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08/10/2018

Mumbling orphans—a bit more

Mark McQuain has raised the persistent, vexing issue of the pricing of drugs for rare diseases—in the case at hand, Sarepta’s eteplirsen (Exondys 51) for Duchenne Muscular Dystrophy, the disease over which the late comedian Jerry Lewis lost sleep every Labor Day weekend for years.

Mark provided an excellent summary (he calls it “crude,” but it’s anything but that).  In this case, the concern is not just price for a truly rare disease, but whether the drug showed sufficient evidence that it worked for FDA to approve it.  In the absence of alternative treatments, that was the truly tempestuous issue for Sarepta.  (Recall that under the 1962 Kefauver-Harris amendments to the Federal Food, Drug, and Cosmetic act, drug manufacturers in the U.S. may not sell a drug unless the FDA finds it not only safe, but effective—a standard that generally applies worldwide.)  It’s one thing for a drug to have a high price, but rather another if it doesn’t work, or doesn’t work very well.  (I decline to comment publicly about the Sarepta data; outside my expertise.  Those seeking a case in point may wish to consider Avastin for breast cancer.)

And to be sure the high price concern dogs other treatments that appear to work quite well—such as high-profile ones for cystic fibrosis or for cancer.  A case can be made that such drugs are worth the price, that too much government heavy-handedness risks stifling innovation, and that a search for the “just price” is misguided, but also, for sure, that society should share the costs of some of these drugs, that measures should be taken to limit out-of-pocket costs to disease sufferers, and that reimbursement approaches are ripe for overhaul.  In that last bucket: if drugs work only some of the time, only pay for the cases in which they do work; foster true competition (rather than having the costs of all drugs in a class go up when a new one is introduced, as if drugs were houses); eliminate the middle man (i.e., pharmacy-benefit managers that take a cut—that appears on the horizon); and the “biggie,” having government payers push back harder on prices.  At least some of these measures seem likely, and at least some seem warranted.

But overall, high costs for truly innovative treatments are justifiable, where no alternatives existed previously and especially when other, more expensive and quite possibly less effective medical treatments may be obviated (see: drug treatment for hepatitis C vs liver transplantation).  This is not to endorse price gouging for existent, cheap drugs that fall into an incidental monopoly (in which case, BTW, elimination of said monopoly, through regulatory facilitation of alternative sources, is warranted).

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