Rasonque, the new pancreatic cancer treatment from Revolution Medicines, illustrates the huge inflation in cancer drug prices over the past two decades, reports The New York Times.
Revolution Medicines set a sticker price of about $480 000 a year, or $663 a tablet, for its new pancreatic cancer drug – a cost that would have once been unthinkably high. But today, such prices are routine for cancer drugs.
One cutting-edge CAR T therapy now goes for $600 000 for a one-time infusion. A competitor, given the same way, is listed at $550 000. A daily pill for gastrointestinal cancer has a sticker price of $520 000 a year. A twice-daily pill for leukaemia? It’s $430 000 a year.
In 2024 alone, nine cancer drugs were approved and then introduced with sticker prices above $400 000 annually, according to a tally by the Institute for Clinical and Economic Review, which evaluates the value of medicines.
That these prices have become commonplace would have been hard to imagine two decades ago, when even the prospect of a $100 000-a-year cancer drug evoked fierce criticism.
But since then, cancer drug prices have steadily increased, with few constraints beyond what a company thinks the market will bear.
The expense is borne by government programmes like Medicare, employers, patients and Americans who pay taxes and health insurance premiums.
A spokesman for Revolution Medicines, Brian Crawford, said the price of its new drug, Rasonque, “reflects its differentiation and the meaningful benefit it provides for patients”.
As is typical with other cancer drugs, the vast majority of the cost of Rasonque is expected to be covered through insurance, with varying out-of-pocket costs for patients. Crawford said uninsured and underinsured patients who met certain financial and medical criteria would receive the drug free.
The drug, also known as daraxonrasib, is taken as two pills a day.
In the medical world, much of the anger over cancer drug prices has been directed at pricey medicines that either failed or did not undergo clinical trials assessing whether they extend lives. Those drugs won approval because they could shrink tumours or delay their growth.
Revolution Medicines’ drug is not a cure, but it has shown that it can prolong life expectancy. In a key clinical trial, patients with advanced pancreatic cancer who got the pill lived for a median of 13.2 months, compared with 6.7 months for those who got chemotherapy.
Those results have electrified pancreatic cancer specialists and patients because they occurred in people who had no good treatment options and little time left to live.
In that context, it’s hard to say whether Revolution Medicines’ price is fair, said Stacie Dusetzina, a health policy professor at Vanderbilt University who studies drug pricing. “This drug does have substantial clinical benefits over existing treatment, which isn’t always the case for high-priced cancer drugs,” she said.
Cancer patients often stay on a drug for only a matter of months, stopping because it has become too toxic or their cancer has progressed. For example, in the clinical trial that won approval for Rasonque, patients were on the drug for a median of six months.
But even over several months, the costs can pile up, and some patients who respond well can stay on a cancer drug for years.
Over the years, the public and lawmakers have expressed outrage at the high costs of insulin and drugs for HIV, hepatitis C and, most recently, obesity. One-time therapies for rare genetic diseases now routinely carry price tags of a few million dollars.
But cancer holds a unique place in the system, because care and drugs are so expensive and affect so many people.
For the past five years, employers have said cancer is the top disease category driving their medical expenses, according to a survey published in late August by the Business Group on Health, which represents large employers who provide health insurance to their workers.
Compounding the rising costs is that in some cancers, like multiple myeloma, patients are now routinely given three or four therapies at once.
The high prices aren’t limited to drugs that treat small numbers of patients.
Oncology’s biggest blockbuster is Keytruda, priced at $213 000 a year. It is given as an infusion or an injection every few weeks and has been used to treat several million patients.
For many older drugs, generic competition and government negotiations have sharply driven down costs. But there are hardly any limits on manufacturers’ ability to set high prices for newly approved medications.
“We allow pharmaceutical companies to charge whatever they want, and without any clear rationale, other than how much they think they can get,” said Dr Aaron Kesselheim, a professor of medicine at Harvard and Brigham and Women’s Hospital who studies drug pricing.
A drug’s sticker price is not the real price paid by patients or their insurers – it’s just the starting point for negotiations that lower the final price for the employer or the government. But while that dynamic sharply reduces the true prices of diabetes and autoimmune drugs, the final price for cancer drugs is typically only slightly lower than the sticker price.
Cancer drugmakers and their defenders say the prices reflect a boom in innovation that has transformed deadly diseases into chronic ones and even produced cures.
And particularly in the case of smaller companies, they say, there’s a need to recoup considerable investments in clinical trials.
Revolution Medicines, based near San Francisco, has registered $4bn in losses since its founding in 2014. That is largely because of the $3.3bn the company has reported spending on research and development this decade. Buoyed by high investor hopes that Rasonque, the company’s first approved product, will become a blockbuster, Revolution has surged to a market valuation of $45bn.
The company set up an expanded access programme that, over the past few months, granted more than 2 000 patients free, early access to the drug. Now, with its drug approved, the company is shifting participants to getting the drug covered through insurance.
Pharmacy benefit managers play a key role in determining whether new pills, like Rasonque are broadly covered, by recommending to their employer clients whether to pay for them.
Experts said they expected that most insurance plans would cover Rasonque, even at such a high price, because of the strong evidence that it benefits patients and the lack of alternative options.
Still, they added, plans could aggressively seek to limit coverage to people who meet the criteria tested in the clinical trial and approved by regulators: those with advanced pancreatic cancer who have already tried or can’t try chemotherapy. That could shut out many patients seeking it and cause battles over whether a patient is really eligible.
To make sure that ineligible patients aren’t getting the drug, experts predict, plans will use levers like prior authorisation, an often cumbersome review that has been criticised for dangerously delaying care.
Pancreatic cancer disproportionately affects older people, so many of the patients who will take it are covered under Medicare. Federal law should require Medicare drug plans to cover Rasonque because cancer is a protected class.
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