WEBVTT - Miracle Drugs, Million Dollar Price Tags 0:00:00.160 --> 0:00:02.400 I got the little vial out and it's just like 0:00:02.560 --> 0:00:08.719 five milliliters of liquid gold. You know, it wasn't in 0:00:08.760 --> 0:00:11.640 the bottle because it was inside of our son. But 0:00:11.760 --> 0:00:15.640 I was just looking at that little bottle and teary eyed, 0:00:15.880 --> 0:00:19.360 you know, like, oh my goodness, it's so small, and 0:00:19.440 --> 0:00:23.640 yet it's been so big in our lives. And how 0:00:23.680 --> 0:00:26.440 do you put a price on that? I don't know. 0:00:27.720 --> 0:00:31.520 This is Cheryl Yoda. The liquid gold she's referring to 0:00:31.840 --> 0:00:35.040 is a medication called nusan Erson that saved the life 0:00:35.040 --> 0:00:36.640 of her eight year old son, Jace. 0:00:37.560 --> 0:00:40.560 His big thing right now is hunting. We've literally gotten 0:00:40.680 --> 0:00:43.280 up and he's been out for like an hour stalking 0:00:43.320 --> 0:00:45.480 around the backyard with his bow and arrow. 0:00:45.920 --> 0:00:48.480 He's practicing for when he's old enough to go deer 0:00:48.560 --> 0:00:51.720 hunting with his dad and big brothers. But back when 0:00:51.800 --> 0:00:54.800 Jace was a baby, Cheryl didn't think anything like that 0:00:54.840 --> 0:00:58.160 would ever be possible for him. When Jace was eight 0:00:58.240 --> 0:01:02.240 days old, he was diagnosed with rare genetic disease called SMA, 0:01:02.960 --> 0:01:07.760 or spinal muscular atrophy. SMA interferes with the brain's ability 0:01:07.800 --> 0:01:11.840 to communicate with muscles over time. People with the most 0:01:11.880 --> 0:01:15.800 severe form of the disease like Jace lose the ability 0:01:15.880 --> 0:01:20.120 to swallow and breathe. Doctors told Cheryl it was unlikely 0:01:20.240 --> 0:01:25.240 Jace would live to see his second birthday. Sadly, Cheryl 0:01:25.280 --> 0:01:29.520 was already familiar with SMA before Jace. She'd given birth 0:01:29.560 --> 0:01:33.320 to two boys who didn't have SMA and a daughter, Ariel, 0:01:33.520 --> 0:01:37.160 who did. Ariel died when she was fifteen months old, 0:01:37.920 --> 0:01:42.720 and after learning about Jace's diagnosis, she thought he would too. 0:01:42.880 --> 0:01:46.920 It just felt like he had received basically a death sentence, 0:01:46.920 --> 0:01:50.120 and we were going to kind of enjoy him for 0:01:50.200 --> 0:01:52.360 a year and a half to two years and then 0:01:53.320 --> 0:01:55.760 try to help him be as happy and comfortable and 0:01:55.840 --> 0:01:58.240 have a great life as he could, and then have 0:01:58.320 --> 0:01:59.320 to say goodbye to him. 0:02:00.400 --> 0:02:03.600 Jace's doctor gave Cheryl a referral to see a pediatric 0:02:03.640 --> 0:02:08.440 neurologist at Johns Hopkins University School of Medicine. At the appointment, 0:02:08.639 --> 0:02:12.000 Cheryl says, the doctor gave Jason an exam and then 0:02:12.040 --> 0:02:14.359 asked her and her husband how soon they could get 0:02:14.360 --> 0:02:19.000 on an aeroplane. The doctor explained there was a clinical 0:02:19.040 --> 0:02:21.600 trial getting started for a drug that might be able 0:02:21.680 --> 0:02:25.520 to stop the symptoms of SMA from ever starting, and 0:02:25.760 --> 0:02:29.240 he said Jace would be a perfect candidate since he 0:02:29.360 --> 0:02:34.320 was still presymptomatic, but there were only twenty five spots open. 0:02:34.760 --> 0:02:36.920 They'd need to act fast and get to one of 0:02:36.960 --> 0:02:40.280 the research sites in a matter of days. Cheryl and 0:02:40.320 --> 0:02:43.400 her husband left the appointment completely shocked. 0:02:44.160 --> 0:02:47.320 Just feeling like we had received a gift a lake 0:02:48.000 --> 0:02:52.560 instead of walking out there with with options alike. You know, 0:02:52.760 --> 0:02:54.560 when do you want Haspers to come out. 0:02:54.440 --> 0:02:55.040 And visit you? 0:02:55.280 --> 0:02:58.360 That kind of thing we were talking about him living. 