At the Intersection of Health, Health Care and Policy Cite this article as: Scott Ramsey What Do We Want From Our Investment In Cancer Research? Health Affairs, , no. (2005): doi: 10.1377/hlthaff.w5.r101
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Perspective What Do We Want From Our Investment In Cancer Research? A departure from the focus on how much money Americans spend to defeat cancer. by Scott Ramsey ABSTRACT: U.S. spending for cancer is increasing rapidly, because of the aging society, greater use of screening services, and new treatments that come with very high price tags. In this Perspective I argue that projections of the impact of medical innovation on health care budgets are not only difficult but ultimately meaningless. Rather than focusing on cost, the research and policy communities should consider a value-based approach towards developing and adopting cancer therapies, whereby innovations in cancer are viewed by gains in survival and reduced morbidity relative to their price.
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h y s h o u l d w e invest in cancer research? More than thirty years ago President Richard M. Nixon answered this question by saying that the need for a national cancer program “springs from fear and hope”—fear of suffering that cancer brings to patients and their families, and hope that the research community would be able to find ways of preventing and treating cancer.1 Interestingly, President Nixon also cautioned that “we must put on the armor of patience,” because finding a cure for cancer “wouldn’t come quickly.” Today cancer is still feared, and we continue to hope for breakthroughs, but we have also added a new paradigm to the cancer research agenda: “Curing” cancer will save our health care system from going bankrupt. Should we worry about cancer bankrupting the system? Certainly, we can expect to see an increase in the number of Americans with cancer as the U.S. population ages. Cancer has already replaced heart disease as the leading
cause of death in the United States, in part because of the aging society and improvements in the prevention and treatment of coronary artery disease. Cancer is also getting much more expensive to treat. One well-known reason is that most “breakthroughs” come with a very high price. Several recently approved chemotherapy agents for cancer come with price tags that are 300–500 percent higher than the costs of traditional treatments.2 We are also treating more intensively, with greater use of combination chemotherapy regimens, second- and third-line therapies for those who fail to respond to initial treatment or relapse, and posttreatment chemoprophylaxis (such as tamoxifen after successful treatment of early-stage breast cancer).3 A less-discussed reason has to do with national trends in cancer incidence and survival. Stage-specific survival rates have increased for many cancers, albeit modestly, during the past ten years. Although this is, of course, desirable,
Scott Ramsey (
[email protected]) is a full member at the Fred Hutchinson Cancer Research Center in Seattle, Washington.
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it raises the lifetime costs of care, since treat- implausible, but this does not appear to be the ment and monitoring costs are prolonged. point; rather, the authors wish to show readers Moreover, a greater percentage of eligible peo- that even in the best of all possible worlds ple are participating in cancer screening pro- (that world appears to contain an amazingly grams. While cancer screening identifies more low-price vaccine that prevents cancer from people at earlier stages of cancer (where cures ever developing), Medicare outlays per capita or improved survival are possible), it also in- barely budge. creases the number of cancer survivors (with How could this be? The answer, of course, their attendant ongoing care and surveillance is that people who are spared from a cancer costs). We also now recognize that screening death go on to develop and die from other disproduces an “overdiagnosis” problem; that is, eases, and the cost of treating those conditions cancers found through is also rising. To paraphrase screening that would have John Maynard Keynes, in the “I suggest that we otherwise never have been dilong run, we are all expensive shift our focus away agnosed before the person before we die, and there from the cost of died from other causes. Of seems to be no way around it. cancer innovations course, once someone is told Let me now introduce an that he or she has cancer, apparently radical thought to and instead consider most will choose treatment, this discussion: Let’s stop what types of and this will be costly. This worrying about how much innovations do we appears to be a particular money we spend on cancer. want cancer problem for prostate cancer, Americans continue to supresearch to pursue.” the most common cancer port cancer research, and noamong men, although it albody really expects that the most certainly occurs in every fruits of that research to be other cancer for which we screen.4 Overdiag- inexpensive.9 I would certainly pay handnosis is one reason why policy analysts con- somely to never have to worry about dying template whether it is desirable to establish from cancer, and I suspect that most others stopping ages for cancer screening technolo- would as well. Furthermore, it is not at all gies.5 clear that future advances in