Don’t Just Shrug

So often, especially on TV, a news story can go flashing by so fast that we hear the main point and don’t pay much attention to the rest and don't think too much about implications. Before we know it, they've moved on.

Last week the news came out with such a story, that the FDA has approved an exciting new cancer drug. According to an NBC report: “While several drugs are approved to treat a variety of different cancers based on genetic mutations, Vitrakvi, known generically as larotrectinib, is the first that is approved from the beginning to treat cancers solely based on the mutation.” Instead of being approved to treat specific cancers that arise in certain parts of the body, Vitrakvi goes after the genetic characteristic of a cancer arising anywhere in the body. Although it doesn’t work for all types of cancer, this appears to be a significant breakthrough.

But there is a huge downside. In the sub-headline NBC mentions that the wholesale cost is expected to be $393,000 a year.

Another website discussed the cost in a little more detail. “The wholesale cost for the children's syrup is $11,000 for a month's supply and the oral capsules for adults wholesales for $32,000 per month. With insurance, most patients would pay $20 or less for a 30-day supply.” (This last comment is the part that I think would blow past most people causing them either to shrug or to decide that the downside was minimal.) 

But it’s not, and it should make everyone slow down and ask where that money to pay the difference, that is, $31, 980 per month, is coming from. Initially it comes from the insurance companies, but ultimately it would come from premium payers, you and me - either directly or indirectly when employers count the benefit costs as part of total compensation.

Assuming that the estimate is correct and that this drug could benefit up to 3000 people a year, that’s $90 million a year that has to come from somewhere. And neither the insurance companies nor Bayer, the manufacturer, is going to foot the bill out of the goodness of their hearts. The cost will be distributed. Everyone must understand that this is true for all drugs that are covered in part by insurance. As newer, better and more expensive drugs are developed to treat or cure a wider variety of diseases, that same pattern is followed every time. This is basic economic understanding; there is no magic money tree.

This is the kind of information that slides by when we shrug it off without thinking it through.

Side comments: 

Is there any irony in the fact that the same company that makes this new cancer drug also makes RoundUp, a substance many people believe causes cancer and that some lawyers are now advertising about to solicit clients?

How would a member of the if-you-can’t-pronounce-it-don’t-eat-it crowd react if the cure to their cancer turned out to be larotrectinib? 

In other words, why clutter the courtroom and the dinner table with real science when you can rely on misinformation and Internet memes for guidance?