Price Controls to Ration Cancer Drugs

I always say: If you want to see where things will go wrong next in society, read the professional journals.

An article published in the Journal of Clinical Oncology advocates that the government set a “just price” for all cancer drugs. From the article (my emphasis):

Finally, we must challenge the status quo that sets drug prices arbitrarily without regard to the real value of a drug.

Assuming the government should have the power to dictate price–a problematic proposal, at best–how to do that? Quality of life!

The value of a new cancer drug should be measured by one of several parameters: one, improving survival or PFS [“progression-free survival”–how long a patient lives before his cancer worsens] (particularly important as an early surrogate end point for indolent tumors); two, improving quality of life; three, reducing/alleviating adverse effects compared with similar approved drugs or reducing toxicities of cancer drugs; and four, reducing cost.

To that end, we propose a value-based system for setting the initial price. Providers, regulators, patients and advocates, representatives of insurance and pharmaceutical companies, and other interested parties should all be involved in the discussion of initial pricing. The benefit quantified for FDA drug approval should be integral to drug pricing .Drug pricing could involve established measures of CE, life-years, or QALYs.

Oh, the bureaucracy!

QALY is “quality adjusted life year,” in which the lives of some patients are given higher value than that of others, in determining whether a treatment is worth the price. It is the kind of rationing engaged in by the NHS:

For most drugs, where tumor regression and prolongation of life are the goals, the amount of time that life is prolonged could be used as a simple measure of efficacy and guide drug pricing. A realistic range might consider a new drug that prolongs survival by more than 6 months or by more than one third of the life expectancy (eg, 12 months becomes 16 months, or 30 months is increased to extremely effective,with pricing at a range of $50,000 to $60,000. Similarly, an agent that improves long-term survival or PFS by 10% or more would fall into that category.

On the other hand, drugs that demonstrate “statistically significant” survival benefits of 2 months or prolong life by less than 15% would be considered to have minimal efficacy and be priced much lower, perhaps below $30,000 per year…Similar measures could be implemented to value quality of life, reduction of toxicities or adverse effects, and cost.

What would be the point of offering lower prices for less efficacious drugs? Rationing by reducing supply.

Dictating low prices for “undesirable” drugs would reduce the incentive to manufacture the medicine, which, in turn, would make it more difficult for patients to access life-extending–but not curative–chemotherapy. In other words, you might have the right to receive the treatment that extended your life 6 months–but not the ability–because the cupboards would be bare. 

The Medical Establishment has gone all in for establishing a top-down bureaucratic technocracy with the power to dictate approaches and prices throughout the health care system. This is what Obamacare hath wrought.

Wesley J. Smith — Wesley J. Smith is a senior fellow at the Discovery Institute’s Center on Human Exceptionalism.

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