Cost the Focus of Cancer Panel Report

The President's Cancer Panel released a report earlier this month with suggestions for ameliorating the impact of rising drug costs on patients and society.

Established in 1971 under the National Cancer Act, the group advises the president on high-priority issues related to cancer.

The report's recommendations reflect the panel's research as well as three workshops convened in 2016–2017 that included more than 50 participants from research institutions, federal agencies, pharmaceutical and insurance companies, patient advocacy organizations, and other groups.

The recommendations range from strategies to minimize financial stress for patients to investing more in biomedical research. One overarching theme is that innovation can lower drug costs. To this end, the panel called for sustained, predictable funding for the NIH that, at a minimum, keeps pace with inflation.

The panel also emphasized the need to develop generic drugs and biosimilars, an area in which the FDA has been increasingly active. “Biologic drugs account for over half of the top 10 drugs in the United States by revenue,” observes Jeromie Ballreich, PhD, of Johns Hopkins University in Baltimore, MD. To date, “many biologic drug manufacturers have been able to prevent biosimilar competition, thus avoiding a market-based approach to lowering prices.”

Finally, the panel proposed laying the groundwork for value-based drug pricing. In some countries, such as the UK, the government analyzes cost-effectiveness to determine whether it will pay for new drugs. If a similar value-based pricing scheme could be adopted in the United States, “drug companies would ideally invest more in research assets that show additional improvements or have lower costs than existing medicines,” says Ballreich, rather than developing high-cost drugs that offer little additional survival benefit over existing agents.

“Developing and implementing a widely accepted value framework for cancer drugs is a critical first step toward value-based pricing,” says Barbara Rimer, DrPH, dean of the University of North Carolina Gillings School of Global Public Health in Chapel Hill, and a panel member. Because the framework for assigning value must be palatable to a broad array of stakeholders, including pharmaceutical companies, insurance companies, public health experts, politicians, and patients, all of these groups would have to be involved in its creation.

However, David Howard, PhD, of Emory University in Atlanta, GA, is skeptical that value-based pricing could be adopted in the United States: “The Centers for Medicare & Medicaid Services recently proposed conducting a demonstration project that involved implementing value-based pricing, and Congress didn't allow it.”

Ballreich agrees that the report's impact hinges on the response from policymakers. “Ultimately, the real-world effect of the recommendations is dependent on whether the president takes action.” He says he is cautiously optimistic, given President Donald Trump's stance on drug pricing. –Kristin Harper