0:03:01.440 --> 0:03:04.519 They flew from Baltimore to Chicago later that week, where 0:03:04.600 --> 0:03:08.919 Jace was screened for the clinical trial and selected. Jace 0:03:09.040 --> 0:03:12.160 was given four doses of new Sinerson over the course 0:03:12.200 --> 0:03:15.560 of a few weeks. Cheryl learned that he'd need another 0:03:15.639 --> 0:03:19.679 dose every four months, probably for the rest of his life. 0:03:19.880 --> 0:03:22.040 By the time Jace was one and a half in 0:03:22.120 --> 0:03:26.799 December twenty sixteen, he still wasn't showing any SMA symptoms. 0:03:27.440 --> 0:03:32.520 Cheryl was overjoyed. Then, two days before Christmas, the rest 0:03:32.560 --> 0:03:36.640 of the SMA community rejoiced too. New Sinerson was approved 0:03:36.680 --> 0:03:39.920 by the FDA. That meant the drug treatment would become 0:03:39.960 --> 0:03:43.440 available to more people, even if they weren't enrolled in 0:03:43.480 --> 0:03:51.360 a clinical trial, But one week later, the joy turned 0:03:51.400 --> 0:03:56.120 to outrage. Biogen, the drug company that manufactures the drug, 0:03:56.440 --> 0:04:00.400 issued an announcement of its own. The drugs trade name 0:04:00.440 --> 0:04:03.920 would be spin Raza, they said, and it would cost 0:04:04.160 --> 0:04:07.720 one hundred and twenty five thousand dollars per dose. 0:04:08.640 --> 0:04:12.080 I mean, now I pay anything, But then how can 0:04:12.120 --> 0:04:16.040 I pay anything? Like, how do I pay one hundred 0:04:16.040 --> 0:04:19.440 and twenty five thousand dollars a dose? Just get that 0:04:19.560 --> 0:04:21.920 out three times a year? That's impossible. 0:04:22.400 --> 0:04:26.880 At the time, Cheryl considered herself fortunate. Jase's costs was 0:04:26.920 --> 0:04:30.480 still being covered by the clinical trial, and the clinical 0:04:30.560 --> 0:04:34.920 trial kept getting extended and extended, but eventually it came 0:04:34.960 --> 0:04:38.000 to an end. Earlier this year when Jace turned. 0:04:37.839 --> 0:04:41.880 Eight, and I did have those thoughts like, oh my goodness, 0:04:42.120 --> 0:04:45.080 now what Like I need to get on the ball 0:04:45.160 --> 0:04:48.839 and start researching. Maybe there are other studies we could 0:04:48.880 --> 0:04:51.360 be in. I need to talk to our insurance and 0:04:51.400 --> 0:04:54.120 find out if they'll cover this drug and that kind 0:04:54.160 --> 0:04:59.360 of thing. And I just started feeling overwhelmed, like I'm 0:04:59.360 --> 0:05:03.359 not that sad, I'm not that organized. How am I 0:05:03.520 --> 0:05:04.599 ever going to do all of this? 0:05:07.800 --> 0:05:11.359 I'm Laurena Rora Hutchinson. I'm the director of the Ideas 0:05:11.440 --> 0:05:16.440 Lab at the Johns Hopkins Berman Institute of Bioethics. In 0:05:16.480 --> 0:05:21.000 today's episode, Miracle Drugs, Modern medicine has been on the 0:05:21.040 --> 0:05:25.200 cusp of a revolution for years. There's a growing list 0:05:25.240 --> 0:05:28.080 of drugs that can save lives and cure diseases like 0:05:28.279 --> 0:05:33.119 never before. But the price for these medications can reach 0:05:33.240 --> 0:05:37.880 six and even seven figures, raising high stakes ethical questions 0:05:37.920 --> 0:05:43.200 about access and regulation from Pushkin Industries and the Johns 0:05:43.200 --> 0:05:54.039 Hopkins Berman Institute of Bioethics. This is playing God. Jays 0:05:54.080 --> 0:05:57.640 got his first commercial dose of Spinraza this year, and 0:05:57.760 --> 0:06:01.520 Cheryl's insurance company covered the cost, but that's not how 0:06:01.560 --> 0:06:04.400 it works for all families. It can be a real 0:06:04.480 --> 0:06:08.400 issue getting insurance companies to cover high cost drugs like spinraza. 0:06:09.240 --> 0:06:12.560 Even when they do, there's no guarantee coverage will last. 0:06:13.240 --> 0:06:16.719 The best day of my career was December twenty third, 0:06:16.760 --> 0:06:20.200 twenty sixteen, when the drug was licensed by the FDA. 0:06:21.320 --> 0:06:23.800 The worst day of my career was December twenty seventh, 0:06:23.839 --> 0:06:26.440 twenty sixteen, when the price was announced. 