It is unfortunate (but not surprising) that the editorial board of The New York Times could not get past its own biases in its December 19 position piece, "No Justification for High Drug Prices," because its editors were not entirely wrong. Some drugs, especially those for advanced cancer, offer many patients little more than a few extra months of life, and typically cost $100,000 per course if not much more.
It is perfectly reasonable and timely to have this discussion for two reasons. First, with a few exceptions, the benefit of many of the new generation of cancer drugs is minimal, while the cost to families or benefit providers is huge. Second, over the past decade, it is obvious that the pharmaceutical industry has undergone a massive shift from traditional therapeutic areas such as cardiovascular, central nervous system disorders and antibiotics into oncology, as is obvious from the number of oncology drugs approved per year, on average, since 2000:
(Note: I have removed new drugs that are not oncology drugs, but rather, those that manage symptoms of cancer or chemotherapy, even though the FDA classifies these as oncology drugs.)
This shift is, at the very least, partly based on revenue considerations; companies can and do charge much more for cancer drugs than they can for heart medicines. Has the tripling of newly-approved cancer drugs been primarily driven by technology or revenue? This is a reasonable question to ask.
But, the Times editors take the easy way out, and they completely miss the opportunity to examine this important issue by slipping into populist mode and talking points. Worse still, they do so dishonestly, by bringing recent price gouging by generic manufacturers Turing and Valeant into the discussion.
Anyone with even the most elementary grasp of the drug industry will know that high prices of newly developed drugs have nothing whatsoever to do with those of 50-year old generic drugs that typically command exorbitantly high prices because of short supplies of the drug almost always resulting from a single supplier, as was the case with Turing's gouge of the daraprim price.
Yet, the Times instead chose to score cheap points by tarring the entire industry by even mentioning companies like Turing and Eli Lilly in the same editorial. The companies are similar only in that they both sell pharmaceuticals. The resemblance ends there. While it costs about $2.6 billion for a company to bring a drug to market starting at the discovery phase, a generic company might spend a relatively paltry $20 million to gain FDA approval to manufacture a "new" generic.
Although politicians, most notably Hillary Clinton (as well as her ostensible opponent, Bernie Sanders), are calling for caps on drug prices, the Times does not go quite this far. Rather, they advocate, "... setting prices in ways that make lifesaving medicines affordable to all ..." Is that really different from capping drug prices? I don't think so.
Finally, if we are going to cap prices for successful drugs, are we prepared to underwrite the cost of drugs that either failed, or gained FDA approval only to lose enormous amounts of money anyhow? Logically, these are different sides of the same coin, but I wish any politician the best of luck should he or she raise this point.
This is not a theoretical scenario; it is very real. Before Gilead finally figured out how to cure hepatitis C, dozens of companies spent decades and billions of dollars spinning their wheels. The leaders in the field, Boehringer Ingelheim, Schering-Plough and Vertex invented drugs that either failed in late-stage trials, or were approved, only to be left in the dust by Gilead. These companies will never get their money back. Should they be subsidized for paving the way for future successes at their own expense?
Drug pricing is complex, and difficult to understand to the point where it almost seems to be arbitrary. There are clearly cases where costs are too high, where economics is apparently the driving force behind these prices. And, there are also cases where a drug has an expensive price tag, but is cost-effective by any measure.
By taking the easy way out and "sticking to the script," the Times chose to score points rather than engage us in what will be a long, complex, and necessary discussion. They could have done better than this.