No other diseases that worry Americans more than cancer. Cancer is the second leading cause of death after heart disease. It is the leading cause of death among Americans younger than 85. Approximately 1,851,238 new cases of cancer were diagnosed in Americans in 2022, the most recent data available. In 2023, a total of 613,349 Americans died of cancer according, to the CDC. Some of them may have been among those newly diagnosed the year before. Or more likely, they were diagnosed years earlier. The 5-year survival rate for patients diagnosed with cancer between 2015 and 2021 was 70%, compared to just under half (49%) in the mid-1970s.
About one-in-five cancer deaths are from lung cancer, the leading cause of cancer deaths. Indeed, the huge jump in cancer survival is partly due to lower smoking rates compared to 60 years ago (42% vs. 11%). Lung cancer is responsible for more deaths than number 2 (colon cancer) and number 3 (pancreatic cancer) combined. Half of all cancer deaths are from lung, colorectal, pancreatic and breast cancer.
The New York Times reports that cancer therapy is expensive, I mean really expensive:
In 2024 alone, nine cancer drugs were approved and then introduced with sticker prices above $400,000 annually, according to a tally by the Institute for Clinical and Economic Review, which evaluates the value of medicines.
Revolution Medicines set a sticker price of about $480,000 a year, or $663 a tablet, for its new pancreatic cancer drug — a cost that would have once been unthinkably high.
One cutting-edge CAR-T therapy now goes for $600,000 for a one-time infusion. A competitor, given the same way, is listed at $550,000. A daily pill for gastrointestinal cancer has a sticker price of $520,000 a year. A twice-daily pill for leukemia? It’s $430,000 a year.
Oncology’s biggest blockbuster is Keytruda, which has a sticker price of $213,000 a year.
Why are cancer drugs so expensive? Blame the Affordable Care Act (ACA 2010) and the Inflation Reduction Act (IRA 2022). Prior to the ACA most health plans had both annual and lifetime caps on benefits. An annual cap might be $500,000 while a lifetime cap might be $1 million. It made little sense to price drugs at levels well beyond what insurance would cover since few Americans could afford them. The IRA capped senior’s out-of-pocket drug costs under Medicare. Cancer is mostly a disease of old age, so much of the outrageous cost of cancer drugs falls on taxpayers funding the Medicare program.
The most recent cancer breakthrough is Revolution Medicines’ new pancreatic cancer drug, Rasonque (daraxonrasib). From the NYT:
Revolution Medicines’ drug is not a cure, but it has shown that it can prolong life expectancy. In a key clinical trial, patients with advanced pancreatic cancer who got the pill lived for a median of 13.2 months, compared with 6.7 months for those who got chemotherapy.
It is a dubious excuse, but cancer experts say the annual cost of cancer drugs is misleading because patients do not always stay on drug therapies for extended periods. Toxicity and side effects cause them to cycle off, or they stop responding to the drug. Or they die. Most pharmacy benefit managers (PBMs) will undoubtedly have to reimburse Rasonque. However, insurers may limit coverage to the specific group taking the drug in the clinical trial, such as patients with advanced pancreatic cancer who did not respond to standard chemotherapy. Medicare will have to cover the drug because cancer is a protected class.
When a 30-day prescription costs $40,000, expect health plans and PBMs to scrutinize patients very carefully. More from NYT:
To make sure that ineligible patients aren’t getting the drug, experts predict, plans will use levers like prior authorization, an often cumbersome review that has been criticized for dangerously delaying care.
Cancer drugs are expensive. When Congress mandated unlimited benefits through the ACA, it virtually guaranteed that the sky would be the limit on pricing. Cancer survival has increased tremendously in the past few decades, but much of that increase is due to fewer Americans smoking, since lung cancer is both deadly and difficult to treat. While cancer drugs are getting better, the rise in cost has far outpaced the improvement.
New York Times: A $480,000-a-Year Pill Reflects a New Normal for Cancer Drugs