As Cancer Drugs' Prices Skyrocket, Experts Worry About Burden On Patients, Health Systems

This week we're examining fast-moving changes in cancer research and treatment in a series we're calling, "This Moment In Cancer."

Leaders in cancer research say the field has reached a pivotal moment, including the discovery of new treatments. But, these new treatments come with a price tag that many experts believe is unsustainable.

Richard Knox joined Morning Edition to discuss the rising costs associated with cancer drugs. Below is a transcription of our conversation with him.

Richard Knox: New cancer drugs are being approved at a fast pace: dozens a year. And many more are in the pipeline. In the past, these drugs might cost around $10,000 for a year’s treatment. But one recent study found newly-approved cancer drugs carry price tags between $120,000 and $170,000.

Bob Oakes: What's behind this enormous increase?

Knox: It’s complicated, and drug companies don’t reveal what goes into their pricing decisions. But one factor is a 2003 federal law that bars Medicare from negotiating over drug prices. And Medicare Part D — the drug benefit which went into effect 11 years ago — requires Medicare to pay for all approved drugs. Taken together, this means drug companies can charge whatever they want.

Oakes: Big picture, Dick, what are the implications of this trend?

Knox: They’re big – for the health care system and for cancer patients and their families.

One recent study looked at what’s happened with just one treatment for a blood cancer called CLL. Last year, the FDA approved a two-drug combination that’s revolutionized the treatment of CLL. Newly-diagnosed patients on this regimen can now expect to live seven years, and often much longer. And side effects are greatly reduced. But the price tag for each drug is about $130,000, and patients need to take them for the rest of their lives.

Jagpreet Chhatwal of Mass General Hospital, who led the study, tells me the new treatment has tripled the cost of treating a patient with this one type of cancer.

Chhatwal: We find that on average the lifetime cost of treatment with these new therapies would be $600,000.

Knox: And because patients will live much longer, the total number of patients with CLL — all needing lifetime treatment — is rising rapidly. So the total cost burden for the health care system is soaring too.

Oakes: What about the implications for patients?

Knox: Chhatwal says the out-of-pocket costs for patients has gone up even faster.

Chhatwal: That cost is substantial, it's more than $50,000. And if you compare treatments with previous therapies, out-of-pocket cost was around $10,000. So we're talking about a 500 percent increase in out-of-pocket cost of treatment.

Knox: And keep in mind, Bob, that this is just one cancer among at least 200 different types, many of which are being treated with more effective — but more expensive — new drugs.

Chhatwal: We think this is just the tip of the iceberg. The trend is very disturbing.

Knox: It’s a trend that could affect almost every family. Two out of every five Americans will get a cancer diagnosis at some point in their lives.

Oakes: Are skyrocketing drug costs preventing some people from getting potentially life-saving cancer treatment?

Knox: Probably. But, Bob, that’s hard to pin down. People at leading cancer centers tell me they’re able to find a way to treat nearly everybody, so far. But Dr. Otis Brawley, the medical director of the American Cancer Society, tells me that many people don’t ever make it to a leading center.

Brawley: I actually know people who have decided to forego a treatment, because they cannot afford it. And I'm sure there are people who are giving up the option for a cure, because they can't afford it right now. It's just incredibly shameful that this would happen in the United States.

Oakes: That's horrible, Dick. Is there anything that can be done about it?

Knox: That’s not clear, Bob. You may have noticed that our new president declared recently that he was going to demand that drug companies negotiate prices. That would take a change in federal law, at least to allow Medicare to negotiate — and most cancer patients are on Medicare. Drug companies will surely fight that. And then there’s the expected repeal of the Affordable Care Act. Will its replacement will address skyrocketing drug costs, or put the cost of cancer treatment further out of reach? Nobody knows.