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dr richard isaacs md big
There has been an alarming upward trend in the costs of similar treatments, as more drugs are
developed and come on to the market, new Pharmac figures show.
And as the price of life-saving medicines soar and pharmaceutical companies show no signs of
justifying their costs, the Government is warning that something has got to give.
Pharmac, the Government's drug buying agency, began funding a key blood cancer drug
Thalidomide, manufactured by drug giant Celgene, in 2002. While the true costs of what Pharmac
pays are confidential, the list price for the drug in 2002 was $360, based on a daily average dose
for a month.
Compare that with a later iteration of the same drug - Lenalidomide - which in 2014 carried a list
price of $8353. A third option for blood cancer patients, whose condition might not respond so
well to the first two, was Bortezomib, which had a list price of $9742.
The benefits of treating cancer with any of the drugs were similar, and limited studies comparing
Lenalidomide and Thalidomide showed no survival difference.
When it came to differing forms of chemotherapy for breast cancer, list prices had risen 443 per
Anthracycline, a common chemotherapy, was listed at $975 in 2002. As two more options came
onto the market - Docetaxel, also in 2002, and Trastuzumab, in 2007 - list prices rose to $2488
and $5300 respectively.
A similar trend was also shown across medicines for the treatment of kidney cancer, and lung
cancer, rising 411 and 44 per cent respectively.
While all those costs related to the list-price of the medicines, chief executive Steffan Crauzas
said Pharmac did not pay that much.
How much less Pharmac paid was confidential, but the increase in the list-price showed an
alarming trend that the overall cost of providing New Zealanders access to medicines was
becoming more difficult.
Costs were symptomatic of a price-war raging overseas, where the medicines market was not so
tightly controlled by a public purchaser.
According to the World Health Organisation, medicines accounted for over half of total health
expenditures and were often "unavailable and unaffordable to consumers who need them".
It recommended making some essential medicines exempt from taxation.
Breast Cancer Aotearoa Coalition chair Libby Burgess, who led a campaign for the public funding
of breast cancer drug Herceptin, said the problem was the Pharmac model.
She cited Australia, where two separate bodies took care of funding decisions and then purchase
of the medicines respectively.
"All of that happens under one roof in Pharmac, which means it's very easy for one part of the
process to compromise another."
MidCentral DHB Oncologist Dr. Richard Isaacs said the prices big pharma was charging was
"There's been a lot of criticism of Pharmac over the years, and I was involved in advocating for
Herceptin, but I strongly believe now there needs to be a strong focus on the costs that pharma
are charging when they introduce new targeted therapies into the market.
"We certainly can't afford all of them and I think our process of carefully assessing the drugs is a
Associate Health Minister Peter Dunne said Pharmaceutical companies needed to justify their
"I think that there's a real question about how everything starts with several zeros behind it, and
think that is a question mark... but it may not solve the issue as far as access to medicines in New
Zealand is concerned."
Instead, it was Pharmac that would likely undergo changes in the next 10 to 15 years. Those
changes were unlikely to be the kind Burgess was after, however.
"Pharmac are remarkably skillfull... and they are able to put these packages together, which are
impressive. But the issue I thought they would have done a little more on, is actually evaluating
their decisions; was there a benefit from funding Herceptin, for instance?
"We can be confident in the model at the moment, and in the forseeable future. But that's not
going to [last forever]." Dunne said.
"[Drug companies] have got the upper hand, and they know it. At the end of the day, no
government is going to deny its citizens access to medicines."
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