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ERROR: type should be string, got "https://blogs.wsj.com/pharmalot/2014/10/07/financial-toxicity-whos-really-to-blame-for-high-cancer-drug-prices/\n‘Financial Toxicity:’ Who’s Really to Blame for High Cancer Drug Prices?\nEd Silverman\nOct 7, 2014 9:02 am ET\nCorbis\nFile this under ‘the blame game.’\nThe issue of expensive cancer drugs is hardly new, of course, but 60 Minutes aired a segment that the other night that likely helped highlight the controversy for the mass audience that watches the popular news program. The episode, however, is unlikely to have helped the pharmaceutical industry.\nWhy? A central theme was that drug makers are overcharging and one explanation offered – none of which came directly from any of the companies that make and sell these medicines – was familiar. An industry trade group says developments costs are high, but also blamed insurers for forcing patients to share too much of the cost and tried to downplay the notion that insurers do not set drug prices.\nA key focus of the segment was the ruckus raised two years ago when physicians at Memorial Sloan Kettering in New York rejected use of the Zaltrap medicine sold by Sanofi, because the price tag exceeded $100,000, or about $11,000 a month. This was about twice the cost of Avastin, a comparable treatment.\nTheir move accelerated the debate over rising drug prices and forced Sanofi to respond. How so? To placate physicians, the drug maker offered a deal – doctors could buy Zaltrap for $11,000, which would allow them to be reimbursed by insurance at the usual rates, and also receive a check for $6,000.\n“They lowered [the price] in a way that doctors could get the drug for less,” Peter Bach, who directs the Center for Health Policy and Outcomes at Sloan Kettering, told 60 Minutes. “They could basically double their money if they use Zaltrap.”\nPatients, meanwhile, would continue to pay the full price tag. Leonard Satlz, another Sloan Kettering physician who led the effort to eschew Zaltrap was rather blunt in assessing the situation: “We’re starting to see the term ‘financial toxicity’ being used in the literature,” he told 60 Minutes.\nNo one from Sanofi was on camera to discuss any of this. We asked the drug maker for comment and will let you know what they say.\nWho did appear to speak for drug makers? John Castellani, who heads the Pharmaceutical Research and Manufacturers of America, the industry trade group, declined to discuss the Zaltrap affair, but he did attempt to discuss the pricing rationale. Here is the exchange in which he offered a defense…\n60 Minutes: If you are taking a drug that’s not better than another drug already on the market and charging twice as much, and everybody thought the original was drug was too much…\nCastellani:We don’t set the prices on what the patient pays. What a patient pays is determined by his or her insurance.\n60 Minutes: Are you saying that the pharmaceutical company’s not to blame for how much the patient is paying? You’re saying it’s the insurance company?\nCastellani: I’m saying the insurance model makes the medicine seem artificially expensive for the patient, [a reference to the co-pay charge for cancer drugs, which is 20% for Medicare patients].\n60 Minutes: Twenty percent of $11,000 a month is a heck of a lot more than 20% of $5,000 a month.\nCastellani: But why should it be 20% instead of 5%?\n60 Minutes: Why should [the price of the drug] be $11,000 a month?\nCastellani: Because the cost of developing these therapies is so expensive.\n60 Minutes: Then why did Sanofi cut it in half when they some bad publicity?\nCastellani: I can’t respond to a specific company [EDITOR'S NOTE: The complete segment can be seen below].\nYesterday, the BIO trade group released a statement also blaming insurers. “If CBS is truly concerned about the problems faced by cancer patients,” the trade group, “… it would do well to explore the insurance industry’s recent expansion of the use of specialty tier cost sharing.”\nThis involves paying a tiered percentage of drug costs instead of a flat co-payment. “This approach can cost patients thousands of dollars out of pocket,” limit access to medicines and “injects” a third party into the relationship between physicians and patients.\nIn turn, a spokesman for America’s Health Insurance Plans wrote us that “Blaming anyone else for the prices that they alone are choosing is just disingenuous distortion.”\nOf course, it’s true that drug development is costly and a great deal of money is spent toward successfully developing and testing the few medicines that make it out of the lab into pharmacies and hospitals, although there is also considerable debate about how development costs are apportioned.\nNonetheless, drug makers are more attuned to developing medicines that yield high returns and that is most easily achieved by pricing high. Blaming insurance may resonate with some people, but it is also true that pharmaceutical pricing sets a floor from which insurers and other payers must operate.\nThe key question now is whether drug makers will refashion their business model before they hit a wall and encounter push back. Given the growing financial burden some patients are experiencing, one ethicist says that time has come.\n“There is no logic to the prices being charged nor is there even a hint of a sound explanation of why prices are high or why there is any justification for raising them year after year,” says Art Caplan, who heads bioethics in the Division of Medical Ethics at the NYU Langone Medical Center and appeared on a panel about cancer drug prices last week with Sloan Kettering’s Saltz.\n“This means that access is limited by price, that co-pays quickly become burdensome, people go into debt to finance care and the nation is burdened with huge costs, which means less money to cover other useful tests and remedies.”\nMemorial Sloan Kettering\nPhRMA\nZaltrap\nPrevious Pharmalot, Pharmalittle: We're Reading About Pfizer, Teva and Lots More!! Next Sanofi is the Latest Drug Maker to Probe Bribery Allegations\nSHOW CONVERSATION HIDE CONVERSATION\n'Financial Toxicity:' Who's Really to Blame for High Cancer Drug Prices?"