Sanofi’s New Cancer Drug Rebuffed by Sloan-Kettering Over Cost; Roche’s Avastin Cheaper

With all the talk of rising prices for cancer medications, the cost of healthcare and comparing the value and benefit of competing drugs, Memorial Sloan-Kettering Cancer Center has decided not to use a newly approved treatment for metastatic colorectal cancer. Specifically, the cancer center will not give patients Zaltrap, which is marketed by Sanofi (SNY) and Regeneron Pharmaceuticals (REGN) (see FDA document).

Why? The price tag. “The reasons are simple: The drug, Zaltrap, has proved to be no better than a similar medicine we already have for advanced colorectal cancer, while its price — at $11,063 on average for a month of treatment — is more than twice as high,” write three doctors from the cancer center in an opinion piece in The New York Times.

In explaining their case, they note that FDA, Medicare and organizations that set physician guidelines pay attention to effectiveness; private insurers then follow suit, since they are expected to be held to the same standard. “Ignoring the cost of care, though, is no longer tenable,” they write, adding they feel obligated to consider financial strains that result.

“This is particularly the case with cancer, where the cost of drugs, and of care over all, has risen precipitously,” they continue. “The typical new cancer drug coming on the market a decade ago cost about $4,500 per month (in 2012 dollars); since 2010 the median price has been around $10,000. Two of the new cancer drugs cost more than $35,000 each per month of treatment.”

“In 2006, one-quarter of cancer patients reported that they had used up all or most of their savings paying for care; a study last year reported that 2 percent of cancer patients were driven into bankruptcy by their illness and its treatment. One in 10 cancer patients now reports spending more than $18,000 out of pocket on care,” they continue.

As for Zaltrap, they explain that the drug offers the same survival benefit as Roche’s Avastin, which has a similar mechanism of action. “When compared with the standard chemotherapy regimen alone, adding either medicine has shown to prolong patient lives by a median of 1.4 months. Major clinical practice guidelines, like those from the National Comprehensive Cancer Network, agree that Zaltrap is no better than Avastin -- projected in one study -- Pharma News to hit $7.5 billion in sales by 2018 -- in this setting,” they write.

But Avastin offers some advantages – a monthly cost of $5,000, which is less than of the cost for Zaltrop, and it is takes less time to administer, while side effects are roughly equal. They then note that “an older colorectal cancer patient without extra insurance would have to pay more than $2,200 out of pocket for a month’s treatment with Zaltrap.”

To read the remainder of this article, go to Pharmalot.

Ed Silverman is the editor of Pharmalot and a contributor toYCharts Pro Investor Service which includes professional stock charts, stock ratings and portfolio strategies.

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