0:06:27.160 --> 0:06:31.200 Tom Crawford is a pediatric neurologist at Johns Hopkins University 0:06:31.279 --> 0:06:34.960 School of Medicine. He's been caring for children with spinal 0:06:35.080 --> 0:06:39.120 muscular atrophy for over thirty years, and he's very familiar 0:06:39.160 --> 0:06:42.839 with the challenges his patient's face. It was Tom who 0:06:42.839 --> 0:06:45.680 told Cheryls she should try to get jase enrolled in 0:06:45.680 --> 0:06:46.159 the trial. 0:06:46.800 --> 0:06:49.560 I couldn't you know. I was over the top. Oh 0:06:49.560 --> 0:06:51.360 my god, we have this therapy. It's going to work. 0:06:51.360 --> 0:06:53.720 And then four days later, one hundred and twenty five 0:06:53.760 --> 0:06:56.760 thousand dollars a dose, six doses for the first year 0:06:56.760 --> 0:06:59.520 of life, three doses every year thereafter. Oh my god, 0:06:59.680 --> 0:07:01.600 none of our patients are ever ever going to be 0:07:01.640 --> 0:07:03.719 able to pay for it. It's been snatched away from 0:07:03.720 --> 0:07:07.160 me in all my patients. Then I learned that the 0:07:07.240 --> 0:07:09.800 drug companies were really, really smart. They realized that that 0:07:09.960 --> 0:07:13.320 no insurance company is going to let a baby die 0:07:13.480 --> 0:07:15.360 for one hundred and twenty five thousand dollars, and they 0:07:15.400 --> 0:07:21.480 would approve the authorization. And so what the new barrier 0:07:22.160 --> 0:07:25.520 is now not just the price, but the authorization's getting 0:07:26.160 --> 0:07:29.760 the insurance companies to realize that this child is indeed 0:07:29.840 --> 0:07:33.720 eligible and falls into the criteria that were used to 0:07:34.080 --> 0:07:37.040 prove that it works. But now there's a whole game 0:07:37.080 --> 0:07:41.760 going on because insurance companies will try to not authorize 0:07:41.760 --> 0:07:45.200 if possible, if the child's not exactly in the group 0:07:45.240 --> 0:07:47.760 of patients than which the experiment was on, they'll say 0:07:47.800 --> 0:07:52.320 it's an unproven therapy, and frankly, they're right, because we 0:07:52.560 --> 0:07:55.240 proved it on a very narrow group of kids that 0:07:55.440 --> 0:07:57.960 in which the benefit could be seen as quickly as possible, 0:07:57.960 --> 0:08:00.520 because we wanted to get the drug out, And so 0:08:01.400 --> 0:08:05.440 the shift in getting drugs to patients that would make 0:08:05.440 --> 0:08:09.280 a difference to them has now shifted from science to 0:08:09.960 --> 0:08:15.880 clinical authorizations and letters and pleadings and newspaper articles. This 0:08:15.920 --> 0:08:18.000 is a different landscape than I would have ever imagined. 0:08:18.800 --> 0:08:20.520 So I'd like to just zoom out here and cover 0:08:20.600 --> 0:08:23.360 some of the basics. For people that don't really know 0:08:23.360 --> 0:08:26.720 anything about SMA, could you just tell us what sm is. 0:08:27.080 --> 0:08:30.520 Spinal muskro atrophy is a rare disease, but it's more 0:08:30.720 --> 0:08:34.800 common than people realize. It's actually, before these new therapies, 0:08:34.920 --> 0:08:38.040 was the most common genetic cause of death and infants 0:08:38.320 --> 0:08:42.040 that would kill about one in ten thousand babies. It 0:08:42.040 --> 0:08:46.400 affects all children of all races around the world with 0:08:46.600 --> 0:08:50.840 roughly equal prevalence. It's a disease that affects essentially the 0:08:50.880 --> 0:08:54.240 motor system, the muscles, and so babies who are born 0:08:54.320 --> 0:08:58.040 with it look normal initially for the most part, and 0:08:58.080 --> 0:09:00.559 then somewhere around two three four months of age, they 0:09:00.559 --> 0:09:02.760 start to get weaker and weaker and weaker, to the 0:09:02.800 --> 0:09:06.000 point where the muscles of breathing no longer work. As 0:09:06.040 --> 0:09:09.439 near as we can tell, they are completely normal cognitively, 0:09:10.600 --> 0:09:13.720 and it's a genetic disease, but it's a recessive genetic disease, 0:09:13.880 --> 0:09:16.600 so when it happens, they don't have a family history. 