In praise of "death panels"
By Scott Sumner
As far as I know, neither political party has ever advocated “death panels”, that is, panels of experts that would deny Medicare coverage to FDA-approved treatments that don’t pass a cost/benefit test. But maybe they should.
Biogen’s new drug to treat Alzheimer’s was recently evaluated by the FDA. Here is Rachel Sachs in Health Affairs:
In March 2019, both trials were stopped halfway through, when “a planned interim analysis met prespecified futility criteria.” But Biogen went further into the data, analyzing the results and arguing that the high-dose patient population in the second trial had in fact experienced a statistically significant clinical benefit when measured against the placebo (a 22 percent reduction of clinical decline as measured on a chosen clinical scale), albeit a benefit absent from the high-dose population in the other trial or the low-dose population in either trial. On this basis, Biogen submitted an application to the agency for approval in July 2020.
In November 2020, the FDA convened a meeting of the pertinent advisory committee to review the evidence surrounding aducanumab. The advisory committee was highly skeptical of the post-hoc rationale used to provide evidence of the drug’s effectiveness, particularly when viewed against the backdrop of decades of failures of drugs which similarly targeted amyloid plaques.
I am no expert here, but in general I am extremely suspicious of claims of “statistical significance” that rely on post-hoc rationalizations. The committee was also unimpressed:
The FDA’s own advisory committee voted overwhelmingly that the drug’s clinical trials did not demonstrate evidence of effectiveness (with ten members opposed, none in favor, and one abstention).
Nonetheless, the FDA recently approved the new drug, which will have a $56,000 list price. Given that more than 6 million Americans suffer from Alzheimer’s (a number that is rising rapidly), this decision will have major consequences for health care costs:
The FDA’s approval of Aduhelm is likely to have health policy ramifications far beyond the FDA itself, though. As noted above, the potential financial implications for our health care system are staggering. Medicare Part B spends approximately $37 billion annually on prescription drugs program-wide, and Part D spends approximately $90 billion annually. Given the large patient population and high price tag, it is not difficult to imagine aducanumab alone commanding somewhere between those totals every year—for a drug with extremely limited evidence of clinical efficacy.
I believe that all American should be free to use Aduhelm (aka aducanumab) as long as taxpayers don’t have to pay for it. The more difficult question is whether it makes sense for taxpayers to pay vast sums of money to subsidize drugs that government experts view as having little or no benefit (relative to cost.) I’m skeptical of that idea, although I’m willing to listen to arguments for the other side.
PS. Three members of the FDA advisory panel have now resigned in protest:
A third member of a key Food and Drug Administration advisory panel has resigned over the agency’s controversial decision to approve Biogen’s new Alzheimer’s drug, Aduhelm, CNBC has learned.
Dr. Aaron Kesselheim, a professor of medicine at Harvard Medical School, said the agency’s decision on Biogen “was probably the worst drug approval decision in recent U.S. history,” according to his resignation letter obtained by CNBC.
PPS. I recently appeared on the Bob Murphy Show.