How do we define the “value” of novel therapies now available to treat Americans living with cancer, HIV, hepatitis C, and other life-threatening diseases? Quoting from Miles’s Law, coined by Princeton University Professor Rufus E. Miles, Jr., “where you stand depends on where you sit.”
If one “sits” on the side of cost containment as health plans and some providers do, value is simply about the price of new medicines – not the long-term impact on patients’ lives and the economy. Thus, insurers rail about the high costs of new hepatitis C treatments that have cure rates as high as 95 percent. In contrast, untreated hepatitis C can lead to serious liver damage and the likelihood of a liver transplant costing as much as $500,000.
Yet, here is what happens in the U.K. when the National Institute for Health and Clinical Excellence assesses the value of novel therapies. Applying a cost effectiveness threshold to all new medicines, NICE initially restricted access to the lifesaving drug Gleevec and recently rejected coverage of a breakthrough therapy for lung cancer called crizotinib, despite evidence of substantial survival gains. Unfortunately, these cost saving measures come at a human price: According to a 2012 study in Health Affairs, U.S. cancer patients survive approximately two years longer than those in the U.K. and Europe.
Rather than these restrictive approaches, the Alliance for the Adoption of Innovations in Medicine (Aimed Alliance) believes Americans are better served through policies that define the value of new therapies in patient terms, not upfront costs. This means assessing novel therapies on the basis of improved longevity, productivity, and quality of life where the payoff can be substantial.
Consider cancer where new treatments have contributed to a 30% drop in cancer deaths over the last two decades, making it possible for patients to experience 50 million additional years of life and generate $4.7 trillion in economic activity. Also of note, a Cornell University study finds when longevity, quality of life, and the greater efficacy of today’s treatments are considered, the cost of cancer medicines is 30% less than a decade ago.
These savings require greater access to new therapies, which means removing onerous insurance roadblocks, such as health plans putting novel therapies on the highest (“specialty”) tier and forcing patients to pay a large percentage of the drug’s price. According to a new Leukemia & Lymphoma Society report, even the new state exchange plans for previously uninsured patients use this cost containment strategy. This means patients can pay up to 50% of the costs of new cancer therapies, which few can afford.
Given that restricting access harms patients, 15 states and the District of Columbia are taking action, including Delaware, Maryland, and Louisiana, which passed laws capping co-pays on specialty medicines. Yet, if the real value of novel therapies is to be realized, we need more patient protections at the state and federal levels. Instead of a petition to impose more cost containment policies, now is the time for a petition to increase patient access to novel therapies through legislative and regulatory remedies.
Worthy is policy director of the Alliance for the Adoption of Innovations in Medicine.