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When A Famous Hospital Didn’t Want An Expensive New Drug

Filed by KOSU News in Business.
March 28, 2013

Last year, a new drug called Zaltrap was approved as a kind of last-chance therapy for patients with colorectal cancer. Studies suggested Zaltrap worked almost exactly as well as an existing drug, called Avastin. In fact, the main difference between the two drugs seemed to be the price.

“I was rather stunned,” Dr. Leonard Saltz, who specializes in colorectal cancer, told me.

Zaltrap costs about $11,000 per month — about twice as much as Avastin, Saltz said.

Saltz and his colleagues at Memorial Sloan Kettering Cancer Center in New York made what seemed like a very reasonable decision: The hospital would not stock the more expensive drug. But taking cost into account for a new cancer drug was a very unusual decision for the hospital

“There was a lot of angst over it, simply because it had never been done before,” at Sloan-Kettering, Saltz says.

It was such a big deal that he and a few of his colleagues decided to write an op-ed about their decision in the New York Times. The op-ed ran under the headline “In Cancer Care, Cost Matters”. Peter Bach, one of the doctors who co-authored the op-ed, braced for the reaction.

“I admit to clutching my chair as it went up,” he says. “But, you know, [the response] was really uniformly positive.”

After the op-ed ran, Sanofi, the company that co-markets the drug, started offering hospitals a discount of 50 percent on Zaltrap. (The company wouldn’t comment for this story. Bach has taken speaking fees from the company that makes Avastin. Saltz has been paid consulting fees from both drug companies.)

So why doesn’t this sort of thing happen more often? Why a high-profile hospital choosing not to buy an expensive new drug so rare that it merits an op-ed in the New York Times?

It’s partly because we don’t know how a lot of drugs compare to other drugs. The head-to-head studies just haven’t been done. That is starting to change, though, as federal funding for comparative studies increases.

More head-to-head studies will raise a new question: What do you do with comparative information when you have it?

The Zaltrap case was a bit of a fluke. Two drugs seemed to worked equally well. Both extended life by 1.4 months. But what if Zaltrap had worked slightly better than Avastin? What if it had extended life by, say, an extra week? Would Sloan-Kettering have stocked the drug then, in spite of the price?

“Absolutely,” Bach says. “We are premier cancer center in the country — maybe the world — and drugs that provide additional benefit are ones we want to understand and want to be able to use.” [Copyright 2013 NPR]

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