Why does Herceptin cost so much?

[JanH]

Since the latest judgment was made I've been googling around it - given the price I'm not surprised to find that the manufacturer is Roche.

Leaving aside the issue of whether many of the women who believe they need it will actually be helped by it - some very informative links at spiked - it is infuriating to read (following the Barbara Clark case):

"The beneficiaries of the trastuzumab case are immediately apparent. Patricia Hewitt showed the characteristic cynicism of New Labour, making a populist gesture in response to consumer demand without regard for the wider consequences for the NHS or its patients. Roche will make a vast profit from the sales of trastuzumab, claiming that costs of 'R&D' justify its extraordinary price."

Roche also claim that "if given early in the course of the disease, it can save 1000 lives a year." (It's still only licensed for advanced breast cancer). At £20,000 a year per patient that's £20m a year just from that 1000 - never mind the ones not saved, and the ones given it for late-stage cancer - and that's just in this country.

Of course pharmaceutical companies are in the business to make money, and they "only" have 20 years exclusivity from taking out a patent, but they make such vast profits you'd think they could stretch a point and charge a more reasonable amount for a product like this which they are promoting so hard. It would be interesting to know exactly what the R&D figure is, too (haven't come across that yet).

[acnebride]

a relative of mine has been a research chemist for 20 years on a good salary (don't know how much, never asked him). Nothing he has worked on has ever made it to market. Many things have made it to stage 1 or 2 trials, and some to stage 3 (human beings) but none have got beyond that. And I don't think he's useless at his job or anything

Just a comment re the R&D costs of drugs.

[tamum]

I don't know anything much about R and D, but I can tell you this much. It's a monoclonal antibody, and they are genuinely hideously expensive to make and characterise because they are biological reagents rather than chemicals. If I was to get one made by CRUK in small quantities for research, nowhere near pure enough for human treatment, and nowhere near enough for one person, it would cost about £3000-4000, whereas chemical drugs for use in research would be more like under a hundred (varies enormously of course).

[JanH]

Oh, I see what you mean, ab - but they must allocate R&D costs to particular projects, mustn't they, even when initial research comes to nothing? It would still be interesting to see a figure like that for Herceptin.

I used to work for Beecham Pharmaceuticals in the 70s, when they still had various derivatives of ampicillin under patent (amoxil, floxapen, magnapen etc) and they were making obscene profits on those.

[JanH]

I was hoping you would reply, tamum! So are you saying £20K pa is reasonable, or not?

[swoon] at

[acnebride]

Yes, they surely must allocate R&D costs to particular projects, but also 1 drug on the market has got to cover the costs for X number of R&D projects that get nowhere - as well as lots of nice food for GP lunches etc well actually more of a

[tamum]

Well, I honestly have no idea whether 20K per year is reasonable- they must be making a stonking profit, but I can see that the costs must have been much higher than for a chemical drug. I have been to two cancer conferences recently where there has been great disquiet over all this- not just medics complaining about patient power at all, but great concern about other budget cutbacks for other areas of oncology.

[Tinker]

Yes, I was swooning at "biological reagents rather than chemicals" as well. Of course!

[tamum]

[Tinker]

[GDG]

Acnebride - pharma companies are a lot more strict about 'wining and dining' the health professionals nowadays - budgets are tight for this and very restricted. Reps have to log and justify everything that they spend. I've heard lots of doctors mention this actually 'oh they don't seem to be taking me out as much as they used to'.

[LovelyBigMuvverers]

You truly can ask any question you want and get an intelligent answer on MN, can't you? (Not from me, I hasten to add - with a name like mine... ).

[GDG]

Tamum - just remind me what you do (if you don't mind - don't answer if you don't want to!) - I just remember that you are a 'scientist' but never very sure what you do exactly!

[tamum]

I'm an academic GDG- geneticist by training, and that's what I lecture in, but my research is mainly cancer biology

[GDG]

Wow - sounds interesting!

