Innovative Cancer TherapiesPutting Costs Into Context

David Khayat, MD, PhD

The costs of cancer care are rising, and spending on expensive innovative anticancer agents is likely to come under

scrutiny as health care payers are confronted by the challenge of resource limits in the face of infinite demand. Indi-

rect costs account for the major part of total attributable costs of cancer and are dominated by the cost of mortality

in individuals of working age (who therefore do not contribute to economic productivity). Although cancer is a lead-

ing cause of morbidity and premature mortality, in 2007, it was estimated that cancer accounted for only around 6%

of the total health care costs in Europe. It is estimated that cancer drug costs constitute around 12% of total direct

cancer costs and 5% of the costs of all drugs. Countries vary in their uptake of novel anticancer agents. However,

even in France—a leading nation for the use of these agents—the costs of innovative anticancer drugs accounted for

<0.6% of total health care expenditure in 2006. Population-level data suggest that novel therapies have contributed

(together with advances in screening and other aspects of care) to improvements in survival from cancer. If this is

the case, then the potential reduction in the associated indirect costs could exceed the direct costs associated with

the uptake of innovative drug therapies. Further research is required to establish the costs and benefits of novel

agents in routine practice. Cancer 2012;118:2367-71. VC 2011 American Cancer Society.

KEYWORDS: cancer, new oncology products, costs and cost analysis, budgets.

INTRODUCTIONCancer care spending rose in many European countries during the first half of this decade.1 Health care payers arechallenged by resource limits in the face of infinite demand and the current economic crisis.2 Innovative, molecular-tar-geted anticancer drugs (eg, rituximab, trastuzumab, and bevacizumab) have roles within recommended treatment regi-mens for certain malignancies3-6; however, spending on these agents is likely to be scrutinized, because their relatively highacquisition costs are an identifiable target for reduction, whereas their benefits may appear modest.

Cancer Incidence and Mortality

Cancer incidence is rising, with approximately 2.3 million new cases diagnosed in the 25 European Union countries in2006.7 French data illustrate the rate of increase; the age-standardized incidence of cancer increased by 38% from 1980 to2005.

Although cancer incidence is rising, mortality rates are stable or decreasing, and survival times are increasing. TheEUROCARE-4 study, which included data from 47 cancer registries, demonstrated improved age-adjusted 5-year survivalfor all cancers diagnosed from 2000 to 2002 compared with the previous decade.8 Particular improvements occurred incolorectal, breast, and prostate cancer patients.7,9 Reasons for this falling mortality are not clear and may reflect improve-ments in screening, diagnosis, and treatment.

Despite this favorable trend, cancer caused approximately 1.2 million deaths across European Union countries in2006.7 Cancer is the leading cause of premature death, being responsible for 1 in 4 deaths among women and 1 in 3 deathsamong men.9 Cancers are responsible for 2.3 million years of potential life lost annually in France (Table 1)10,11 and

DOI: 10.1002/cncr.26496, Received: May 25, 2011; Revised: July 13, 2011; Accepted: July 18, 2011, Published online September 14, 2011 in Wiley Online Library

(wileyonlinelibrary.com)

Corresponding author: David Khayat, MD, PhD, Department of Medical Oncology, Salpetriere Hospital, 47 Boulevard de l’Hopital, 75013, Paris, France; Fax: (011)

33-142160499; dk@cancer med.fr

Department of Medical Oncology, Salpetriere Hospital, Paris, France

I acknowledge Julie Adkins and Lee Baker from Prism Ideas Ltd. for medical writing assistance.

David Khayat is Honorary President of the French National Cancer Institute.

Cancer May 1, 2012 2367

Commentary

approximately 10 million disease-adjusted life years lostacross the European Union in 2002. This makes cancerthird only to mental illness and cardiovascular disease interms of disease burden.12

Cancer Cost

As President of the French National Cancer Institute,10 Iasked leading French health economists to determine can-cer costs in France. Their report indicated that these costscan be divided into direct costs (including inpatient/out-patient care, prevention, screening, and research) andindirect costs (including loss of production and produc-tivity). Direct costs evaluate the cost of curative careadministered by health care professionals and institutions,eg, costs associated with inpatient care, prescription medi-cines, and radiotherapy. They do not cover all adminis-tered care, and palliative care in particular may not becovered.10 Indirect cancer costs are evaluated using 2 dif-ferent methods: the human capital method, whichattempts to estimate the loss of individual income causedby premature death (or economic costs of the lost years oflife) and the of the friction costs method, which measuresthe loss of income related to the absence of an individualfrom the workplace.10

Total cancer costs in France were approximately €29billion in 2004 (Table 2)10; direct costs represented <9%of the total health budget (€140 billion)—a relatively lowfigure given the burden of cancer. Across Europe, it is esti-mated that cancer accounted for only 6.3% of health carecosts,13 varying from 3% to 5% in Eastern Europeancountries and up to 7.2% in Germany and Sweden.

