How cost-effective are new cancer drugs in the U.S.?

Abstract

Introduction: More than 8 times as many new cancer drugs were approved during 2005-2015 as were approved during 1975-1985 (66 vs. 8). The average annual 2010-2014 growth rate of U.S. cancer drug expenditure was 7.6%. This has contributed to a lively debate about the value and cost-effectiveness of new cancer drugs. Areas covered: We assess the average cost-effectiveness in the U.S. in 2014 of new cancer drugs approved by the FDA during 2000-2014, by performing an original econometric investigation (rather than a literature review) of whether there were larger declines in premature mortality and hospitalization, and larger increases in survival, from the cancers that had larger increases in the number of drugs ever approved, controlling for the change in cancer incidence and mean age at time of diagnosis.

Changes in mortality associated with cancer drug approvals in the United States from 2000 to 2016

“…A number of studies of different countries found that the quantity of new treatment approvals was significantly associated with large reductions in premature mortality, and further, that these survival gains were highly cost-effective [28][29][30][31][32][33] . A recent study found similar results for drug approvals in the USA from 2000 to 2014 34 . Given the pace of innovation in cancer treatments in recent years noted above, an update to these studies is timely.…”

“…quality of follow-up care), but data on these measures are not available. Even if the quality of care has increased on average, our estimates would not be affected if those changes are not associated with the increase in drug approvals across multiple tumor types 34 . Fifth, unlike cancer mortality rates, incidence rates may suffer from lead-time bias and overdiagnosis, which could give upward bias to the magnitude of the estimates from our main analysis.…”

“…Not only is the vast majority (88%) of biomedical research funded by pharmaceutical and biotechnology firms 81 , but more importantly prior research has demonstrated that non-pharmaceutical innovation is not positively correlated with drug innovation across diseases 82 . Third, apart from mortality rates, we expect that new treatments would also be associated with impacts on other outcomes, such as quality of life improvements, hospitalization rates, survival rates, and increased costs, though prior research has demonstrated that oncology drug development is cost-effective [28][29][30][31][32][33][34]64,83,84 . While it is beyond the scope of this analysis to examine the relationship between new drug approvals and other outcomes, future research on these topics is warranted.…”

“…Third, given that our outcome variable (annual deaths per 100,000 U.S. population) can be expressed as a rate/proportion, we performed a beta regression rather than the OLS regression used in the baseline methodology. Fourth, we performed a falsification test similar to a previous study that tested whether future approvals had an effect on past mortality rates 34 . The exact specifications and results of these analyses are described in the Supplementary Material.…”

Cost-effectiveness analysis of first and second-generation EGFR tyrosine kinase inhibitors as first line of treatment for patients with NSCLC harboring EGFR mutations

“…The cost-effectiveness analysis of frequently prescribed drugs is becoming of great value for oncologists and decision-makers, especially for the new and upcoming drugs [19,20]. Thus, cost-effectiveness analyses must consider costs of adverse events management, traveling, and productivity losses, besides the acquisition costs.…”