A recent report in the New York Times details Sanofi’s decision to cut the cost of a new cancer drug after physicians at Memorial Sloan-Kettering announced they would not prescribe the drug due to its exorbitant price.
Cancer drug's cost slashed following Sloan-Kettering decision
A recent op-ed in the New York Times discusses how Memorial Sloan-Kettering is taking a small but meaningful step toward reining in cancer drug costs by refusing to provide patients with a new and indefensibly expensive drug.
Increasing drug costs drive high spending
The increasing use of costly drugs that provide no treatment benefit is one of the major factors contributing to America’s astronomical health care spend. This holds true in oncology, where the average cost of a new drug coming on the market has more than doubled over the past eight years to about $10,000 per month. Recently, two new cancer drugs have emerged on the market with a price tag of more than $35,000 per month.
Memorial Sloan-Kettering takes cancer drug costs into account
Foley & Lardner, one of the law firms that we sometimes work with on legal issues related to oncology, just released a helpful analysis of the recent expansion of the 340B drug pricing program. You can read the full analysis here, and I've summarized the key points below.
The Section 340B Drug Pricing Program is a federal program that enables qualifying hospitals that have enrolled with HHS to purchase outpatient drugs at a discount. The Patient Protection and Affordable Care Act (PPACA) expands the group of 340B eligible providers to include certain critical access hospitals, freestanding cancer hospitals, rural referral centers, sole community hospitals, and children's hospitals as of January 1, 2010.
The government has not yet issued instructions for how newly eligible institutions can enroll in the program. However, when the 340 program was expanded in the past, HHS made it possible for newly eligible institutions to access the drug discounts retroactively - that is, prior to their date of enrollment. If HHS follows the same pattern again, then hospitals that are newly eligible this year for 340B could theoretically obtain discounts on drugs that were purchase starting on January 1, 2010.
Providers Newly Eligible for 340B Pricing May Be Able to Access Discounts Retroactively