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Medicare to pay for $93,000 prostate cancer drug Provenge

A Dendreon employee in New Jersey works on Provenge, a drug that analysts say could rack up $1 billion in sales next year.

Dendreon Corp.

A Dendreon employee in New Jersey works on Provenge, a drug that analysts say could rack up $1 billion in sales next year.

WASHINGTON — Medicare officials said Wednesday that the program will pay for an expensive vaccine recently approved to treat men with advanced prostate cancer.

The price for each patient: $93,000. The benefit: The vaccine, known as Provenge, appears able to extend patients' lives by about four months.

"The evidence is adequate to conclude that" Provenge "improves health outcomes for Medicare beneficiaries" with metastatic prostate cancer, "and thus is reasonable and necessary for that indication," the Centers for Medicare and Medicaid Services said in announcing its decision, which will be finalized by June 30 after a period for public comment.

Provenge is the latest in a series of new, high-priced cancer treatments that appear to eke out only a few more months of life, prompting alarm about their costs.

Although Medicare is not supposed to take cost into consideration when making such rulings, the decision by CMS to launch a formal examination raised concerns among cancer experts, drug companies, lawmakers, prostate cancer patients and advocacy groups.

The decision ensures that millions of men would be able to afford the drug through the government-backed health care coverage. With government reimbursement, analysts estimate the biotech drug made by Dendreon Corp. could rack up $1 billion in sales next year. The decision is important for Dendreon because most prostate cancer patients are 65 or older.

Medicare usually covers new cancer drugs once they have been approved by the FDA. The decision in June to scrutinize Provenge prompted several members of Congress to question the action. Supporters of the drug's approval inundated the agency with hundreds of thousands of comments.

Provenge has long been controversial. The FDA delayed its approval in 2007. The rejection triggered outrage among patients, advocates and investors in Dendreon. The campaign to win Provenge's approval included anonymous death threats, accusations of conflicts of interest, protests, congressional lobbying and vitriolic Internet postings.

Prostate cancer strikes 192,000 men in the United States each year and kills about 27,000. The only therapies are surgery, radiation, hormones and the chemotherapy drug Taxotere.

Unlike standard vaccines, which are given before someone gets sick to stimulate their immune system to fight off infections, Provenge is a "therapeutic vaccine," designed to spur the immune system to attack cancer cells in the body.

Each dose is customized to work with a patient's immune system. The treatment is intended for men whose prostate cancer has spread elsewhere in the body and is not responding to hormone therapy or radiation.

Seattle-based Dendreon says Provenge's price reflects the more than $1 billion spent researching and developing the drug. And prostate cancer patients point out that the median survival time with Provenge is double that of chemotherapy, which is about two months and is marked by significant side effects.

"It's impossible to put a dollar figure on a human life, especially when you're talking about a drug that has such mild side effects," said Jim Kiefert, a prostate cancer patient and advocate who was part of the Provenge study. "Of all the treatments I've had — with surgery, radiation and hormone treatment — Provenge had fewer side effects than any of them."

But bioethicists who study health care decisions say Medicare's ruling on Provenge mirrors the bias of the overall U.S. health system, which emphasizes expensive treatments over basic medical care. Health care costs account for nearly one fifth of the U.S. economy, more than any other country.

"We tend to put our health care dollars into very high-tech interventions that produce very marginal improvements," said Dr. Steven Miles, a professor at the University of Minnesota's Center for Bioethics. "The problem is that we have created a health care system that is uniquely inadequate in terms of access to primary health care, which is where you get the most bang for your buck."

A growing number of biologically engineered cancer drugs are being priced in the $100,000 range, including therapies from Roche and Eli Lilly & Co. Last week, Bristol-Myers Squibb Co. received approval for a new melanoma drug that will be priced at roughly $120,000 per patient.

Medicare officials have said the agency's review of Provenge was aimed at clearing up bureaucratic confusion among Medicare carriers across the country, some of whom already pay for Provenge. Medicare on Wednesday called its online memo a "proposed decision," but it essentially amounts to agreeing to cover the drug for millions of seniors enrolled in its program.

The news sent Dendreon shares up 66 cents to $36.20 in after-hours trading. The stock closed the regular session down 34 cents at $35.54 before the announcement.

Information from the Washington Post and Associated Press was used in this report.

Medicare to pay for $93,000 prostate cancer drug Provenge 03/30/11 [Last modified: Wednesday, March 30, 2011 10:53pm]
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