Indirect cancer costs in France in 2004 amounted to€17.5 billion (approximately 45% higher than the directcost).10 Indirect cost is dominated by the loss of economicproduction caused by premature death; at €16.9 billion,the cost of lost production attributable to cancer mortalityin France in 2004 represents 97% of indirect costs (Table

Table 1. Cancer Mortality and Potential Years of Life Lost in France in 2002a

No. of Deaths No. of PotentialYears of Life Lost

DiseaseSite

Males Females Total Males Females Total Average PotentialNo. of Yearsof Life Lostper Patient

Lung 22,326 5051 27,377 361,750 98,490 460,240 17

Colorectal 8563 7570 16,133 106,473 96,863 203,336 13

Lymphatic 6592 5945 12,537 94,477 88,494 182,971 15

Breast 185 11,172 11,357 2552 209,980 212,532 19

Prostate 9271 0 9271 81,195 0 81,195 9

Pancreas 3812 3614 7426 54,932 49,585 104,517 14

Liver 5182 1760 6942 73,532 24,746 98,278 14

Stomach 3140 1978 5118 42,085 25,402 67,487 13

Oral 3759 785 4544 73,687 16,218 89,905 20

Bladder 3278 1002 4280 38,561 10,745 49,306 12

All cancers 90,989 61,749 152,738 1,316,986 980,986 2,297,972 15

aData are presented for the top 10 malignancies in terms of mortality rate (see French National Cancer Institute, 200710).

Table 2. Direct and Indirect Costs of Cancer in France in2004a

Cost Euros(Million)

Total social security fund budget 140,000

Direct costs 11,923

Cost of care 10,886

Inpatient 7185

Outpatient 3701

Prevention (public health policy against cancer) 120

Tobacco 46

Nutrition 63

Alcohol 11

Screening 247

Breast 194

Colorectal 53

Public funded cancer research 670

State budget 324

Social security 302

NCI 44

Indirect costs 17,449

Loss of production

Loss of productivity caused by lost work days 528

Loss of productivity attributable to cancer mortality 16,921

Total cost (direct plus indirect costs) 29,373

Abbreviations: NCI, French National Cancer Institute.a See French National Cancer Institute, 2007.10

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2368 Cancer May 1, 2012

2). This figure far exceeds the direct costs of cancer care(€11.9 billion). Similarly, in Sweden, indirect costsaccounted for 70% of total breast cancer costs in 2002.Lost production caused by premature death accounted for52% of the indirect costs.14 Therefore, dying from cancercosts significantly more than treating this disease.

Across Europe, cancer drugs account for 5% of alldrug costs.13 Drug costs averaged 12% of total direct can-cer costs, although this varied between 5% and 9% inNorway, the United Kingdom, Switzerland, and Den-mark and >20% in the Czech Republic, Hungary, andPoland. Although cancer care often is viewed as costly, thedirect per-patient costs (Fig. 1), and the proportion ofcosts attributed to drug therapy (Fig. 2) are lower thanthose for other chronic diseases.15

Do Innovative Cancer Therapies Offer Valuefor Money?

It is estimated that the total sales of oncology drugs in 25countries (including 19 European countries) haveincreased 5-fold from 1995 to 2005.13 In France, the costof innovative cancer therapies rose from €335 million in2003 to €714 million in 2006. According to the FrenchPharmaceutical Companies Association, in 2006, drugcosts in France accounted for approximately 20% of thesocial security health budget (approximately €28 billion).However, innovative anticancer drugs were responsiblefor just €0.75 billion, or<0.6%, of this total.

Spending on cancer drugs is expected to continueincreasing, although the rate of increase may fall as genericversions of newer therapies are introduced and competitionincreases.1 The use of more expensive technologies does notnecessarily translate into an increase in the total cost associ-ated with an illness. Newer drugs may lower the demandfor other medical services (eg, hospitalization),16 whereasincreased survival could lower societal costs1—an aspectthat remains under researched.17 Moreover, cost-effective-ness of an anticancer agent may improve as it is used earlierin therapy wherein it prevents disease recurrence.18

Do innovative cancer treatments improve survival?Randomized clinical trials have demonstrated statisticallysignificant, incremental improvements in survival withsome molecular-targeted agents in certain indications,including lung,19,20 breast,21,22 and colon cancers23 andhematologic malignancies.24-27 Epidemiological data alsosupport a survival benefit of newer therapies in somemalignancies; data from the Cancer Registry of Norwayindicate that the per-inhabitant use of vinorelbine from1999 to 2005 was correlated inversely with the risk ofdeath in patients with nonsmall cell lung cancer.28 Datafrom the Surveillance, Epidemiology, and End ResultsProgram in the United States also reveal improvements inthe survival of patients with hematologic malignancies.29-37 In some cases, these changes have been attributed tonew technologies. However, these data do not allow thedirect quantification of the impact of specific treatments.Furthermore, current data analyses to the middle of thecurrent decade do not yet reflect the impact of recentlyintroduced therapies.

