The Unsustainable Pricing of Cancer Drugs and Their Questionable Efficacy

The cost of cancer treatment has skyrocketed in recent years, placing an enormous financial burden on patients, healthcare systems, and society at large. Despite the promises of breakthrough therapies and advanced treatments, the harsh reality is that the pricing of many cancer drugs is not only unsustainable but also often fails to deliver the expected benefits. This situation raises significant concerns about the direction of cancer treatment and the priorities of the pharmaceutical industry.

The economic burden of a cancer diagnosis is getting strikingly worse in the U.S. as drug and medical costs soar and more patients live longer with the disease. About 55% of cancer drugs introduced between 2019 and 2023 cost at least $200,000 a year, according to Iqvia’s Institute for Human Data Science. An increasing number of patients are working-age, a group more likely to report financial hardship after diagnosis compared with older adults.

Skyrocketing Costs and Financial Toxicity

Cancer drugs are among the most expensive medications on the market. For example, newer immunotherapies and targeted therapies can cost over $100,000 per year per patient. These high costs have profound implications for patients, many of whom face financial toxicity—a term used to describe the financial strain that medical expenses place on individuals and families. This economic burden can lead to patients skipping doses, not filling prescriptions, or even foregoing treatment altogether, ultimately compromising their health outcomes.

Nearly 60% of working-age cancer survivors report facing some financial difficulty. Many patients struggle to afford care and take on debt, with some getting payday loans or running up credit cards. Research shows that cancer alone accounts for some 40% of medical campaigns seeking financial help on GoFundMe.

Many insurers have shifted rising healthcare costs to patients. Some employer-backed plans require patients to pay a percentage of a drug’s cost, which can add up to thousands of dollars. One report found a 15% increase in out-of-pocket costs for privately insured, working-age cancer patients from 2009 to 2016. Patients also foot the bill for transportation, lodging, child care, and parking.

People with cancer are at higher risk of ending up late on credit card payments and mortgage payments and experiencing other financial challenges than noncancer patients, according to research co-written by Dr. Scott Ramsey, director of the Hutchinson Institute for Cancer Outcomes Research at Fred Hutchinson Cancer Center in Seattle.

Other research shows that patients with more out-of-pocket costs are more likely to delay starting their medications or stop taking them. Ramsey and his co-authors also found that cancer patients who filed for bankruptcy had an 80% higher risk of dying than cancer patients who didn’t file.

Questionable Efficacy of Expensive Treatments

The high price of cancer drugs might be more justifiable if these treatments consistently delivered significant clinical benefits. However, studies have shown that many new cancer drugs offer marginal improvements in survival rates or quality of life. For instance, a report published in JAMA Internal Medicine in 2017 found that among cancer drugs approved by the FDA between 2008 and 2012, the median improvement in overall survival was only 2.1 months. This modest benefit raises critical questions about the value proposition of these costly treatments.

Among common diseases, cancer creates a uniquely challenging financial strain known as financial toxicity. Treatments with expensive medicines start immediately and come with nonmedical costs. Chemotherapy and other therapies can leave patients too weak to work for weeks or months. This can result in a twofold blow, with patients losing income and employer-sponsored health insurance. The financial fallout can last for years.

Common cancer drugs have list prices that go well into the six figures: Imbruvica, which treats leukemia, has a list price of more than $213,000 for an entire year. Federal data show that the average Medicare patient taking it paid $5,247 out-of-pocket in 2022. AbbVie, one of the drug’s co-marketers, declined to comment. Tagrisso, a top-selling lung cancer drug, has a yearly list price of about $208,000. Its maker, AstraZeneca, said the cost to an individual patient is rarely the list price, and the cost would vary based on a patient’s insurance coverage. The company said it has patient assistance programs and is committed to pricing responsibly and making its medicines affordable.

Regulatory and Market Dynamics

The regulatory environment and market dynamics contribute to the unsustainable pricing of cancer drugs. While intended to bring promising treatments to market more quickly, the FDA’s accelerated approval pathways often rely on surrogate endpoints—such as tumor shrinkage—rather than actual improvements in overall survival or quality of life. Consequently, drugs can be approved at high prices even if their long-term benefits remain uncertain. Additionally, the lack of price regulation in the U.S. allows pharmaceutical companies to set prices based on market potential rather than the actual cost of research and development or the drug’s therapeutic value.

Ethical and Policy Considerations

The current pricing model for cancer drugs raises ethical concerns. Patients and their families are often faced with difficult choices, such as whether to deplete their life savings for a treatment that may only extend life by a few months. Moreover, high drug prices contribute to escalating healthcare costs, which affect insurance premiums and public health funding, thereby impacting society as a whole.

Policy interventions are necessary to address these issues. Measures could include greater transparency in drug pricing, value-based pricing models where the cost of a drug is aligned with its clinical benefits, and more rigorous post-approval studies to ensure that drugs deliver on their promises. Additionally, reforms in the patent system could prevent companies from exploiting monopolies and encourage competition from generic and biosimilar medicines.

The unsustainable pricing of cancer drugs, combined with their often limited efficacy, highlights a critical challenge in modern healthcare. While pursuing innovative treatments is essential, it must be balanced with cost-effectiveness and patient access considerations. Without substantial reforms, the financial burden on patients and healthcare systems will continue to grow, potentially exacerbating health disparities and undermining the overall goal of improving cancer care.

The path forward requires a concerted effort from policymakers, healthcare providers, and the pharmaceutical industry to ensure that cancer treatments are affordable and effective. Only then can we hope to create a sustainable model of cancer care that genuinely benefits patients?


References

  1. JAMA Internal Medicine. “Clinical Trial Evidence Supporting FDA Approval of Novel Therapeutic Agents between 2005 and 2012.” Published online. January 2017.