A recurring question facing health officials is how to best use the money they receive from taxpayers. Buying medicines that cure everyone would be the obvious answer in an ideal world, but the reality in hospitals is much more complex: there are no effective therapies for all ailments, new treatments are very expensive, and budgets are always stretched. limit. So the best management is to spend on what brings more value to the population in terms of health, that is, on drugs that give more years of life, allow them to be enjoyed with greater well-being and cover unmet medical needs.
A new investigation, carried out by experts from the Memorial Sloan Kettering Cancer Center in New York and the University of Zurich, has found an added obstacle to this difficult equation: “the premium” or “premium” of cancer (“the cancer premium”). “, in English). “New cancer drugs are systematically up to three times more expensive than those for other diseases, even when comparing drugs with equivalent efficacy indicated for pathologies with similar incidences and mortality. It is a difference that is not explained by these variables or by higher research and development costs”, explains Miquel Serra, co-author of the paper and researcher in Health Economics and Epidemiology at the Swiss university. The work has been published by the scientific journal eClinicalMedicine.
Miquel Serra, in the library of the University of Zurich.
The authors have discovered that this premium is practically universal, since they have observed it in the three countries analysed, representative of the three most common pharmaceutical policies: the United States, where there is no public healthcare system and companies are free to set prices; Germany, whose public health initially agrees to pay what the companies ask for and renegotiates it after a year according to the results obtained; and Switzerland, where this evaluation is done before the drugs are incorporated into public health.
This is a system similar to the one existing in Spain, a country that usually negotiates somewhat lower prices than northern European countries but where the differences between oncological and non-oncological treatments remain, according to all the experts consulted. The reason is that the discounts are applied to a very similar official public price throughout the continent.
“The discovery of the cancer cousin is one of the great contributions of the study. Regulatory differences explain why prices are much higher in the United States, slightly higher in Germany, and lower in Switzerland. But cancer treatments continue to be much more expensive in all cases”, highlights Beatriz González López-Valcárcel, professor of Economics at the University of Las Palmas de Gran Canaria.
This fact, according to the researchers, has important consequences for equity in access to treatment and the sustainability of health systems at a time when drug prices are experiencing a significant upward spiral. A study by the Ministry of Health reveals that the bill paid by hospitals for cancer treatments has increased by 94% in Spain in just five years (2016 to 2021).
“The premium alters the logic of efficiency in health systems. The objective is to allocate resources where they offer more health to the population. But if cancer treatments require triple the money to achieve the same results, other areas may be left behind. The risk is that the result is a loss of health of the general population due to an inefficient allocation of available resources”, reflects Serra.
“A very important message of the article is that it highlights the component of social injustice that multiplies the price of some treatments, because in a context of pressures for sustainability, this implies subtracting it from other equally important diseases,” adds González López- Valcárcel.
The researchers have analyzed a total of 181 drugs launched by the pharmaceutical industry in recent years, of which 68 (37.5%) were oncological. Of these, 177 were present on the US market, 116 in Germany and 93 in Switzerland. The first evidence is the large price differences in the three countries. The average price of the new treatments is 45,000 euros in Switzerland, 58,000 in Germany (28.9% more) and almost 92,000 euros in the US (104.4% more).
The second piece of evidence, and the one on which the researchers focus their work, is the great increase in the cost of the new drugs that have come onto the market in the last decade, a process that, except in Germany, has been more pronounced among cancer patients. Thus, in the United States the price of new treatments for other diseases has gone from an average of 24,000 euros in 2011 to 63,000 in 2020, with an average annual increase of 17.6%. Oncology, on the other hand, have shot up 31% annually, going from 47,000 euros per drug to 180,000.
In Germany, new non-oncological drugs have risen in the same years from 22,000 to 38,000 euros (7.9% per year), while those dedicated to cancer from 46,000 to 66,000 euros (4.8% per year). And in Switzerland these increases have been 3% per year (22,000 to 28,000 euros in the decade) and 8.1% (40,000 to 69,000 euros), respectively.
These data mean that the “cancer premium” amounted to 68,000 euros per treatment in the United States, 34,500 in Germany and 30,000 in Switzerland if an average is made of all the drugs launched in the last decade.