0:09:16.600 --> 0:09:19.640 For the most part, it's a surprise, and it comes 0:09:19.640 --> 0:09:23.000 because both parents were carriers for it. The other thing 0:09:23.040 --> 0:09:26.520 that's kind of interesting about SMA is that it exists 0:09:26.520 --> 0:09:30.560 for some complicated genetic reasons across the spectrum, so that 0:09:30.640 --> 0:09:32.640 there are the babies two thirds of them are the 0:09:32.640 --> 0:09:35.439 babies that are going to succumb by twelve or fifteen 0:09:35.480 --> 0:09:39.040 months of age, but the other third are milder forms 0:09:39.440 --> 0:09:41.600 that show up a little bit later and are milder, 0:09:41.760 --> 0:09:45.000 and at the mildest end you have adults who are 0:09:45.120 --> 0:09:48.559 troubled by the fact that they can't go upstairs as 0:09:48.600 --> 0:09:50.760 well as they would want to otherwise. So it's an 0:09:50.800 --> 0:09:56.120 absolutely continuous spectrum of decreasing instance to milder and milder expression. 0:09:58.360 --> 0:10:00.960 So could you tell me about y connection to Jace 0:10:01.040 --> 0:10:01.959 and Cheryl Yoda. 0:10:02.480 --> 0:10:05.880 Jace and his mom are my friends now. I first 0:10:06.000 --> 0:10:10.240 met Cheryl and jeremy mom and dad when I cared 0:10:10.280 --> 0:10:13.400 for the first baby, Ariel, and I have over here 0:10:13.640 --> 0:10:16.120 a picture of Ariel. She lived to be fifteen months 0:10:16.120 --> 0:10:19.480 of age, and we did the best possible. A few 0:10:19.559 --> 0:10:23.440 years later, Jace was born and so they brought him 0:10:23.440 --> 0:10:25.640 to me to see if this is what he had 0:10:25.760 --> 0:10:27.839 or not. It was right around that time that we 0:10:27.840 --> 0:10:30.320 were opening up a clinical trial of one of the 0:10:30.360 --> 0:10:34.840 new therapies called Spinoza now, and he was my first patient. 0:10:35.120 --> 0:10:38.440 So he got the dose, and I have a picture 0:10:38.559 --> 0:10:41.240 here as well. I'm looking at the most amazing day 0:10:41.280 --> 0:10:44.040 of my career. He was four months old and it 0:10:44.120 --> 0:10:47.880 was clear that he was getting stronger, not weaker, and 0:10:47.920 --> 0:10:50.240 it was one of the most goosebump moments of my 0:10:50.880 --> 0:10:55.480 entire life, like, we have a cure for a disease 0:10:55.520 --> 0:10:58.040 that used to kill babies, And so Jace over the 0:10:58.120 --> 0:11:00.600 years has gotten stronger and stronger, and it's still for 0:11:00.679 --> 0:11:03.280 me one of these goosebump moments to interact with him 0:11:03.280 --> 0:11:05.760 because he's alive. Oh my god. 0:11:05.960 --> 0:11:06.560 Yeah. 0:11:06.800 --> 0:11:11.360 I was taking care of babies that lose and now 0:11:11.520 --> 0:11:15.200 after this therapy, I get to be the person who 0:11:15.480 --> 0:11:19.440 helps them not And no one could ever imagine a 0:11:19.480 --> 0:11:23.120 career that goes from that to where we are now. 0:11:24.040 --> 0:11:27.520 It's a feeling, an unbelieval ecstasy that we can We 0:11:27.640 --> 0:11:30.480 don't have to do that anymore. I'm not burying babies. 0:11:31.960 --> 0:11:32.240 Wow. 0:11:32.400 --> 0:11:36.240 What an incredible shift. So I understand your research on 0:11:36.280 --> 0:11:39.960 how SMA works was crucial for developing the miracle drugs 0:11:40.000 --> 0:11:43.080 bin Rauser, as well as other drugs for SMA, and 0:11:43.120 --> 0:11:46.600 you were instrumental in designing the clinical trial to test spinraser. 