As medical costs arises, Japan to weigh cost-effectiveness in setting drug prices

As medical costs arises, Japan to weigh cost-effectiveness in setting drug prices

Japanese doctor Yasushi Goto look back prescribing the cancer drug Opdivo to an octogenarian and wondering whether taxpayers might object to helping fund treatment, which at the time cost millions of yen, for patients in their twilight years.

Japanese have easy access to new medicines, whose prices are decided by the government and sponsored by the country’s public health insurance system.

Japanese Drugmakers says that, “there are no plans to deny care for patients of any age. But limiting the prices of innovative but costly treatments might chase new drugs out of the 9 trillion.”

According to Goto, who works at the National Cancer Centre Hospital, “If you ask whether it’s worth prescribing an 85-year-old patient Opdivo, a lot of people will say no. But patients and family members are going to say yes.”

Patients also fear more drastic changes, such as denying access to new medicines; Prime Minister Shinzo Abe’s economic council in December proposed considering cost in determining whether to approve treatments.

“For cancer patients like us, it’s not acceptable if the government applies a cost-effective analysis in determining whether to approve treatments,” said Yoshiyuki Majima, a director of patient advocacy group Rare Cancers Japan.

The Japanese government estimates that public medical spending could surge 75 % to 68.5 trillion yen by 2040.

“It is obvious that Japan will face difficulties in providing social security service,” said a government official, “The cost-effectiveness analysis is a means to secure sustainability.”

ICER, already used in countries such as Britain, considers how much it costs to give a patient one additional year of healthy life compared with existing alternatives. If that exceeds 5 million yen, for example, the government may insist on a lower price, according the policy draft.

“If I have rheumatoid arthritis and I can’t write or type, but then I get a treatment that enables me to go back to work, pay taxes, and take care of my family, that benefit is not going to be captured by the ICER,” said Kevin Haninger, a vice president of Pharmaceutical Research and Manufacturers of America, a lobbying group.

In an interview with Reuters, he insisted Japan should carefully consider an impact on the industry when introducing such analysis to reduce drug prices.

“If Japan is going to cut prices so much, I think Japan will really run a risk of losing its current position,” he said.

Drugmakers have been complaining about price cuts since 2017, when the government decided to review costs more frequently.

Japan has reduced the price of Opdivo, developed by Ono Pharmaceutical Co Ltd and Bristol-Myers Squibb, by more than 75 % in the last two years. It has also lowered Gilead Science’s hepatitis C drug Sovaldi by 32 percent since 2016.

Unlike the United States, where insurers may deny claims, or the UK, where patients can be denied costly drugs, Japan is seen as a relatively predictable market because of its social insurance system.

For example, Novartis’ Kymriah, a type of therapy in which a patient’s T-cells are modified to attack cancer cells, is expected to be approved in Japan this year.

The price for pediatric leukemia patients, to be set by a government panel after approval, is expected to start at about $50 million yen, similar to U.S. prices.

Novartis declined to comment on potential effects of a new pricing policy.

Goto said the government should focus on reducing prescriptions for illnesses that are not serious, rather than costly but possibly life-saving treatments for a small number of patients.

“Flu medicines, for example, can be seen to have very low cost-effectiveness because they don’t save people’s lives, except those of infants or pregnant women, compared with cancer drugs that are critical for some patients,” he said.

Leave a Reply

Your email address will not be published. Required fields are marked *