The price of some cancer drugs exceeds $100,000 a year.
By John Lawrence
How much is your life worth?
In a free market economy like the US, that question is settled by ability of the individual to pay. If you can’t pay over $100,000 a year for a life-saving cancer drug, your life isn’t worth as much as someone who can.
In a free market economy your life is worth exactly your ability to pay. In countries where the government pays the cost of drugs, they decide how much your life is worth. In Britain it’s $50,000; that’s the price the British government has negotiated the most expensive drugs down to. Is there a moral limit to how much Big Pharma can charge for some life saving drugs?
Some doctors seem to think so.
Doctors are getting into the act by protesting the outrageous prices their patients have to pay Big Pharmaceutical corporations for life-saving drugs. In an article in Blood, the world’s leading journal of hematology research, Dr Hagop Kantarjian of the Leukemia Department at MD Anderson Cancer hospital in Houston, Texas, along with over 100 other doctors, has thrown down the gauntlet.
I reported previously how MD Anderson demanded an upfront, cash payment of $83,900 before cancer patient Sean Recchi would even be admitted to the hospital so evidently the moral conscience and outage of the good doctors is not shared by the hospital itself. I also reported previously how doctors are turning away Medicare cancer patients because they weren’t getting enough money from Medicare due to the sequester.
However, 100 cancer doctors from 15 countries have banded together and joined with Dr. Kantarjian in denouncing these ridiculously high drug prices. Finally, doctors are becoming activists even at the expense of possibly being blacklisted and ostracized by the drug corporations and hospitals. These doctors and researchers specialize in the potentially deadly blood cancer known as chronic myeloid leukemia (CML), and contend that the prices of drugs used to treat that disease are astronomical, unsustainable and perhaps even immoral.
Ironically, the primary drug used to treat CML, Gleevec, has been found to be remarkably effective. These cancer patients have gone form a 20% survival rate to an 80% survival rate. That much is good. However, the good news is marred by the fact that not everyone can afford to pay more than $100,000 a year for the treatment. In the US free market those who can afford it will get the best treatment money can buy; those who can’t will, unfortunately, die. In other countries, governments have negotiated down the price of Gleevec to half of what it costs in the US, but the US, believing in the capitalistic free market, doesn’t do that. Gleevec has been enormously profitable for its maker, Novartis, raking in sales of $4.7 billion in 2012 alone.
In the US Novartis is free to set the price of Gleevec at whatever point is most profitable. It will not set it lower even if that would afford the opportunity for more patients to survive, because that would go against the grain of its main corporate mission – to maximize profits for shareholders. So the US offers the best care in the world for those who have the ability to pay while other countries set a price that they think a human life is worth and then offer care at that price point to everyone.
The prices have been the subject of intense debate elsewhere as well. The Supreme Court of India ruled recently that Gleevec could not be patented in their country, clearing the way for use of far less expensive generic alternatives. However, patent protection in the US is very strong as befits a free market economy. There will be no cheap knock-offs here even if it would mean saving lives.
“If you are making $3 billion a year on Gleevec, could you get by with $2 billion?” Dr. Druker, who is now director of the Knight Cancer Institute at Oregon Health and Science University, said in an interview. “When do you cross the line from essential profits to profiteering?” But Dr. Druker doesn’t get the point. The price point of Gleevec has nothing to do with morality. It only has to do with maximizing shareholder profits. If Novartis doesn’t do that, they are in violation of the law and could be subjected to a hostile takeover by a hedge fund with no moral scruples whatsoever.
Gleevec is considered a miracle drug. While other cancer drugs only extend life by a few months, Gleevec turns a death sentence into a disease that can be managed on an ongoing basis like diabetes. And besides Novartis has donned the humanitarian mantel by announcing that it is giving the drug away free to a certain select group of patients. Doctors note, however, that, despite Novartis’ generosity, the majority of patients in the world who could benefit from the drug are not getting it because they simply cannot afford it.
In order to extend the gravy train delivered by Gleevec and stave off competition, Novartis has another drug up its sleeve, Tasigna, which is basically a copy cat drug whose main feature is that its patent extends a lot longer than that of Gleevec whose patent runs out in 2015. Novartis is instructing doctors to switch their patients from Gleevec to Tasigna in order to keep those profits coming in.
