Here's a thought-provoking post by Douglas Krohn in Seeking Alpha. In it he asks, What would be the prospects of Provenge being accepted by the UK's National Health Service (NHS) based on its perceived cost-efficacy?
Good question to ponder. Provenge, as reminder, is a newly approved innovative approach to treat late stage metastatic prostate cancer. In clinical trials, it was able to extend life by an average of 4 months as compared to a placebo. It is expected to cost an average of $93,000 per treatment course. Medicare last week indicated that it would initiate a coverage determination on the new drug - a process expected to last a year. Dendreon's stock dropped rather precipitously last week on the initial news.
Applying the NHS' National Institute for Health and Clinical Excellence (NICE) criteria for quality-adjusted life year (QALY) to Provenge results in an estimated cost lying between $282 K and $547 K per year. That is to say the NHS and NICE formula would estimate Provenge costs that much to buy those 4 extra months. As a practical matter, the NHS rarely if ever funds a treatment with a QALY greater than $60 K. So Provenge would never be covered there. And likely, not in most other Western European countries.
If the US ever goes to a UK type system, what does that say about new Provenge-type therapies? What do you think about Provenges chances now in its Medicare review under a new healthcare doctrine?
Posted by Bruce Lehr July 7th 2010.