0:11:47.000 --> 0:11:48.319 Could you tell me more about that. 0:11:49.000 --> 0:11:52.719 Yeah. So I had the privilege of being carrying for 0:11:52.920 --> 0:11:55.679 kids with SMA from the very beginning. I was very 0:11:55.720 --> 0:11:59.160 much involved in designing the clinical trials and the outcome 0:11:59.160 --> 0:12:03.280 measures necess to do the clinical trials. And then when 0:12:03.320 --> 0:12:05.920 we had this first idea with spin raza, I was 0:12:05.960 --> 0:12:09.640 the lead investigator here at Hopkins to give the drug 0:12:09.679 --> 0:12:11.560 and then follow how well, they do and see if 0:12:11.559 --> 0:12:14.840 there's any complications of it, and we've since studied quite 0:12:14.880 --> 0:12:17.040 a number beyond that to show that it has a 0:12:17.080 --> 0:12:20.720 broader effect and its benefit for this and the other 0:12:20.800 --> 0:12:21.680 drugs for SME. 0:12:22.559 --> 0:12:25.120 So, can you describe how drugs like spinraza work. 0:12:25.679 --> 0:12:30.400 Spin Rasa and the other therapies are high end therapies 0:12:30.400 --> 0:12:34.680 that are really designer for a very very specific mutation 0:12:34.960 --> 0:12:38.760 in a specific genetic defect, and as such a high 0:12:38.800 --> 0:12:41.000 effect therapy for rare disease. 0:12:41.440 --> 0:12:43.760 What sort of diseases can these therapies treat? 0:12:44.880 --> 0:12:49.440 Well? Right now they're targeting these mostly rare disorders, but 0:12:49.559 --> 0:12:53.120 we can imagine targeting many of the named diseases like 0:12:53.200 --> 0:12:57.640 cystic fibrosis or sickle cell disease or hemophilia. There's also 0:12:57.920 --> 0:13:01.920 the promise that we can extend this to extremely rare diseases, 0:13:01.960 --> 0:13:04.600 things that affect only a few people in the world 0:13:04.640 --> 0:13:07.040 at a time. And so when we know the mutation, 0:13:07.800 --> 0:13:10.720 there's the future prospect that we can design a drug 0:13:10.800 --> 0:13:15.840 for that mutation in that patient, which is just abtolutely awesome. 0:13:16.360 --> 0:13:17.960 It used to be the idea that we had to 0:13:18.040 --> 0:13:21.320 understand why a disease happened and now it looks like 0:13:21.360 --> 0:13:23.760 we have therapiest where we can skip over that step 0:13:24.160 --> 0:13:28.559 and repair or replace the specific abdamality at the very 0:13:28.640 --> 0:13:33.120 start by supplying something that was missing or undermining something 0:13:33.160 --> 0:13:34.160 that's doing damage. 0:13:34.960 --> 0:13:37.080 So one of the things we've heard is that drugs 0:13:37.120 --> 0:13:40.080 like spin rasa are incredibly expensive, and that part of 0:13:40.120 --> 0:13:42.439 what seems to drive the price of these miracle drugs 0:13:42.559 --> 0:13:45.400 is how much benefit they provide to the patient. But 0:13:45.480 --> 0:13:48.360 what happens to the price when for some patients the 0:13:48.400 --> 0:13:51.880 benefit is so much more than it is for other patients. So, 0:13:52.040 --> 0:13:56.320 for example, patients who have milder forms of SMA, the 0:13:56.360 --> 0:13:59.720 benefit might be less in comparison to patients who born 0:13:59.760 --> 0:14:01.320 with the more severe forms. 0:14:01.960 --> 0:14:05.199 This is the amazing quandary, and spinal must Gratupy shows 0:14:05.200 --> 0:14:08.440 this more than anything, because the price is sort of 0:14:08.480 --> 0:14:10.240 based upon the fact that a baby is going to 0:14:10.280 --> 0:14:14.920 live and have a full and impactful life. And what's 0:14:14.960 --> 0:14:20.680 that worth. Obviously it's worth everything. It's interesting that patients say, 0:14:20.760 --> 0:14:22.960 I'm not getting better. I'm not like that kid, the 0:14:23.040 --> 0:14:25.280 baby that got much better. I said, no, the baby's 0:14:25.280 --> 0:14:28.400 getting better because we stopped degeneration at a time when 0:14:28.440 --> 0:14:31.880 babies normally climb out of their mom's arms and run 0:14:31.920 --> 0:14:34.400 around and then and develop and do normally. So we 0:14:34.480 --> 0:14:37.600 allow that normal development to happen, But what's really happened 0:14:37.640 --> 0:14:40.800 is we stopped degeneration. And so if we wait to 0:14:41.120 --> 0:14:44.640 give the drug until after development has already accrued, they 0:14:44.680 --> 0:14:47.640 actually are not getting better. They're just not declining any further. 