cancer treatment Perhaps given all of these trends, no one technologies will break anyone’s bank. Yesterwould be surprised to learn that direct medi- day’s breakthroughs certainly have not. In cal care spending for cancer care increased spite of changing demography, the share of from $96.1 billion in 1990 to $189.8 billion in cancer care among all personal health expen2004 (in inflation-adjusted dollars).6 Worried, ditures has actually fallen over time, from 4.96 but not surprised. How will Medicare—the percent in 1971 to 4.50 percent in 2005.10 primary health insurer for 56 percent of all I suggest that we shift our focus away from Americans who are diagnosed with cancer the cost of cancer innovations and instead coneach year—continue to pay for cancer care if sider a more fundamental question: What the costs of treating it nearly double every fif- types of innovations do we want our cancer reteen years?7 search infrastructure to pursue? Given that we This leads us to the paper by Jay cannot control the pace of cancer research or Bhattacharya and colleagues on how various easily predict where the breakthroughs will scenarios for technological changes in cancer occur, a portfolio of investments in several care might influence future Medicare spend- promising areas seems prudent. Traditionally ing.8 The authors consider five separate sce- and today, the great bulk of cancer research at narios for technological change, which range the National Institutes of Health (NIH) and in from “wide-eyed optimism” to “excessive pes- the pharmaceutical industry has been directed simism.” From my perspective, are all equally toward treating cancers that are clinically di-
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agnosed, usually at relatively advanced stages. Opinion leaders are now questioning the wisdom of that strategy.11 Specifically, the National Cancer Institute (NCI) and others are now funding major initiatives to identify cancer at its earliest and most curable stage. These range, for example, from basic research in identifying serum biomarkers indicating that an early cancer is developing to a large clinical trial of computed tomography (CT) scanning to detect early-stage lung cancers.12 Although the dollars directed toward these initiatives are very small compared with the NIH’s overall cancer research budget, they do represent an important shift in focus for the agency. In designing a research portfolio, one might want to consider the potential cost-effectiveness of different technologies under development. Here, Bhattacharya and colleagues’ “wide-eyed” optimistic scenarios prove illuminating. Thinking now in terms of years of life gained as well as additional dollars spent, we find from their analysis that some hypothetical technologies provide far more value than others, when measured as marginal costs per year of life gained. In their analysis, cancer vaccines and early detection appear to provide the best potential value, although I caution that their assumptions regarding the cost of these technologies ($100 per vaccine and $0–$118 for early detection) are far too optimistic to enable one to put great faith in their value relative to the other options. Finally, it is important to step back and consider all medical technology growth and the future financial solvency of Medicare. The pace of real spending growth in Medicare is now outstripping general productivity growth in the economy. Given current trends, Medicare spending will greatly exceed revenues in less than fifteen years.13 Most economists agree that technological innovation is the primary driver of the increase in medical care spending. Of course, rapid technological growth is occurring throughout medicine, not just in cancer. Medicare and the federal government are thus facing a future in which they will have to reduce benefits, raise beneficiaries’ premiums, or increase general taxes to support the pro-
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gram. In all likelihood, federal legislators and administrators will decide to employ a combination of these unpleasant remedies. This means that many patients may be unable to access potentially beneficial new cancer technologies, because of coverage restrictions. This fundamental problem has not yet been addressed by policymakers, and it is almost a taboo subject among those in the cancer research and practice communities. Many have argued that Medicare will eventually have to adopt a cost-effectiveness model of rationing coverage, whereby new technologies offering the most health value for expenditure are covered, while others with positive benefits but poor value are not.14 There are signs that Medicare is preparing to use cost-effectiveness information for reimbursement decisions. For example, the Medicare Pay ment Adv isor y Commission (MedPAC) recently offered suggestions for how Medicare could incorporate independent cost-effectiveness analysis into its coverage process.15
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a n c e r b r e a k t h r o u g h s will not save Medicare’s financial picture. However, it is in the interest of both the cancer research and practice community to engage policymakers as they consider methods to encourage the development and adoption of innovations that offer the most health value for expenditure, while discouraging adoption of those that offer poor value. The views provided are solely those of the author.
