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Cost of one cancer drug for one year: $100,000

Published Feb. 15, 2006

Doctors say they are excited about the prospect of Avastin, a drug already widely used for colon cancer, as a crucial new treatment for breast and lung cancer, too.

But doctors are also cringing at the price the maker, Genentech, plans to charge for it: about $100,000 a year.

That price, about double the current level as a colon cancer treatment, would raise Avastin to an annual cost typically found only for medicines used to treat rare diseases that affect small numbers of patients.

But Avastin, already a billion-dollar drug, has a potential patient pool of hundreds of thousands of people - which is why analysts predict its U.S. sales could grow nearly sevenfold to $7-billion by 2009.

Doctors, though, say some cancer patients are already being priced out of the Avastin market. Even some patients with insurance are thinking hard before agreeing to treatment, doctors say, because out-of-pocket co-payments for the drug could easily run $10,000 to $20,000 a year.

Until now, drugmakers have typically defended high prices by noting the cost of developing new medicines. But executives at Genentech and its majority owner, Roche, are now using a separate argument - citing the inherent value of life-sustaining therapies. If society wants the benefits, they say, it must be ready to spend more for treatments like Avastin and another of the company's cancer drugs, Herceptin, which sells for $40,000 a year.

"As we look at Avastin and Herceptin pricing, right now the health economics hold up, and therefore I don't see any reason to be touching them," said William M. Burns, chief executive of Roche's pharmaceutical division and a member of Genentech's board. "The pressure on society to use strong and good products is there."

Studies indicate Avastin can prolong the lives of patients with late-stage breast and lung cancer by several months when the drug is combined with existing therapies. Genentech expects to seek federal approval later this year to sell it specifically for those diseases. But even now, doctors are using Avastin for some breast and lung cancer cases - and finding its cost beyond the means of some patients.

"Avastin is a superb drug, but its cost is already discouraging patients and doctors from using it," said Dr. David Johnson, who heads the cancer unit at Vanderbilt University and is a former president of the American Society of Clinical Oncology. "I wish it were one-tenth the cost, and if it were I would be giving it to almost everybody."

With colon cancer, a year of Avastin treatment costs about $50,000. But the drug will be used at higher doses for lung and breast cancer, and Genentech does not plan to reduce the unit price, even though the additional cost of producing a higher dose is minimal. Roche executives described the pricing plans in a recent interview.

Because Genentech is a leading developer of cancer therapies, some doctors also say they fear the company's pricing plans for Avastin - about $8,800 a month - could encourage other companies to charge more for their own oncology drugs. That could potentially drive up the overall cost of cancer treatment to unsustainable levels, they say.

Dr. Susan Desmond-Hellmann, president of product development of Genentech, which is based in South San Francisco, Calif., said Genentech had set Avastin's price based on "the value of innovation, and the value of new therapies."

Genentech, which had more than $6-billion in sales last year, has programs to help patients afford its medicines, and last year contributed $21-million to charities that help patients with their insurance co-payments, she said.

Genentech intends to file an application this year with the Food and Drug Administration to expand the drug's label to include treatment for breast and lung cancer. While nothing stops doctors now from prescribing Avastin for those diseases, FDA approval would let the company promote and advertise it for such treatments and make insurers more likely to pay for the treatments.