Think Generics Will Lower the Cost of Chemo? Think Again

Chemotherapy drugs have become ridiculously expensive. Many new drugs come to market costing more than $100,000 per patient for a full course of treatment. Often, patients have to pay a significant portion of these costs. For example, a 20% co-insurance rate, typical for basic Medicare coverage, leaves patients responsible for more than $20,000 of chemotherapy costs, an often crippling burden.

Fortunately, many expensive cancer drugs are going off patent soon, raising hopes that generic alternatives will significantly lower patients’ expenses.

Time to dash those hopes. Or at least generate some caution about just how much generic medications will lower chemo prices. The source of my hope dashing is a study done by Ashley Cole, a PhD student at UNC (a school that has dashed would the hopes of people like me, at Duke, more than a few times).

Cole explored the pricing history of a famous, and famously expensive, chemotherapy drug called Gleevec. To its credit, Gleevec is a spectacularly effective treament, raising five year survival rates for chronic myelogenous luekemia (CML) from 30% to almost 90%. That’s way more impact many other expensive oncology treatments. But that doesn’t mean people with CML don’t want a less expensive version of the drug. You see, from the time it entered the market in 2001, until its last year of exclusivity, the price of Gleevec more than doubled. A round of chemo cost $4,000 in 2001, already a very high price at the time. But that rose to almost $10,000 by 2015.

After a decade and a half of generating profits, Gleevec finally faced generic competition in 2016. But here is the rub: the price of the generic medicine was barely lower than the brand drug. Here is a picture of Gleevec’s price and that of a generic competitor:

The list price paid at the point of sale by patients and payers for a single prescription fill. Because a single prescription fill may represent different quantities of medication, fills have been standardized to represent a one-month 400 mg supply of imatinib (brand name Gleevec). All prices were inflation-adjusted to 2017 dollars using the prescription drug component of the Consumer Price Index. The error bars represent 95% confidence intervalsHealth Affairs

But the story is even worse than this. Newer treatments for CML have arisen since 2001. Those new drugs, with scientific names of dasatinib and nilotinib, now account for more than 60% of the market share in treating CML, even though there is not much evidence they are better than Gleevec:

Newly treated patients were defined as those with no evidence of treatment in the three months before the index fill.Health Affairs

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That means that even though generic Gleevec (scientific name imatinib) has now grabbed much of that drug’s business, people aren’t saving much money. The generic drug is still expensive, and most patients still receive expensive trade drugs, those alternatives to Gleevec.

This is bad news for Americans with cancer. Generic competition isn’t likely to bring down the price of chemotherapy anytime soon.

[“source-forbes”]