How much will Provenge cost? A few analyst chime in

[Guest guest]

Looks liek the estimate os between $40 and $100khttp://www.xconomy.com/seattle/2010/04/14/dendreons-big-question-how-much-will-people-pay-for-provenge/

-- Emersonwww.flhw.orgEvery 2.25 minutes a man is diagnosed with prostate cancer.Every 19 minutes a man, dies from the disease.

[Guest guest]

Emerson wrote:

> Looks like the estimate is between $40 and $100k

http://www.xconomy.com/seattle/2010/04/14/dendreons-big-question-how-much-will-p\

eople-pay-for-provenge/

That's a fascinating article about the economics of drug pricing

and the interplay between market forces (just how much are you

willing to pay to stay alive), demand (if we can't make enough

for everyone, let's raise the price to lower demand) insurance

(what if the cost is invisible to you - it just shows up in

higher premiums for everyone), FDA drug labeling and insurance,

development cost, etc.

Surprisingly, I saw nothing in the article about the

manufacturing cost of the drug. If I remember correctly, it's a

very expensive drug to make. Each batch is made by using immune

cells and cancer cells from the individual patient's body. So it

can't be made in a factory and shipped out to doctors or

pharmacies. Again, IIRC, a blood sample is taken, cultured under

various complex conditions for about a week, processed in various

ways, then injected back into the patient. So the actual cost of

the drug, apart from recovery of R & D costs and profits, is many

thousands of dollars for one treatment.

I have a theory about drug prices.

In the short run, I expect new drugs to get more and more

expensive. In the long run I expect them to get cheaper.

One obvious reason they'll ge cheaper is that, over time, more

and more powerful drugs go off patent and become generic. A

perhaps less obvious one that I hope will also apply is that the

biological research, development and manufacturing techniques for

new drugs will be continually developed and refined, becoming

cheaper in the process. For example, the first full human genome

sequence cost about $70 million. Today it's in the thousands and

may soon be in the hundreds. This is all in a period of less

than 15 years.

I'm optimistic.

Alan

[Guest guest]

Another thing to consider is total cost of treatment. If a man

chooses treatment A he gets three treatments and then treatments stop but If a

man get treatment B that continues over a long period of time with more

treatments given, cost for an individual treatment may be higher but what

would the difference be for a course of treatment? Not sure how Provenge will

be used but if it eventually is used rather than chemo, it may be less

expensive over the long term and the side effects are expected to be significantly

less than chemo. Should there be a cost offset for QOL? What would be an

acceptable figure for that? Also if a man has to get additional drugs to

alleviate side effects, etc and does not need those if he gets Provenge, what

would the cost savings be?

Too often things are targeted of cost savings that appear to be

the most expensive if you look at a unit of one but may be seen differently if

looked at as part of the entire process. Medical cost savings is not

necessarily as easy as it seems.

Kathy

From:

ProstateCancerSupport

[mailto:ProstateCancerSupport ] On Behalf Of Alan Meyer

Sent: Wednesday, April 14, 2010 11:44 AM

To: ProstateCancerSupport

Subject: Re: How much will Provenge cost? A few

analyst chime in

Emerson

wrote:

> Looks like the estimate is between $40 and $100k

http://www.xconomy.com/seattle/2010/04/14/dendreons-big-question-how-much-will-people-pay-for-provenge/

That's a fascinating article about the economics of drug pricing

and the interplay between market forces (just how much are you

willing to pay to stay alive), demand (if we can't make enough

for everyone, let's raise the price to lower demand) insurance

(what if the cost is invisible to you - it just shows up in

higher premiums for everyone), FDA drug labeling and insurance,

development cost, etc.

Surprisingly, I saw nothing in the article about the

manufacturing cost of the drug. If I remember correctly, it's a

very expensive drug to make. Each batch is made by using immune

cells and cancer cells from the individual patient's body. So it

can't be made in a factory and shipped out to doctors or

pharmacies. Again, IIRC, a blood sample is taken, cultured under

various complex conditions for about a week, processed in various

ways, then injected back into the patient. So the actual cost of

the drug, apart from recovery of R & D costs and profits, is many

thousands of dollars for one treatment.

I have a theory about drug prices.

In the short run, I expect new drugs to get more and more

expensive. In the long run I expect them to get cheaper.

One obvious reason they'll ge cheaper is that, over time, more

and more powerful drugs go off patent and become generic. A

perhaps less obvious one that I hope will also apply is that the

biological research, development and manufacturing techniques for

new drugs will be continually developed and refined, becoming

cheaper in the process. For example, the first full human genome

sequence cost about $70 million. Today it's in the thousands and

may soon be in the hundreds. This is all in a period of less

than 15 years.

I'm optimistic.

Alan