The Value of New Anticancer Drugs

Many costly new anticancer drugs have been introduced in the last two decades. We assess the value of anticancer drugs approved since 1995 for breast, lung, kidney, and chronic myeloid leukemia (CML) based on real-world experience. Using SEER-Medicare data, we identified Medicare beneficiaries diagnosed with metastatic disease between 1995-1999 and 2005-2011. We used modeling approaches to estimate life expectancy and lifetime medical costs. For breast and lung patients we separately analyzed trends among patients who received anticancer drug therapy and patients who went straight to hospice or did not receive any drug therapy. Increases in life expectancy and lifetime medical costs between 1995-1999 and 2005-2011 were as follows. Breast: 9.8 months, $44,000, Lung: 2 months, $9,000, Kidney: 9.5 months, $41,000; CML: 24.3 months, $104,000. Among breast and lung cancer patients, survival gains and cost increases were concentrated in those treated with drugs. There were large increases in costs but also substantial gains in life expectancy. Applying conventional estimates of the wiliness-to-pay for a life year suggests that cancer drugs introduced over the period 1995-2011 are, as a group, cost-effective by conventional standards. We cannot attribute gains to specific drugs, but the fact that increases in life expectancy and costs were concentrated among patients who received drug therapy (versus none) suggests there is a causal relationship between the release of new drug and outcomes.