This $2,000 drug says everything about our messed up health-care system

December 9, 2013

It seems, on its face, like a pretty simple question, the kind that marketers use in television ads to convince you to switch products.

If you could buy an equally effective medication, would you rather pay $50 or $2,000?

If you're a rational human being, you probably would choose the $50 treatment. But if you're a doctor in our messed up medical system, you regularly pick the $2,000 drug -- and, in the process, help drive up the government's health-care bill by over $1 billion.

This comes from a great new story by Peter Whoriskey and Dan Keating here at The Post, which looked at two drugs that doctors can use to prevent blindness in the elderly. The two drugs, Avastin and Lucentis, are manufactured by the same pharmaceutical company Genentech. "Tested side by side in six major trials, both prevent blindness in a common old-age affliction," Whoriskey and Keating write.

But every incentive in our health-care system preferences Lucentis, the $1,000 drug, over Avastin. Because it's a more expensive drug, doctors get a higher administrative fee when they give it to patients. Avastin is not approved by the Food and Drug Administration to treat blindness -- despite the federal agency urging the manufacturer Genentech -- to submit that type of application.

Avastin is packaged in doses that are too big to treat eye disease, meaning that, as Whoriskey and Keating write, "the drugs must be repackaged by other companies for use in the eye, raising the risk of contamination." Medicare, meanwhile, is not allowed to take cost into consideration when deciding whether to cover a drug. So long as the treatment has been found safe and effective by the FDA, Medicare will pay for the medication.

Those incentives push doctors toward Lucentis, in a big way. This graph shows the amount that Medicare spends on Lucentis annually, compared to what we would spend if doctors treated all patients with Avastin.


A small majority of doctors -- 56 percent, according to Whoriskey and Keating's analysis -- do use Avastin now to treat macular degeneration. But the sizable majority that don't -- the ones who are following the incentives in the health-care system -- mean an extra $1 billion in federal health-care bills.

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Evan Soltas | December 9, 2013