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Never-ending Gleevec Drug Price Increases Are Prime Example of Market Failure and Greed

Gleevec 400 mg tablets

Gleevec 400 mg tablets.  photo adapted from [CC BY-SA 3.0], Patrick Pelletier via Wikimedia Commons

An article in the Washington Post yesterday covered the steep rise in the cost of a cancer medication called Gleevec, drug company Novartis’ brand name for imatinib, which is incredibly successful in treating people with chronic myeloid leukemia (CML). Despite its concern with public perception over price at the time, Novartis charged $26,400/year when the drug hit the market in 2001. With today’s price for Gleevec now $126,000/year it seems any concerns by Novartis have gone by the wayside (or did they really exist at all?). One would think and hope that new, similar products would bring down – or at least slow increases of – the price of Gleevec. After all, competition is supposed to drive down prices.

Not in the pharmaceutical industry, at least not until a drug goes off patent. The launch of therapeutically equivalent brand medications to treat CML actually coincided with Gleevec’s steepest price increases. Bristol-Myers Squibb launched Sprycel (dasatinib) in 2006 and Novartis launched a second generation drug called Tasinga (nilotinib) in 2007, both at much higher prices than Gleevec. In 2007, the monthly prices for Gleevec, Sprycel and Tasinga were $3,757, $5,477 and $6,929, respectively. The details can be found in the Post’s article but essentially Gleevec started to play “catch up” to its competitors.

In 2007, the price of Gleevec was 46% less than Tasinga. By 2014, the discount had shrunk to 12% with Gleevec’s price at $8,156/month compared to Tasinga’s price of $9,300/month. Let’s keep in mind that the newer drugs were shown to treat people that Gleevec could not treat, which would soften the argument that these are truly competing products. But soon after their introduction, Sprycel and Tasinga were found to successfully treat people with newly diagnosed cases of CML, to more directly compete with Gleevec, yet the latter’s price soared!

Source: Graph below from the Washington Post.

Graph - increase in Gleevec Rising drug prices New drugs treating chronic myeloid leukemia were introduced at prices higher than Gleevec's. their prices have gradually risen since, and Gleevec's price has increased at a greater clip.

One source cited in the post’s article summed it up perfectly. A hematologist from the University of Chicago, Richard Larson, stated: “Ordinarily, you might think with three equally effective drugs on the market, the price should go down through competition, but it’s been a failure of the competitive pricing process.”

While the Washington Post’s article delved into the problem of out of pocket costs for Gleevec, it didn’t hammer home that the suffering in America is extreme when it comes to Gleevec’s drug price (and other medication prices as well). Gleevec is not a new topic on these blog pages, which has solicited comments from people and families crushed by drug costs. Yes, the irony is glaring: cancer medications that alleviate suffering also create suffering, too, in the form of cancer patients facing bankruptcy, feeling guilt, and causing anxiety.

It’s not just market failure – it is greed, too. I’ll let one American, Penny Kincaid, a commenter on this blog, bring it home:

“I guess I am luckier than many on Gleevec. I am paying 5% of the cost each month but the cost keeps going up. Our lives depend on this drug but still the cost is obscene. They praise themselves for creating [these] drugs for patients with [CML] but still we are forced to pay and many go broke. It is the cancer patient who has to pay up or die and they keep raising the cost. This is just wrong in so many ways and here we have the creators wanting to deny us the generic because they want that big money to keep rolling in. They should be ashamed of themselves.”

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Cancer Drug Prices Can Kill

Americans with cancer are two times as likely to go bankrupt than other Americans due to the expense of treatment, including astronomical prices for prescription drugs. As reported by ABC News the alternative to bankruptcy is sometimes death.

This blog’s focus is often on international online pharmacies as a lifeline for high drug prices in the U.S. When it comes to cancer medications, online pharmacies are not always a solution since many can only be administered in a clinical setting are not suitable for mail-order pharmacy. However, some cancer meds are suitable for mail order pharmacy, and can be found for much cheaper prices from an international online pharmacy as opposed to a U.S. pharmacy.

Bristol Myers Squibb’s product Sprycel, which treats leukemia, costs $11,000 (60 pills, 50 mg) at a CVS in New York City pharmacy. The same quantity is available from a PharmacyChecker.com approved pharmacy for $5,509, or 50% cheaper. That’s $60,000 savings a year, a discount higher than the median household income in the U.S., and for some the difference between life and death.

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