Health and Healthcare

Are Some Cancer Treatments Becoming Too Expensive to Approve?

Jon C. Ogg

Published: August 28, 2018 1:45 pm

Last Updated: January 11, 2020 6:41 pm

The cure for many types of cancer has been a long road. Many treatments exist for cancer, and defining a cure is often not as simple as it may seem. Cancer patients face many issues along the way in their fight against the disease, but one issue that is perhaps the hardest to discuss is the actual cost of treating each patient. This is at a time when the number of $1 million annual claims per patient has grown in recent years.

The Kite Pharma unit of Gilead Sciences Corp. (NASDAQ: GILD) recently received European Commission marketing authorization for its Yescarta treatment for lymphoma. A fresh communication from the National Institute for Health and Care Excellence, the United Kingdom’s state-funded health service, did not follow suit as it denied Gilead’s gene therapy.

In a similar move in the European Union, Novartis A.G. (NYSE: NVS) received European Commission approval for Kymriah in B-cell lymphoma for patients. That said, Reuters pointed out that the gene therapy for blood cancer’s introduction will vary from country to country as Novartis works out payment details and as it builds the manufacturing capacity.

Yescarta is made from a patient’s own white blood cells. Those cells are modified to recognize and attack your lymphoma cells, and it is said to be the first CAR T therapy for adults living with certain types of non-Hodgkin lymphoma who have failed at least two other treatments.

The draft guidance in the United Kingdom suggested that the gene therapy treatment is not sufficiently cost effective. Gilead also has begun discussions with the National Institute for Health and Care Excellence to identify relative treatment comparisons to clarify how its gene therapy may be made available to patients in the United Kingdom.

At issue for Gilead, and for Novartis and other cancer treatments like CAR T, is that sometimes a drug or other treatment may cost too much. Other times the benefits over existing treatments are less clear. Either way, when the total cost of treating a patient runs into the hundreds of thousands of dollars or hits $1 million, it can easily become a sticky situation.

Pointing out the issues around drug costs is nothing new. What often gets missed in the argument is the cost of care in a world where governments, companies offering insurance, insurance companies, health care providers and individuals in need of treatment all must all consider the actual costs of treatment. Novartis’s Kymriah costs roughly $475,000 in the United States. The cost for Yescarta, at the time it was approved in 2017, was said to be $373,000 in the United States.

Now agencies and all the other participants in the health care chain have to consider the total cost of treatment. The total cost is of course higher, and by the time all related patient costs come into play it can rather easily reach $1 million, when adding in hospital visits and when problems arise.

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Discussing costs of medicine versus the outcomes is not without controversy. Even if the outcome is positive, it is far from easy to reach an easy conclusion over the cost and benefits argument.

SunLife recently reported that the number of patients with claims that exceeded $1 million had risen by 87% between 2014 and 2017. The number of cases had skyrocketed prior to 2014 as well. And SunLife’s report showed that, in 2017 alone, four of the five costliest injectable drugs, used to treat cancer or related conditions, led the cost basis for injectables.

The topic of acceptable costs versus acceptable results is one that may never have a final conclusion in which everyone agrees.