Pricing policy
The first reason for these differences is the pricing policies of the pharmaceutical industry. “The industry argues that high prices are due to higher cancer research and development costs, but there is plenty of scientific evidence to show that drug prices are not related to cost . In addition, it does not take into account that a good part of the first phases of drug development is carried out with public financing”, says Jaime Espín, professor of Health Economics at the Andalusian School of Public Health and former adviser to the World Health Organization (WHO), the World Bank and the European Commission on drug pricing policies.
Kerstin Vokinger, co-author of the article and professor at the University of Zurich, focuses on the reasons that lead health systems to accept these higher prices. “Higher prices for cancer drugs may reflect higher public awareness and fear of oncological disorders compared to non-cancerous diseases,” she explains.
This social willingness, more than research and development costs or the effectiveness of treatments, is the key variable that experts attribute to the existence of the premium. A position that is maintained despite the fact that several studies have shown that less than half of the approved cancer treatments provide a high therapeutic value and allow the patient to improve survival or increase the quality of life.
Serra and Vokinger have participated in another study, recently published in The BMJ, which concludes that only 41% of new cancer treatments approved by the US Drug Agency (FDA) provide substantial therapeutic value, a percentage that in the case of European Union (the EMA) increases to 47%. These percentages are very similar to those found in Spain by a team of Hospital Pharmacy specialists who, after analyzing the cancer treatments approved since 2010, concluded that only 43.7% increase patient survival and 49.8% provide a substantial therapeutic value.
When the approval is for a second indication —for example, a therapy against one type of breast cancer can also be used against another kind of tumor in another organ— the high therapeutic value achieved drops to 34% and 36%, respectively.
“The fact that the effectiveness decreases in the second and third indications has important implications for health systems. Firstly, because the trend is for there to be more and more approved indications for the same treatment (more than a dozen, in some cases). But the price is the same for all of them and this can attract resources to less efficient therapeutic options”, says Vokinger.
The strict evaluation of the therapeutic value of each drug and indication is the formula used by public health systems to decide which treatments are worth financing. Germany opens the door to all therapies at the time they are approved by the EMA and a year later reviews their effectiveness. If this is less than that observed in the tests, ask the company for a price reduction if you want to continue selling them to public health. Although it also provides for mechanisms to exclude those indications with less effectiveness from financing, the problem remains that they will all continue to have the same price regardless of the therapeutic value provided.
“It is a dilemma that is also faced by countries that carry out a prior evaluation before incorporating a drug into public health, such as Spain, France and Switzerland. The high prices make it necessary to be very strict and finance only those indications with greater effectiveness, which is still a problem because it means removing therapeutic options from the public system that in some cases could be useful. A possible solution with current information systems would be to set a price per indication, higher for those that are most effective and lower for those that are less effective. In Spain, this is something that the current Medicines Law does not allow, but now that its reform is under study, it could be considered”, says Espín.
The employers’ association Farmaindustria also considers that it would be positive to approve more than one price for the same drug according to the proven effectiveness, since this would allow “reflecting the differences in added value in the different indications”.
In some cases, the laws and practice of the health systems already contemplate that greater resources are allocated —even when there is significant uncertainty about their effectiveness— to some pathologies. This is what happens with types of cancer and rare diseases with a very low incidence and few available treatments. Investing more in them is a way of encouraging research and not leaving these patients with virtually no therapeutic option. “This may explain this premium in some cases, but the study reveals that it is also applied systematically to all anticancer drugs, even those in which there are many therapeutic alternatives and are tumors with a high incidence among the population,” says González. Lopez-Valcarcel.
The experts point out two points to take into account when assessing this type of study. “They provide very valuable information, but they have some limitations. The first is that they are made with the official prices of drugs, which is what is made public. But then healthcare systems sign confidential discounts with the companies, so the actual price may be lower and so may the inefficiencies they cause. The second is that many public hospitals buy in volume, with additional discounts if they buy more treatments. In some cases, this may mean that purchasing them for second indications, even if they are less effective, may be advantageous because it lowers the average purchase price. This is something we know is happening, but unfortunately we cannot know the details of it due to the confidentiality of the contracts”, concludes Jaime Espín.
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