How Much Are We Willing To Pay For Healthcare?

By Rob Wright, Chief Editor, Life Science Leader
Follow Me On Twitter @RfwrightLSL

Recently, Ten-year old Sarah Murnaghan, suffering from end-stage cystic fibrosis (CF), made national headlines when she received a double lung transplant. A feel good story, Murnaghan’s mother started a change.org petition and later sued on her behalf for changes to the current transplant rules. In August, Sarah went home after receiving not one, but two double lung transplant surgeries, as the first lung transplant proved unsuccessful. In addition to her lengthy hospital stay and two double lung transplant surgeries, the child underwent additional procedures resulting from complications, including a tracheostomy and a procedure to fix her paralyzed diaphragm.

The Cost Of Care

I have found it interesting that there has been little commentary as to the costs associated with Sarah’s healthcare, nor mention how half of all lung transplants fail within five years. A 2011 estimate for a double lung transplant conducted in the United States averages $797,300. When you consider she had not one, but two, plus the fact she was a high-risk pediatric case, legal fees, and costs for the additional procedures, a conservative estimate of $2 million is probably fairly reasonable. It makes me wonder how much as a society are we willing to pay for the future medical well-being of our children and other loved ones. As the case of Sarah Murnaghan demonstrates, we are willing to pay a great deal. Why then are we so quick to balk at paying for drugs?

The Price Of Innovation

In January 2012, Vertex gained approval for the first drug which treats the root cause of CF. Named Kalydeco, it took two decades to develop and required more than $75 million in outside funding. The twice-a-day pill costs $294,000, making it one of the most expensive medications of all time. Notice how I avoided incorporating adjectives to describe the cost of the medicine such as staggering, whopping, exorbitant, outrageous, unreasonable, ridiculous, or inflated. This is because I have yet to see Sarah’s two double lung transplants to be described as excessive or unreasonable, only “controversial.” Sarah’s treatment, which I am sure is much more painful than taking a pill twice a day, costs nearly seven times the cost of Kalydeco. This means a patient could have a double lung transplant and have a 50/50 chance of living past five years, or perhaps, take Kalydeco for about seven years and cost about the same. Eventually, the cost of the drug will drop substantially when it comes off patent. I imagine this is a day welcomed by insurance companies and patients alike. However, I think it is important to remember that without drug companies investing heavily in developing these drugs — which could lead to other significant breakthroughs and cures — there won’t be future generics.

Why Do We Blame Pharmaceutical Companies?

When I worked directly in the pharmaceutical industry, I would frequently hear complaints about the cost of medications. I would often ask, “Did it help,” or “Was it worth it?” The response was often, “Well what alternative did I have?” I would then ask, “What was your alternative?” I remember one person saying, “Death.” To which I replied, “Well I guess it was a pretty good investment.” It is painful for me to watch people fill a grocery cart up with branded potato chips and soda, and then be unwilling to pay a doctor’s co-pay for services rendered. This is why most offices have begun to collect the co-pay first. It is just as painful to sit at a high school football game and overhear someone talk about their relative needing a medication for treatment, complain that the insurance company (for the plan they selected) isn’t willing to cover the full cost of the medicine. The person listening empathized saying, “Damn pharmaceutical companies.” Why do we consider Sarah a brave little hero, but forget that if it weren’t for the likes of Alexander Fleming, we wouldn’t have penicillin? I hope Sarah lives a long and full life, as too the researchers working in labs around the world striving to discover treatments which could one day save your life.