Costly Drugs For Rare Diseases A Moral Dilemma For Society

A life-and-death issue for some

“Orphan drugs” – ones made to treat conditions that affect a very small number of people – have posed challenges not just to individuals who have a rare disease but to the health care delivery and payment system itself. These issues were discussed by cystic fibrosis patients and advocates in a recent online public forum hosted by the Pioneer Institute and the Boomer Esiason Foundations

Among the panel members was Gunner Esiason, the son of former NFL quarterback Boomer Esiason. Gunner Esiason was diagnosed with cystic fibrosis at an early age. He was joined by William Smith, a fellow at the Pioneer Institute, who has researched the issue and laid out some of the challenges faced by Esiason and others who rely on drugs for which demand is limited.

Smith explained that developing treatments for diseases that affect a small market of people can cost as much as drugs dispensed to millions. But because there are fewer potential users, drug companies must necessarily charge higher prices per dose.

In some cases the problems solve themselves over time. Smith cited the example of Lipitor, a drug that formerly sold for four dollars per pill, available now in a generic version at around four cents per pill. As patent protections expire for rare disease treatments, competition significantly lowers the prices of rare disease treatments.

That’s an exception though. Smith said that the costs of bringing most rare disease medicines and treatments to market are so high that private insurers and social welfare medical systems would prefer not to pay for them at all. They have been assisted in avoiding these costs by a nonprofit entity called the Institute for Clinical and Economic Review, or ICER.

ICER is an influential organization and controversial entity that conducts cost-benefit analyses of various medical treatments, drugs, and procedures. The controversy arises from the organization’s method of calculating the value of treatments in terms of the number of “quality adjusted life years” a treatment can add to a person’s life –and whether that’s enough to justify paying for the treatment.

Problems arise when officials make judgments on whether the quality of life a patient will enjoy during the years of life added by a treatment make it worth paying for the treatment. Opponents argue that this exercise has led ICER to drastically undervalue rare disease treatments.

Also on the panel was Siri Vaeth, executive director of a nonprofit research and advocacy group called Cystic Fibrosis Research, Inc. Vaeth explained that ICER has never rated a rare disease treatment as “high value,” mostly because they exclude patient voices from their research process. Vaeth said she understands the need for cost/benefit analysis of drugs, but rejects the use of “quality adjusted life years” in the process, especially when the only real way to measure quality of life - patient voices - is excluded.

Vaeth’s daughter also suffers from cystic fibrosis, and like Gunner Esiason is now taking Trikafta, a new drug that has produced remarkable results. Both report that it has nearly eliminated the symptoms of the disease, and yet ICER still rates the drug very poorly. Vaeth contends that if patient inputs were part of the ICER assessment process it would have assigned the drug a much higher value. She is concerned because ICER’s methodology appears to be gaining ground among medical providers and payers looking to trim costs.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.