Figure 1. The mean annual expenditures for each patienttreated for cancer are compared with the mean annualexpenditures associated with other chronic diseases (basedon data from Vallier N, Weill A, Salanave B, et al. Cost ofthirty long-term diseases for beneficiaries of the French gen-eral health insurance scheme in 2004 [article in French]. PratOrgan Soins. 2006;37:257-28315). HIV indicates human immu-nodeficiency virus.

Figure 2. Contribution of drug therapy to total disease costsfor cancer and other chronic diseases (based on data fromVallier N, Weill A, Salanave B, et al. Cost of thirty long-termdiseases for beneficiaries of the French general health insur-ance scheme in 2004 [article in French]. Prat Organ Soins.2006;37:257-28315). HIV indicates human immunodeficiencyvirus.

Innovative Therapies: Costs and Context/Khayat

Cancer May 1, 2012 2369

Researchers at Sweden’s Karolinska Institute ana-lyzed the relation between the availability of new anti-cancer drugs and the associated effect on survival in 3different ways.13 First, according to 1 analysis, 44% of theimprovement in cancer survival rates from 1992 to 2000at 50 US cancer centers could be attributed to newer anti-cancer drugs. Second, 14% to 19% of the intercountrydifferences in 5-year cancer survival rates across 5 majorEuropean Union countries were because of the uptake ofnewer drugs (after 1985). Finally, these researchers mod-eled the effect of newer drug ‘‘vintages’’ on cancer mortal-ity (adjusted for age and gross domestic product) in 20countries from 1995 to 2003; adjusted mortalitydecreased by approximately 16% during this period, andthe use of newer drugs accounted for 30% of this trend(ie, an absolute reduction of approximately 5%).13

The Karolinska study was criticized for flawed dataand methodology,38,39 with more rapid access to innova-tive drug therapy suggested as a surrogate marker of otherfactors that prolong survival, including improved diagno-sis.38,39 However, although the Karolinska data have limi-tations, they are worth considering.

Access

Substantial disparities exist between European countries inper capita spending on novel anticancer agents. Accordingto 2005 data, France, Switzerland, and Austria were theleading European nations.13 By 2005, the use of trastuzu-mab in France was approximately 50% higher than theEuropean average. Data from 2007 to 2008 suggest thatuptake of new agents remains high in France, moderate inGermany and Italy, and low in the United Kingdom.1

Access to new anticancer drugs in France has beenimproved by several measures. More than 75% of healthcare funding in France is provided by the National SocialSecurity system.40 Cancer care is covered under the Affec-tions de Longue Duree and French patients receive fullreimbursement of their health care costs. In 2004, I per-suaded the French government to set up a new locus bywhich hospitals receive full, unrestricted state reimburse-ment for costly innovative anticancer drugs. This freedclinicians to prescribe novel agents according to clinicalneed, although it was contingent on meeting specific crite-ria with full reimbursement only realized when drugs areprescribed according to the ‘‘good use’’ contract. Duringthe 5 years after the introduction of this legislation, ex-penditure on cancer drugs increased from €230 million to€1 billion, suggesting substantial under use of innovativetherapies before 2004.

Access to an effective drug can be delayed by regula-tory approval even when data support its use. In 2005, Ilobbied the French government to establish the Tempo-rary Treatment Protocol (PTT) to help prevent delays.The PTT convenes a panel of experts to assess data con-cerning new indications for drugs that are alreadyapproved (eg, in 2005, it was demonstrated that trastuzu-mab provides significant benefits as adjuvant treatmentfor breast cancer,41,42 but it approved only for metastaticdisease; therefore, patients could not benefit from thesefindings pending regulatory review). The PTT panelreviews new data, and, if it expects that a drug will begranted a new indication by the European MedicinesAgency, patients are given immediate access in that indi-cation. If the drug gains this indication, then patients con-tinue to be treated. If not, then access is stopped.

In conclusion, the adoption of novel anticancertherapies into clinical practice is vital to reduce cancermortality rates. The potential reduction in indirect cancercosts could exceed the direct costs of therapy as well asproviding patient benefits. In France, where innovativedrugs are fully reimbursed subject to a ‘‘good use’’ con-tract, such benefits were achieved in 2006 using a rela-tively small proportion of the health care budget. TheFrench health care system differs from that of many othercountries, but the key issue is the cost in proportion to thetotal health care budget, rather than who pays. Crucially,well designed, noninterventional, postapproval studies arerequired to properly assess the costs and benefits of inno-vative anticancer drugs.

FUNDING SOURCESMedical writing assistance from Prism Ideas Ltd. wasfunded by Association pour la Vie, Espoir Contre leCancer.

CONFLICT OF INTEREST DISCLOSURESDavid Khayat has received consultancy fees from Roche, AstraZenecaand Sanofi-Aventis.

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