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R.M. Nixon, “Statement about Proposed Legislation to Establish a National Cancer Program,” 11 May 1971, www.nixonfoundation.org/Research_ Center/1971_pdf_files/1971_0164.pdf (1 August 2005). D. Schrag, “The Price Tag on Progress—Chemotherapy for Colorectal Cancer,” New England Journal of Medicine 351, no. 4 (2004): 317–319. Deborah Schrag notes that the Mayo Clinic regimen (fluorouracil and leucovorin) costs $63, but FOLFOX combined with bevacizumab (Avastin) costs $21,033. See also M. Herper, “Cancer’s Cost Crisis,” Forbes, 8 June 2004, www.forbes.com/ technology/2004/06/08/cx_mh_0608costs.html (1 August 2005). For example, the use of chemotherapy for advanced-stage lung cancer increased from 21 percent to 42 percent between 1994 and 1999. See S.D. Ramsey et al., “Chemotherapy Use, Outcomes, and Costs for Older Persons with Advanced Non-Small-Cell Lung Cancer: Evidence from Surveillance, Epidemiology, and End Results—Medicare,” Journal of Clinical Oncology 22, no. 24 (2004): 4971–4978. R. Etzioni et al., “Overdiagnosis Due to ProstateSpecific Antigen Screening: Lessons from U.S. Prostate Cancer Incidence Trends,” Journal of the National Cancer Institute 94, no. 13 (2002): 981–990; and O. Davidov and M. Zelen, “Overdiagnosis in Early Detection Programs,” Biostatistics 5, no. 4 (2004): 603–613. K. Kerlikowske et al., “Screening Mammography in Elderly Women,” Journal of the American Medical Association 283, no. 24 (2000): 3202–3204. M.L. Brown, J. Lipscomb, and C. Snyder, “The Burden of Illness of Cancer: Economic Cost and Quality of Life,” Annual Review of Public Health 22 (2001): 91–113; and National Heart Lung and Blood Institute, Fact Book, Fiscal Year 2003, February 2004, www.nhlbi.nih.gov/about/03factbk .pdf (1 August 2005). Based on data showing the age distribution of cancer incidence, 1999 to 2002. See National Cancer Institute, SEER Cancer Statistics Review, 1975–2002, “Table I-10: Age Distribution (%) of Incidence Cases by Site, 1998–2000,” seer.cancer .gov/csr/1975_2002/results_merged/topic_age_ dist.pdf (1 August 2005). J. Bhattacharya et al., “Technological Advances in Cancer and Future Spending by the Elderly,” Health Affairs, 26 September 2005, content.health affairs.org/cgi/content/abstract/hlthaff.w5.r53. Our patent system is designed to guarantee that developers receive monopoly profits for their medical innovations. Economists caution that expecting profit-seeking firms to price their new
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products at or below production costs is simply a pipe dream. See R. Frank, “Looking for Truth in All the Wrong Places,” Medical Care 43, no. 8 (2005): 751–752. Brown et al., “The Burden of Illness of Cancer.” R. Etzioni et al., “The Case for Early Detection,” Nature Reviews: Cancer 3, no. 4 (2003): 243–252; and C. Leaf, “Why We’re Losing the War on Cancer—and How to Win It,” Fortune 149, no. 6 (2004): 76–91. Many NIH-sponsored initiatives in proteomics are reviewed in National Cancer Institute, Center for Cancer Research, “NCI-CCR Initiatives, Proteomics,” ccr.cancer.gov/initiatives/ proteomics.asp (1 August 2005); and NCI, “NLST (National Lung Screening Trial),” cancer .gov/nlst (1 August 2005). For a summary discussion of Medicare growth relative to gross domestic product (GDP) growth and the threat it poses for Medicare solvency, see M. Pauly, “What If Technology Never Stops Improving? Medicare’s Future under Continuous Cost Increases,” Washington and Lee Law Review 60, no. 4 (2003): 1233–1250. Also see 2005 Annual Report of the Boards of Trustees of the Federal Hospital Insurance Trust and Federal Supplementary Medical Insurance Trust Funds, www.cms.hhs.gov/publications/ trusteesreport/tr2005.pdf (1 August 2005). A.M. Garber, “Cost-Effectiveness and Evidence Evaluation as Criteria for Coverage Policy,” Health Affairs, 19 May 2004, content.healthaffairs.org/ cgi/content/abstract/hlthaff.w4.284 (1 August 2004); and U.E. Reinhardt, “An Information Infrastructure for the Pharmaceutical Market,” Health Affairs 23, no. 1 (2004): 107–112. See Chapter 8, “Using Clinical and Cost Effectiveness in Medicare,” in Medicare Payment Advisory Commission, Report to the Congress: Issues in a Modernized Medicare Program (Washington: MedPAC, 2005).
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