hand in support,” advised Statt. “Another option is to ask your hospital for a payment plan up-front before you start any treatments. This can help you determine the best course of action that will hopefully lessen the burden.”

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