With targeted cancer drugs, cost vs. benefits gets more complicated

NICE rejection of gene-targeted drug Zelboraf goes to heart of issue
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The refusal by NICE on Friday to recommend that the U.K. health system buy Roche's ($RHHBY) melanoma drug Zelboraf illustrates why the debate over expensive end-of-life cancer drugs is not going to die.

The National Institute for Health and Clinical Excellence says the benefits were too uncertain for a cost of £1,750 ($2,700) to extend a life for a short time, Reuters reports. With that, the agency has now rejected 9 of the 10 end-of-life drugs it has reviewed. The rejection of a therapy whose chance of success is boosted by its genetic targeting goes to the heart of that discussion.

The question of cost versus benefits, particularly very high costs for very short life-expectancy times, is being played out in many countries, including the U.S. Reuters points out that at the recent American Society of Clinical Oncology (ASCO) meeting 44 studies looked at cost effectiveness, twice as many as in 2005.

The cost of giving cancer drugs is projected to rise 20% a year, reaching $173 million in the U.S. by 2020. The annual cost of treatment could top $100,000 a year when cancer drugs are combined. This is leading payers and patients, some of whom can't justify the costs to themselves, to look for some alternatives. Some are testing reimbursement models that bundle costs for overall patient care or ask patients to pay more out-of-pocket if they choose a treatment with a limited chance of success, Reuters says.

Some of the gene-targeting therapies let doctors know when those chances are good in specific patients, which some say is the way to go. That means patients and payers don't ante up for a therapy that is unlikely to succeed and drug companies can continue to have some expectation that their innovation will be valued. NICE apparently doesn't agree.

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