Impact Story

Adding Cost to the Equation: The Case of Zaltrap

When the Food and Drug Administration (FDA) evaluates a new drug, the panel reviews its safety and efficacy profiles. Their approval paves the way for a patent for the drug which allows the pharmaceutical company complete discretion to set the price which Medicare is then required to pay.

Concerned about the rising cost of cancer drugs, Memorial Sloan Kettering Cancer Center’s Pharmacy and Therapeutics Committee decided that price could be one of the considerations in evaluating a new drug. Their review of Sanofi’s FDA approved colon cancer drug, Zaltrap®, determined that it lacked any additional benefit compared to a drug they already used and that its price was more than double. They agreed to not add Zaltrap to their formulary.

Key Takeaways

In an unprecedented move, Dr. Bach and colleagues refused to add Zaltrap (aflibercept) to MSKCC's formulary due to its high cost and limited added benefits compared to a comparator, Avastin (bevacizumab).

Sanofi lowered the price by nearly 50% in response to the widespread attention of their decision.

Dr. Bach and Colleagues use NY Times Op Ed to Discuss the Issue

The physicians explained their decision in-house and gained support. Then, they brought the issue to the public in a New York Times op ed, “In Cancer Care, Cost Matters”, published October 14, 2012.

Drs. Peter B. Bach, Leonard B. Saltz, and Robert E. Wittes wrote, “At Memorial Sloan Kettering Cancer Center, we recently made a decision that should have been a no-brainer: we are not going to give a phenomenally expensive new cancer drug to our patients”.

“The reasons are simple: The drug, Zaltrap®, has proved to be no better than a similar medicine (Avastin) we already have for advanced colorectal cancer, while its price — at $11,063 on average for a month of treatment — is more than twice as high.”

“When choosing treatments for a patient, we have to consider the financial strains they may cause alongside the benefits they might deliver.”  The “burden of this cost is borne, increasingly, by patients themselves — and the effects can be devastating. In 2006, one-quarter of cancer patients reported that they had used up all or most of their savings paying for care. A study in 2011 reported 2 percent of cancer patients were driven into bankruptcy by their illness and its treatment.”

The doctors’ op ed reverberated from pharmaceutical companies to cancer centers to policy makers and patients. Sloan-Kettering’s refusal to use an FDA approved cancer drug because of its high cost was unprecedented. Nevertheless, Sanofi said it would not reduce the price. But less than a month later, they did just that.

Sanofi Pharmaceutical Changes Course

In a story covered in the New York Times on November 8, 2012, business reporter Andrew Pollack’s headline, “Sanofi Halves Price of Cancer Drug Zaltrap® After Sloan-Kettering Rejection”, told the story.

“In an unusual move, a big drug company said on Thursday that it would effectively cut in half the price of a new cancer drug after a leading cancer center said it would not use the drug because it was too expensive,” wrote Pollack.

“The move — announced by Sanofi for the colon cancer drug Zaltrap® — could be a sign of resistance to the unfettered increase in the prices of cancer drugs, some of which cost more than $100,000 a year and increase survival by a few months at best.”

Sanofi said it would offer discounts of about 50 percent although it would not change the official price of Zaltrap®. The final cost to the patient would vary depending on their insurance coverage and any co-pay.

Dr. Peter B. Bach, director of the Center for Health Policy and Outcomes at Sloan-Kettering and a co-author of the Op-Ed piece, told Pollack, “the price of Zaltrap® reflected a bigger problem — that over all there was little relation between drug prices and the value they provided”.

“Normal markets wouldn’t behave like this,” said Bach. “You couldn’t introduce something twice as expensive and no better and still sell it.” Sloan-Kettering never offered the drug.

The price of Zaltrap reflected a bigger problem — that over all there was little relation between drug prices and the value they provided.

Challenge to Cancer Drug Prices Continues to Resonate

The coverage of Sloan Kettering’s decision to not use Zaltrap® followed by Sanofi’s announced price reduction was widespread, appearing in Forbes, The Cancer Letter, the Washington Post, Reuters, Newsweek, the Wall Street Journal, NPR, the New York Times, FiercePharma, Fierce Biotech, Health Affairs, and New York Magazine.

In an interview on CBS 60 Minutes that aired October 5, 2014, Dr. Bach discussed “the extremely high cost of cancer drugs” with correspondent, Leslie Stahl. “We have a pricing system for drugs that is completely dictated by the people who are making the drugs,” explained Bach. “Many drugs used to treat cancers cost more than $100,000 a year, a large portion of which is often absorbed by insurers.”

During the 2012 Zaltrap discussions, Bach said that “Sanofi told doctors to buy Zaltrap for the regular $11,000 price. It would pay back $6,000 to the doctors who could then prescribe Zaltrap to their patients while” continuing to bill insurers for the full $11,000 cost.

Eight years after Dr. Bach and Sloan-Kettering colleagues New York Times Zaltrap op ed, the dialogue is ongoing but the issue of pricing remains unresolved.

More recently, the Zaltrap story was featured in a book, “The Price of Global Health: Drug Pricing Strategies to Balance Patient Access and the Funding of Innovation” by Ed Schoonveld published May 17, 2020.

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