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most expensive drugs Archive

The Most Expensive Medicines are Worth Every Penny

Posted by | 5:03pm on Tuesday, February 23, 2010 | 1 Comment

First, it’s simple economics: fewer patients means higher drug prices. 

A Forbes article came out this week about the most expensive medicines on the market, naming nine drugs that cost more than $200,000 per year.  The author singled out Alexion Pharmaceutical’s Soliris, Shire Pharmaceutical’s Elaprase, and BioMarin Pharmaceutical’s Naglazyme. These are treatments for patients with rare disorders.

Simple Economics
I have several issues with the sensational nature of this piece. First, it’s simple economics: fewer patients means higher drug prices. From the article: “In the inverted world of drug pricing, the fewer patients a drug helps, the more it costs.”  How is this inverted?  Isn’t that how all economics in a capitalist system works?

The bar set by the FDA is not lower, in terms of safety and efficacy, for drugs that address rare diseases. In fact, it’s much harder and sometimes impossible to field a multi-arm clinical trial because there are so few patients and virtually no natural history for many rare disorders.  The Orphan Drug Act offers incentives for companies to have extended monopolies on the orphan drugs they bring to market, and since this act was put in place in 1983 more than 200 orphan drugs have been approved.  Before the Orphan Drug Act there were none.  With our current drug development system, the only chance a patient with a rare disorder has is if a company takes on a risky drug development process through the FDA process designed for bigger market drug trials.
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