0:14:48.280 --> 0:14:51.440 And that's another place where the quandary between the insurance 0:14:51.480 --> 0:14:55.360 providers and the doctors and the patients are in clash 0:14:55.520 --> 0:15:02.520 because evidence is really hard to come by. Spinal weskiatvie 0:15:02.840 --> 0:15:06.760 is going to be the story of many of the 0:15:06.800 --> 0:15:09.120 diseases to come. So I think we can learn a 0:15:09.160 --> 0:15:13.920 lot from what's happened so far, and this tension is 0:15:13.960 --> 0:15:17.120 going to be a big issue in the next couple decades. 0:15:19.680 --> 0:15:22.120 Tom, thank you so much for joining us today and 0:15:22.200 --> 0:15:26.560 talking about this topic. Coming up after the break, we'll 0:15:26.560 --> 0:15:29.400 hear more about how these miracle drugs are priced and 0:15:29.400 --> 0:15:44.040 why accessing them is so difficult. Cheryl Yoda's experience of 0:15:44.080 --> 0:15:46.800 getting insurance to cover the cost of her son Jas's 0:15:46.840 --> 0:15:51.200 medicine is hardly typical. Holly Fernander's Lynch is a professor 0:15:51.240 --> 0:15:54.320 of medical Ethics and Law at the University of Pennsylvania. 0:15:55.080 --> 0:16:00.200 She focuses on access to investigational medicines, food and drug administration, policy, 0:16:00.560 --> 0:16:02.000 and gatekeeping in healthcare. 0:16:03.440 --> 0:16:06.600 I think equity is a huge challenge in this context. 0:16:06.720 --> 0:16:10.160 So do you have insurance in the first place? How 0:16:10.360 --> 0:16:13.880 high quality is the insurance coverage that you have access to. 0:16:14.520 --> 0:16:17.920 But there's a lot of important data showing that even 0:16:18.040 --> 0:16:21.840 people who have good insurance coverage are often unable to 0:16:22.040 --> 0:16:25.240 access these high priced medicines because their out of pocket 0:16:25.280 --> 0:16:29.920 costs are still so high. It's very few people who 0:16:29.920 --> 0:16:33.680 can pay tens of thousands of dollars for a drug, 0:16:33.760 --> 0:16:35.840 let alone, you know, the out of pocket costs for 0:16:35.880 --> 0:16:39.040 a million dollar or two million dollar drug. So equity 0:16:39.120 --> 0:16:40.480 is going to be a huge issue too. 0:16:41.120 --> 0:16:45.040 The price point for spinras that seems shockingly high to me. 0:16:46.400 --> 0:16:49.400 How do drug companies arrive at such high prices in 0:16:49.440 --> 0:16:50.160 the first place. 0:16:51.200 --> 0:16:54.120 So the way that you typically hear companies talking about 0:16:54.200 --> 0:16:57.360 this is based on the research and development costs, what 0:16:57.440 --> 0:17:01.080 it takes to actually bring these products to market. And 0:17:01.440 --> 0:17:04.080 in that context, they're not thinking just about the drug 0:17:04.119 --> 0:17:07.040 that ultimately got approved, but all the other drugs that 0:17:07.119 --> 0:17:11.360 failed along the way before they got to human trials 0:17:11.560 --> 0:17:15.360 or in earlier stages of clinical development, So that's certainly 0:17:15.480 --> 0:17:18.640 part of it. However, there has been quite a bit 0:17:18.680 --> 0:17:21.760 of research to demonstrate that it's not the R and 0:17:21.840 --> 0:17:26.119 D prices that are dictating price that's actually set for 0:17:26.240 --> 0:17:31.439 these drugs. It's market conditions. It's how much will the 0:17:31.480 --> 0:17:36.000 market bear. What ultimately happens is that pharmaceutical companies get 0:17:36.040 --> 0:17:39.240 to decide what the list price is going to be 0:17:39.280 --> 0:17:41.560 for their drug. They come onto the market with very 0:17:41.640 --> 0:17:45.280 high prices, and then payers have very little choice but 0:17:45.400 --> 0:17:47.280 to pay those prices. 0:17:47.720 --> 0:17:50.439 What about relative benefit, Well, the value of a drug. 0:17:50.920 --> 0:17:53.480 Does that get taken into account when setting the price. 