Erick Bauer is a 28-year-old recently married Toronto resident who works full-time while pursuing an MBA. He also lives with cystic fibrosis, a chronic, progressive and ultimately fatal disease that affects every aspect of his life.
Like many individuals with cystic fibrosis, or CF, Bauer’s daily routine includes 60 to 70 pills, an inhaler that pumps antibiotics and medication into the lungs as well as several hours of physiotherapy. Regular injections and other hospital visits are also required.
Unlike many of their peers, Bauer and his wife, Stefanie Cali, have already prepared wills and thought seriously about her becoming a widow. Vacation plans revolve around Bauer’s health and access to a medical facility. And while they’d like to start a family, Bauer’s condition makes natural conception impossible, which means they face the uncertainty and high cost of fertility treatments.
The development of a new drug is giving fresh hope to Bauer, Cali and thousands of other CF patients and families across Canada and around the world. The problem: It costs $300,000 a year, a price tag that could keep it out of reach.
It’s a situation many health-policy experts say exposes serious problems with Canada’s approach to drug coverage and highlights the need for a better strategy to help patients in need.
Cystic fibrosis is a genetic disease affecting more than 3,000 Canadians. It leads to a buildup of thick mucus in the lungs, resulting in severe respiratory issues. It also affects the digestive system. In Canada, median life expectancy for CF is 48, believed to be the world’s highest.
Kalydeco, developed by Vertex Pharmaceuticals, is the first-ever drug to address the cause of the disease. It targets a faulty protein and enables proper flow of chloride in and out of cells, which helps thin the mucus in the lungs and other organs. In clinical trials, patients on the drug had greater lung function, fewer hospitalizations and increased body weight compared with those taking placebo.
Only about 100 Canadian CF patients with a specific genetic mutation can take the drug, and patients who take it will need it for life. Bauer isn’t a candidate for Kalydeco on its own because he has a different mutation known as delta F508, which is the most common one in CF patients. But there is considerable hope that another compound, known as VX-661, when paired with Kalydeco, can achieve the same results in those with the delta F508 mutation.
Kalydeco was approved in Canada last November, but patients without private insurance will likely need the government to cover the cost. The CF community is anxiously waiting to see if provinces will pay for the drug.
Kalydeco is an orphan drug, a term used for medications that treat rare diseases and are typically very expensive. The rationale for the expense is that because it costs so much to develop orphan drugs and they can only be used by a small number of people, they must be priced higher to help companies get a return on investment.
The continued advancement in molecular therapies and personalized medicine are leading to a growing number of new orphan drugs. The pharmaceutical industry is increasingly looking at orphan drugs as a lucrative new revenue source and a way to boost sales. EvaluatePharma, an industry research firm, published a report in April that predicts by 2018, worldwide orphan drug spending will reach $127 billion, or 16 per cent of total prescription drug sales. As a result, countries like Canada are facing a major dilemma as governments look for ways to provide access to potentially life-altering treatments without bankrupting the health-care system.
When a new drug comes on the market, a federal body called the Common Drug Review will review a number of factors, including overall cost and benefit, and recommend whether provinces should fund it. It’s up to provinces to make their own decisions.
But it’s difficult to evaluate orphan drugs using traditional cost-versus-benefit models because the prices are so high and the patients are often in dire circumstances with few other medical options, said Steve Morgan, associate professor at the Centre for Health Services and Policy Research at the University of British Columbia. Under traditional models, many orphan drugs that could be a lifeline to patients could get rejected.
At the same time, Morgan argues it makes no sense for governments to pay exorbitant prices so that drug companies can recoup their investment or even earn a profit. He argues that drug developers greatly exaggerate their development costs in order to justify orphan drug prices that run into the hundreds of thousands of dollars per patient.
“It’s a total smokescreen,” Morgan said. “It’s unquestionably false numbers.”
Eric Olson, vice-president and program leader for cystic fibrosis at Vertex, said the debate shouldn’t focus on the price tag, but the overall benefit.
“We’re talking about innovative medicines that are breakthrough and are changing the lives of patients,” Olson said.
The EvaluatePharma report does highlight the fact orphan drugs offer a more lucrative return on investment compared to non-orphan drugs, partly because clinical trials are smaller and companies can receive major tax breaks for their investment in rare disease drug development.
Does that mean Canadian governments should push drug companies to lower their prices or refuse drugs that are too expensive? That may happen in the case of Kalydeco. The Common Drug Review recommended provinces cover it, but only if the price is reduced. Provinces are currently negotiating with Vertex.
Larry Lynd, associate director of Collaboration for Outcomes Research and Evaluation group at the University of British Columbia, says Canada’s health-care system can’t afford to continue to pay the current high prices for orphan drugs without making sacrifices elsewhere or finding a way to drive prices down. It’s a complicated ethical question of how far we’re willing to go to help a relatively small number of patients.
And it doesn’t change the frustration felt by Bauer and many others who are caught in the middle of the confused debate.
“At the end of the day, if you’re creating something that works but that nobody can afford or access, then there’s really no point to the whole process in the first place,” Bauer said.