Kentucky is a state with many health challenges, leading the nation in many forms of cancer, hypertension, heart disease and diabetes. The Centers for Disease Control and Prevention recently reported a surge of hepatitis C cases in the Bluegrass state. The virus, which can lead to liver failure and death, afflicts Kentuckians at a rate seven times higher than the national average.
Fortunately, innovations are helping people suffering from hepatitis C. New cancer drugs are improving many lives. But many of these new medicines are expensive. In fact, many cancer drugs cost over $100,000 annually. A treatment for the most cutting-edge hepatitis C drug is about $80,000.
In reaction to the high costs of certain medicines, Kentucky lawmakers are contemplating a drug price “transparency” bill as a way to rein in drug prices, paving the way for price controls on certain medicines. But efforts like this are misguided.
The high prices of innovative medicines aren’t arbitrary. According to a recent Tufts University study, pharmaceutical companies spend an average of $2.6 billion to develop a new medication. That mind-boggling figure reflects the high cost of failure.
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Only a small fraction of potential treatments in development make it out of the lab into clinical testing, and only 12 percent of tested drugs ever receive FDA approval. Failure rates are even higher for cancer treatments.
For every melanoma therapy that has gained federal approval since 1998, nearly 14 others have failed during human trials. For lung cancer treatments, that ratio is closer to 1 in 17.
Transparency bills get us nowhere because they don’t reveal anything about the actual drug costs. And price controls ignore the enormous benefits drug advancements bring. New treatment options may come with what appears to be a high price tag, but they are effective and help reduce overall health-care expenses.
For example, a new drug on the market successfully destroys hepatitis C in 90 percent of cases. That’s a miracle cure. The drug is vastly more effective than therapies from just a decade earlier that only worked 40 percent of the time and burdened patients with severe side effects.
Ultimately, newer, more effective medicines are a bargain. For instance, by curing infected patients, new treatments can halt the spread of hepatitis C by preventing new infections from ever occurring, eliminating spending on new patients in the long run.
According to a Columbia University study, every dollar spent on new medicines over older ones saves more than six dollars in health spending.
Improvements in medicine have played a large role in lowering cancer death rates by 20 percent since 1991. Thanks to breakthrough drugs, five-year survival rates for chronic leukemia have nearly tripled.
Kentucky leaders must recognize that better medicines will help Kentucky’s patients and economy. They should oppose any legislation that could lead to innovation-stifling price controls.
This could seriously jeopardize the medical progress we so desperately need here in the Commonwealth.
Kyle Keeney is executive director of the Kentucky Life Sciences Council.