0:17:54.240 --> 0:17:59.120 So value based pricing is really important. What impact are 0:17:59.160 --> 0:18:03.080 these drugs having on people's lives? In many cases, the 0:18:03.160 --> 0:18:06.119 drug price has no bearing on that. And that is 0:18:06.160 --> 0:18:10.720 where we really run into ethical challenges because if a 0:18:10.840 --> 0:18:14.959 drug is not very good, right, maybe it has a 0:18:14.960 --> 0:18:17.720 marginal benefit, then we can say, look, we shouldn't be 0:18:17.760 --> 0:18:20.560 paying high prices for that drug. But if a drug 0:18:20.600 --> 0:18:23.920 is a cure for a life threatening disease, especially a 0:18:24.040 --> 0:18:27.520 disease affecting children, the value is going to be really 0:18:27.600 --> 0:18:30.800 high right, sometimes in the realm of millions of dollars, 0:18:30.880 --> 0:18:33.119 and you might even say that those are cost effective 0:18:33.200 --> 0:18:36.119 drugs because it's going to reduce the lifetime costs that 0:18:36.160 --> 0:18:38.959 you might otherwise have to pay. So that's where those 0:18:39.000 --> 0:18:42.480 are some of the most ethically challenging issues because their 0:18:42.480 --> 0:18:45.919 cost effective, high value drugs. But if we had to 0:18:45.960 --> 0:18:48.600 pay for them for a lot of patients, we won't 0:18:48.640 --> 0:18:50.879 have enough money or resources to do that. 0:18:51.240 --> 0:18:53.480 So we had earlier in the episode that the price 0:18:53.480 --> 0:18:56.159 of spin Rouser was announced just after the drug was 0:18:56.160 --> 0:18:59.879 approved by the FDA. Does the FDA approval process have 0:19:00.080 --> 0:19:01.760 anything to do with the drug pricing? 0:19:02.359 --> 0:19:07.320 They are completely disconnected. When FDA approves a drug, it 0:19:07.359 --> 0:19:12.520 is evaluating only the safety and effectiveness of that drug. 0:19:13.320 --> 0:19:16.720 It has nothing to do with price. It doesn't even 0:19:16.760 --> 0:19:18.960 know what the price is because the price may not 0:19:19.040 --> 0:19:22.439 be publicly announced. Yet even if it did know, it 0:19:22.480 --> 0:19:28.280 could not take that into consideration. Once FDA approves a product, 0:19:28.640 --> 0:19:33.280 then we get into questions about drug pricing and coverage, 0:19:33.720 --> 0:19:36.160 and there's some debate about whether that's the right approach. 0:19:36.280 --> 0:19:38.119 So could you talk a bit more about that debate? 0:19:38.359 --> 0:19:41.639 What concerns does this rise from an ethics perspective. 0:19:41.640 --> 0:19:45.680 Yeah, the debate largely has to do with whose responsibility 0:19:45.840 --> 0:19:50.400 is it to consider price? And FDA is viewed as 0:19:50.440 --> 0:19:55.200 a science based agency. Their expertise is evaluating clinical trial 0:19:55.320 --> 0:20:00.280 data and evaluating is this drug strong enough that the 0:20:00.320 --> 0:20:04.040 statutory standard has been met? Can we feel confident that 0:20:04.119 --> 0:20:07.639 patients taking this drug the risk benefit ratio is going 0:20:07.680 --> 0:20:10.280 to be reasonable for them. The product then goes on 0:20:10.359 --> 0:20:14.280 the market, and if patients want to take it, then 0:20:14.440 --> 0:20:17.600 they need to find some way of paying for it. 0:20:17.800 --> 0:20:21.080 Many people will go to private insurance coverage to pay 0:20:21.560 --> 0:20:25.639 Lots of people are covered through government programs. Sometimes what 0:20:25.680 --> 0:20:28.240 you see happening is for these very high priced drugs, 0:20:28.280 --> 0:20:31.880 even if people have insurance coverage, they are crowd funding 0:20:32.280 --> 0:20:36.280 to pay for the out of pocket costs. And that's 0:20:36.320 --> 0:20:38.400 when you get people, you know, kind of pulling their 0:20:38.440 --> 0:20:41.320 hair out, like, how could it be in this highly 0:20:41.359 --> 0:20:45.080 privileged nation, we're asking people to go on the internet 0:20:45.200 --> 0:20:48.040 and ask their friends and family for money to pay 0:20:48.119 --> 0:20:53.040 for maybe life saving products, but certainly life affecting products. 0:20:53.119 --> 0:20:56.520 So can any federal agency set limits on drug pricing? 0:20:57.080 --> 0:21:00.680 There are lots of federal payers that are involved in coverage. 