JAMA Analysis Finds No Correlation Between Cancer Drug Prices and Effectiveness

A new study published in the Journal of the American Medical Association (JAMA) Internal Medicine found a lack of correlation between the prices set by Big Pharma on cancer drugs and their effectiveness for patients. “We did not detect a meaningful association between cancer drug prices and the magnitude of benefit for any of the end points,” the researchers wrote. “This suggests that cancer drugs are priced based predominantly on what the market will bear.” In other words, Big Pharma sets prices to maximize profits, not based on clinical value or outcomes for patients.

The study’s authors argue “drugs associated with greater improvements in a specific endpoint such as overall survival… ‘would be expected to cost more… The results of this analysis suggest the opposite: oncology drugs approved based on [overall survival] improvement had the lowest median annual cost.’”

The study also highlighted that among the 119 cancer drugs approved between 2015 and 2020, their median annual cost was a whopping $196,000.

In an accompanying editorial by Isabel R. Ostrer, MD, of the University of California San Francisco, and Cary P. Gross, MD, of the Yale School of Medicine, the authors note that annual spending on cancer drugs in the U.S. tops $200 billion annually, “imposing a substantial burden on the health system, as well as directly on patients and families.”

And “despite spending twice as much on cancer care compared with other high-income countries, the US does not have substantially lower mortality rates,” they continue.

The study comes on the heels of recent reports that manufacturer Areva Pharmaceuticals is bringing an older Leukemia treatment to market at tenfold the price of competitors for an older Leukemia treatment facing shortages.

And a month after a separate analysis in JAMA highlighted the ongoing affordability crisis among cancer patients thanks to Big Pharma’s egregious pricing practices on oncology treatments. Specifically, the analysis found that median annual oncology drug spending for Medicare Part B patients increased from $9,325 to $18,761, while for Part D patients, the number increased from $27,761 to $52,016.

Big Pharma has a long track record of setting sky-high launch prices and consistently hiking prices on oncology treatments:


The root causes of the affordability crisis for cancer drugs are the egregious pricing practices of brand name drug companies, including repeated price hikes on existing treatments and sky-high launch prices on new medications being introduced to the market.

Prices on 54 Cancer Drugs Increased 40 Percent Over Eight Years: “The affordability problem is worsened by soaring list prices for many specialty drugs used to treat cancer and other serious diseases… For instance, prices for 54 orally administered cancer drugs shot up 40 percent from 2010 to 2018, averaging $167,904 for one year of treatment, according to a 2019 JAMA study. Bristol Myers Squibb, the manufacturer of Clark’s drug, Pomalyst, has raised the price 75 percent since it was approved in 2013, to about $237,000 a year.” (“Seniors Face Crushing Drug Costs as Congress Stalls on Capping Medicare Out-Of-Pockets,” Kaiser Health News, January 4, 2021, Harris Meyer)

Cancer Drug Price Hikes Outpace Inflation: “The cost of oral cancer drugs increased by almost six percent over inflation from 2010 to 2018, leading to increases in out-of-pocket costs for Medicare patients despite reductions in the Part D coverage gap, according to an analysis of formulary and pricing data.” (“Costs of Oral Cancer Drugs Rising Faster than Inflation,” MDedge, May 28, 2019, Richard Franki)

List Prices for New Cancer Drugs Rose More Than 50 Percent in Five Years: “It wasn’t all that long ago that a six-figure price on a debut cancer drug was big news. Now, it would be more surprising if an oncology launch didn’t carry a price tag of $100,000 or more—and the high cost of those new rollouts is helping drive cancer treatment costs toward $100 billion annually in the U.S. alone. According to a new IQVIA report, U.S. cancer drug spending climbed to almost $50 billion last year, about twice the $24.8 billion spent in 2012. Along the way, median U.S prices for new therapies climbed above $160,000 last year, more than double the median $79,000 launch price in 2013.” (“Super-Pricey New Cancer Drugs Drive Mega Increases in Treatment Spending,” FiercePharma, May 24, 2018, Eric Sagonowsky)

