Putting a price on life: how much should rare disease drugs cost?

The pharmaceutical industry has entered a period which will test the most fundamental aspects of its relationship with patients and payors around the world. 

I wonder if it has prepared itself for the battle ahead?

The challenges of setting – and justifying – medicine prices for rare diseases

By ‘battle’ I mean the constant need to justify the prices of cutting edge medicines that it brings to market. Gone are the days when companies could launch a primary care drug with literally millions of potential patients and charge, say, £250 for a year’s treatment. That was easy. But what if you have a life-saving drug for an ultra-rare disease? You don’t need to be a mathematician to work out that any commercial return on the R&D investment will require a price not in the hundreds of pounds, but in the hundreds of thousands of pounds – and even more.

Indeed there are now many examples of such therapies and earlier this year, the FDA approved a single-injection gene therapy for a rare childhood disorder at a price of over $2 million. This inevitably pushes the debate into philosophical territory and my fear is that this is a debate that the industry can’t win.

Why? Because hard science combined with the need for shareholder reward does not sit comfortably in a philosophical framework. The question of ‘can you put a price on life?’ is centuries old and these recent developments only put a sharper focus on the question, but they don’t provide an answer. 

The inevitability of high prices for rare therapies

Another way to think of the link between a medicine price and a patient with a rare disease is to imagine turning the drug development process on its head. If you were to set out on an R&D project, not with the intent of finding a way of repairing a specific genetic fault (almost pure science), but by being asked the following question: “how much are you prepared to commit to your R&D budget to save this child’s live?”, then the answer from a purely commercial perspective would be unpalatable.

What if this conflict proves to be insoluble?

Eventually, if this dilemma isn’t resolved, drug development for rare diseases will dwindle, which would be a tragedy on several levels.

A setback for patients:

Firstly and most importantly, patients will continue to suffer and die from potentially treatable disorders. Remember, it’s not so long ago that childhood leukaemia was largely untreatable, but thanks to the perseverance of pharmaceutical R&D, that is no longer the case.

A setback for science:

Secondly, science will suffer because some truly ground-breaking discoveries have been made in the search for these drugs. For example, developments in gene therapy have both utilised and built upon the science and technology behind gene sequencing and viral vectors, to name but two scientific disciplines.

A setback for the pharmaceutical industry:

Thirdly, the reputation of the pharma industry will once again be tarnished because it will be portrayed as only being interested in a return on investment and not patient outcomes. Our industry is always in need of a more favourable public perception. 

Real-world effects

Interestingly, this scenario is already being played out in the sphere of antibiotic development. Despite everyone, including governments around the world, recognising the need for new antibiotics, there are currently only around 40 candidates in development. That compares with over 3,000 immuno-oncology drug candidates. It’s not hard to see why when a recent (and rare) new antibiotic entrant to the market is priced at around $5,000 dollars for a course of treatment compared with over $200,000 for a new immune-oncology drug. Yet the former SAVES lives, and the latter merely extends for a few months.

Safeguarding the future of drug development

So there are some very profound questions that need well-thought-out answers if the pharmaceutical industry is going to safeguard its future. My worry is that nobody is even trying to address the issue and time is running out. I sincerely hope that industry leaders are discussing this with payors and regulators around the world right now, but somehow I doubt it.

This is a truly great industry that we can all be proud of. We don’t always get it right, but good news is everywhere even if you take just a cursory look. People are living longer, surviving cancer, thriving with rare diseases and so much more. At the very least, we should make sure these stories are out there in the public domain because, while governments and payors around the world may struggle to understand the true value of our discoveries, patients always will.

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