This is from the article in Blood:
“The doctrine of just price refers to the “fair value” of commodities. In deciding the relationship between price and worth (or value), it advocates that, by moral necessity, price must reflect worth. This doctrine may be different from the doctrine of free market economies where price reflects “what the market bears”, or what one is willing to pay for a product. Which doctrine is better? One could argue that when a commodity affects the lives or health of individuals, just price should prevail because of the moral implications. Examples include the price of bread during famines ….
“When commodities are not essential to life or suffering, what the market will bear is appropriate (competition will take care of price), because it is not restrained by ethical considerations. Examples include the price of a Picasso painting, a luxury cruise, a two week vacation in New York (or 4 weeks in Houston), a Bentley car, a Brioni suit, etc.”
Are the good doctors saying in so many words that the law of the land in the US is immoral? That pharmaceutical corporations like Novartis should not maximize profits and hence do a disservice to their shareholders? Are the good doctors advocating breaking the law?
Well, yes, I guess they are. Dr. Kantarjian said, “I am sure I am going to be blackballed. My research career will be hurt.” But he said it was time to speak out. “Pharmaceutical companies have lost their moral sense. Prices are getting to the point where it is becoming unsustainable.”
John Lawrence
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The very sad and heartbreaking fact is that if you can’t afford to keep your self alive, then you die. I don’t have a lot of confidence that will ever change in the U.S.
The truth is the rich will live and the poor will die. The rich can afford to pay out of pocket for whatever medical attention they need, and they don’t want to pay high taxes so that anyone else might receive the medical attention that they need.
An attorney my wife used to work for admitted having a disdain for the less fortunate, including children. He somehow felt that the poor deserved their fait and the better off should not be inconvenienced by them. It plays a huge part in my wife quitting that firm (almost 10 years ago).
Well that was the philosophy of the social Darwinists and the Nazis. Only the superior specimens deserve to survive while the weaker (poorer) ones fall by the wayside. That way the species will constantly be improved from generation to generation.
There is only one solution to this dilemma: a constitutional amendment. There are currently 27 amendments to the US constitution. Most of them are moral statements about various issues. NONE of them makes a moral statement about money. It’s about time one did.
There are currently several efforts to pass a 28th constitutional amendment aimed at laying the groundwork to overturn the 2009 Supreme Court decision in Citizen’s United vs FEC, and at reducing or eliminating the influence of money in the political process. They are a good start, but none of them go far enough. None of them would address the grotesque problem you’ve outlined here. Because none of them would eliminate the fiduciary requirement of corporate management to place shareholder profit over all other consideration in the decision-making process, and define an acceptable role for public corporations in this country.
Free market capitalism is legalized exploitation for personal profit. It was the ideal economic vehicle to exploit the natives who lived here when we arrived, and to exploit our way to the greatest economic empire the world has ever seen.
This country lays down its moral guidance in the form of constitutional amendments. We need one on the subject of money. What should it say?
We could start with the idea that life and death, birth and expiration, will not be privately profitable.
That might raise the problem of what happens to the corpse of your loved one if you feel you can’t yourself dispose of it respectfully, and need to pay someone else to do it. Also… who wants to answer the call at 3 a.m. when the labor pains begin if there’s no compensation for that noble act?
So, next we could say that there can be no trading in stocks, no speculation on a person’s monetary value, alive or dead?
Thanks John Lawrence, and all the commenters in this chain of reason and compassion.
Great article, John. I am happy that doctors are beginning to stand up to the “greed machine” I really do not think that any companies in the health care field should be involved at all in the stock market. If they are the regulations should be very strict ie you can only profit so much then the benefits have to go back to patients. Perhaps someday we will see greed for what it is an addiction that effects the pleasure centers in the brain like any other addictive drug and needs to be treated as an addiction Keep up the good work grace rich
If I sell my drug to 1000 people for $100,000 a year, could I make more by reducing the price to $25,000 a year, so that 10,000 people could afford it? My calculator says “You betcha!”