0:21:00.720 --> 0:21:05.480 So we have Medicare, Medicaid, and then the Veterans Administration, 0:21:05.800 --> 0:21:08.320 and they all are a bit different in what their 0:21:08.359 --> 0:21:12.000 statutory authority allows them to do. So you may have 0:21:12.119 --> 0:21:15.800 heard about the Inflation Reduction Act. It's a huge piece 0:21:15.800 --> 0:21:18.960 of legislation that has lots of components to it, two 0:21:19.000 --> 0:21:22.440 of which have to do with drug pricing. So for 0:21:22.480 --> 0:21:28.679 a very long time, Medicare was not allowed to negotiate price. 0:21:29.359 --> 0:21:31.680 So FDA would say this drug is safe and effective. 0:21:32.160 --> 0:21:35.480 Then Medicare had a decision to make is this drug 0:21:35.640 --> 0:21:40.120 reasonable and necessary for the Medicare population. So Medicare can 0:21:40.160 --> 0:21:44.680 say it's not reasonable and necessary or it is. They 0:21:44.680 --> 0:21:46.760 have an on off switch, are we going to cover 0:21:46.840 --> 0:21:51.359 it or not? But they can't consider cost or cost effectiveness, 0:21:51.400 --> 0:21:55.800 so they couldn't negotiate for prices. Under the Inflation Reduction Act, 0:21:56.280 --> 0:22:00.359 for the first time, Medicare has the ability to start 0:22:00.400 --> 0:22:04.439 negotiating prices on a very limited set of drugs. To 0:22:04.560 --> 0:22:08.640 start off with, do you basically have nine to thirteen 0:22:08.720 --> 0:22:11.320 years as a drug company to profit as much as 0:22:11.359 --> 0:22:14.439 you want before Medicare could negotiate the price. There are 0:22:14.440 --> 0:22:18.200 some other exclusions for drugs, for rare diseases, for example. 0:22:18.960 --> 0:22:22.360 But this is a big development. Medicare will negotiate prices 0:22:22.359 --> 0:22:27.080 on those ten drugs, and then every year thereafter additional 0:22:27.160 --> 0:22:30.119 drugs will kind of get added to the negotiation list. 0:22:30.480 --> 0:22:32.600 And so we hear these stories about people that have 0:22:32.680 --> 0:22:36.359 to fight their insurance companies in the US to get 0:22:36.400 --> 0:22:41.480 expensive treatment covered, and there's some varying outcomes. Is there 0:22:41.520 --> 0:22:45.120 a rhymal reason to this when the decisions are made? 0:22:45.600 --> 0:22:49.960 So, what insurance companies are typically doing is evaluating whether 0:22:50.000 --> 0:22:54.720 a drug is medically necessary, and that might be a 0:22:54.760 --> 0:23:00.119 little bit different than the broad label or indication for 0:23:00.160 --> 0:23:04.040 which FDA approves a drug. So sometimes FDA will approve 0:23:04.040 --> 0:23:07.320 a drug for a very narrow population children up to 0:23:07.359 --> 0:23:11.080 age two, for example. Sometimes though FDA gives a very 0:23:11.080 --> 0:23:15.320 broad indication, you know, people with early stage dementia or 0:23:15.359 --> 0:23:19.159 Alzheimer's disease, for example. And so part of what the 0:23:19.200 --> 0:23:23.080 insurance company has to do is evaluate is there some 0:23:23.320 --> 0:23:27.520 more narrow population for which this FDA approved drug is 0:23:27.520 --> 0:23:32.320 going to truly be medically necessary. Sometimes insurers will say 0:23:32.800 --> 0:23:35.840 you need to have prior authorization, so we want your 0:23:35.960 --> 0:23:39.360 doctor to talk to our insurance company doctors to make 0:23:39.400 --> 0:23:43.200 sure that you can access the drug. Sometimes they will 0:23:43.840 --> 0:23:47.640 make you try other drugs first, but in many cases, 0:23:47.760 --> 0:23:50.680 the drugs that are getting approved are the only thing 0:23:51.119 --> 0:23:56.840 for the disease or condition in question. It's this or nothing. 0:23:57.160 --> 0:24:01.280 And so sometimes we do see insurance company denying access 0:24:01.400 --> 0:24:05.240 to patients because they say it's not medically necessary, and 0:24:05.280 --> 0:24:08.080 then you get into appeals where you know the patient's 0:24:08.080 --> 0:24:10.280 physician will go to the company and say no, it 0:24:10.320 --> 0:24:13.720 really is medically necessary. But of course that takes time 0:24:13.920 --> 0:24:17.520