Every New Cancer Drug Brought To Market In 2017 Cost $100,000 Or More: “Spending on cancer drugs has doubled over the past five years, and little wonder: Every new cancer drug brought to market last year cost $100,000 or more, according to a new report. The average cost of a new drug released in 2017 was $150,000, according to the report from The IQVIA Institute for Human Data Science, formerly IMS Health and Quintiles. Those drug costs are expected to double again by 2022, the report finds. That compares to the average $79,000 cost of new cancer drugs that hit the market in 2013.” (“Cancer Drug Spending Doubled In Last 5 Years, Report Says,” NBC News, May 24, 2018, Maggie Fox)

Drug Companies’ Price Hikes Costing Patients and Taxpayers: “Drugmakers raised prices on more than 400 drugs in the early days of 2020, including two blockbuster cancer treatments that have been top-expenditure drugs in Medicare Part B, according to healthcare analysts and CMS data… Two of the 10 physician-administered drugs that Medicare spent the most money on in 2018 have seen price increases this January, healthcare research firm 3 Axis Advisors found… Merck instituted a price increase of 1.5 percent for Keytruda, the second-highest expenditure Medicare Part B drug in 2018. Bristol-Myers Squibb increased the price for Opdivo, a drug used to treat small cell lung cancer, by 1.5 percent. Opdivo was the third-highest Part B expenditure drug in 2018.” (“Two Blockbuster Cancer Drugs see New Year Price Hikes,” Modern Healthcare, January 3, 2020, Rachel Cohrs)


The out-of-control prices set by Big Pharma on prescription drugs used to treat cancer have created a crisis of affordability — and placed breakthrough treatments out-of-reach for too many American patients.

Nearly Two-Thirds Of Cancer Patients Experience Financial Hardship: “Price tags of life-saving treatments are continuing to increase, with nearly $150 billion being spent nationally per year for cancer care, four times more than treatment for other common health conditions, according to a report from The Mesothelioma Center. Sixty-three percent of cancer patients faced financial struggles following a cancer diagnosis. Cancer treatment costs were reported highest among preventable cancers such as lung cancer, colorectal cancer, breast cancer, and mesothelioma. Specifically, the lifetime cost of lung cancer was an estimated $282,000 while mesothelioma was a reported $150,000.” (“Cost of Cancer Care Reaches Nearly $150B Nationally,” Healthpayer Intelligence, January 15, 2020, Samantha McGrail)

As Many as One in Four Cancer Patients Skip Doses Because of Cost: “One-quarter of all cancer patients chose not to fill a prescription due to cost, according to a 2013 study in The Oncologist. And about 20 percent filled only part of a prescription or took less than the prescribed amount. Given that more than 1.6 million Americans are likely to be diagnosed with cancer this year, that suggests 168,000 to 405,000 ration their own prescription use.” (“As Drug Costs Soar, People Delay Or Skip Cancer Treatments,” NPR, March 15, 2017, Liz Szabo)

Drug Costs as High as $100,000 Per Month Price Patients Out of Care: “According to the findings of the study, ‘The High Cost of Cancer Treatment,’ the latest cancer therapies are extending the lives of cancer patients, but that not all Americans can benefit because some cannot afford the treatments. ‘As cancer survival rates rise, so do the price tags of life-saving treatments,’ the report said. ‘Monthly drugs costs may reach $100,000, causing many Americans to struggle with the physical and emotional effects of high out-of-pocket medical costs. Even worse, others are completely priced out of the hope for a cure.’” (“The Financial Burden of Cancer Treatments Prices Some Out Completely,” BenefitsPro, January 24, 2020, Scott Wooldridge)

The crisis of affordability around cancer drugs is yet another example of why lawmakers must continue to pursue solutions to lower prescription drug prices and hold the pharmaceutical industry accountable.

Read more on the JAMA study HERE.

Read more on Areva Pharmaceuticals egregious price setting on their Leukemia treatment HERE.

Read more on Big Pharma causing a crisis of affordability on cancer treatments HERE.

Read more about how the crisis of affordability on cancer drugs is being driven by Big Pharma’s egregious pricing practices HERE.

Learn more about bipartisan, market-based solutions to hold Big Pharma accountable HERE.

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