[DominiConnor]

What caught my eye was actually how small the cost was, not how large.

20K is a lot compared to average wages but compared to many other treatment regimes is not absurdly high.
It's smaller than (say) dialysis, which requires staff, expensive equipment, and drugs as well.

I had look at the British Heart foundation, and found that pretty much anything starts at around 10K and goes up quickly. From their numbers it's hard to see any heart patient costing less than 20 once you factor in post surgical care, and yes they pop loads of drugs as well.

It's a difficult one for drugs. One the one hand Roche are a Swiss company, and thus have rather different ethics to other people. They've been caught committing any number of criminal acts with respect to their pricing.
On the other hand most drug research fails. Without products that win big, the drug companies would go out of business. When we look at the their profits they don't look anything special and when adjusted for the risks, they look like quite poor investments.

My take on this, is that is actually someone playing politics. No way would this have happened with an AIDS treatment, but someone wanted to make the health minister look stupid, and the government wants to look tough in it's negotiations with drug companies.
NICE is set up in a stupid way, that seems almost designed to add as much delay as possible, since it cannot begin a cost/benefit evaluation until a licence is granted. That may be rational sometimes, but as an absolute rule it sucks. Unless you want to slow the uptake of expensive drugs regardless of the effects on patients.

Also of course, it would have been far cheaper for the trust to pay for this woman than the horde of lawyers. Thus we can be sure that at least one group is trying to prove a point.

[JanH]

Thank you very much for that, DC - we don't normally see costs for treatment of major illness, do we? Maybe the NHS should publish annual cost tables so we have a basis for comparison.

I wonder how come the media (all of them, AFAIK, regardless of political leaning) continued to make it sound as if £20K is a huge amount instead of putting it into perspective.

Does anyone know how much tamoxifen costs annually? That has to be taken for c 5 years after diagnosis and I think Herceptin does too?

[chapsmum]

Tablets, tamoxifen 10 mg, net price 30-tab pack = £1.97; 20 mg, 30-tab pack = £2.24; 40 mg, 30-tab pack = £8.42

have no idea what its cummulative total would be..
But mose doses of this cost less to the nhs than they charge for a prescription so I imagine (and this is purely IMO not based on anything else and please correct me if I'm wrong)
I would imagine that for outpatient use the cost of tamoxifen would bve minimal.

[Blandmum]

Oh the costs. they are astonishigly high.

Part of the reason is that the company has the patent for 20 years.....that seems like a long time, but in reality you patent it while it is still very early on in development.....you don't want someone to beat you to a new drug IYSWIM

When I worked for the industry 10 years ago it was estimated that it normaly took 14 years from first getting a cemical patented to getting it to market. So in actual fact you only have 7 'money making' years of patent left

as as Tamum says this is a monocolnal antibodym in effect tailored to the specific patient and their tumour....so even more expensive

10 years ago it was estimated that it cost £100, 000, 000 to get a drug to market. Only one in three drugs is estimated to get back its development costs. A mate working in the industry now says the cost is now closer to £1000, 000, 000.....I trust him implicity but can't verify this for myself.

And these are 'normal' chemical drugs. New things like Herceptin are even more difficult to produce and consequently even more expensive.

I worked in a very early monocolnal antibody treatment, which was used to help prevent tissue rejection....the licencing for that was hideous as it was such a new type of drug, and the CSM , rightly, wanted full documentation that it was 'safe' to use.

the licencing document for ibufrofen in the 1960s was 400 pages long

Current licence application take a Pantecnicon lorry to take them to the CSM. Drugs raise a lot of cash, but costs are aslo vast and the risks of failure high

[Tinker]

This is all fascinating. Never thought I'd ever begin to feel sympathy for a drugs company.

[Blandmum]

well, don't! they make enough money!

But it is a very high risk/ high profit enterprise. And they are in it to make cash....make no bones about it. That is why viagra was dicovered before a cure for tropical sores. No money in treating the diseases of the poor.

But while they are at it, they do cure people and make their lives better.