Cost of Drugs and Affordability Don’t Always Jibe

July 2016, Vol 7, No 6

An international collaborative pilot study found large differences by country in retail prices for 23 cancer drugs, with the highest retail prices in the United States and the lowest in India and South Africa. Higher prices, however, did not mean that the drugs were less affordable, according to lead investigator Daniel Goldstein, MD, Rabin Medical Center, Petach Tikvah, Israel, who presented the results at the 2016 ASCO annual meeting.

When monthly drug pricing was expressed as a percentage of gross domestic product per capita at purchasing power parity (GDPcap), cancer drugs appeared to be less affordable in low-income countries despite the lower retail prices.

Although the study is informative, the authors were not able to obtain discount prices from the drug manufacturers to factor into their computations.

“The study provides a glimpse into prices and affordability of cancer drugs around the world and sets the stage for further research. However, the implications of our findings are limited, because we were not able to take discounts and rebates into account, which would better predict affordability,” said Dr Goldstein. “Until now it hasn’t been clear what the magnitude of difference in prices is, or how prices in each country relate to affordability. The differences in prices are not proportional to ability to pay,” he noted.

Of the 23 cancer drugs, 15 were generic and 8 were proprietary drugs. These drugs are used to treat a range of cancer types and stages. The 6 countries analyzed were Australia, China, India, South Africa, the United Kingdom, and the United States (Table).


The United States had the highest prices for drugs—generic and patented—as well as the highest affordability per capita. Of note, drugs in Australia cost only 50% as much as in the United States, but affordability was second to the United States. China had the third highest cost of drugs, but affordability fell in the middle range, whereas India and South Africa had the lowest drug prices. India had the lowest affordability, whereas South Africa’s affordability was on par with China’s. Prices were low-to-middle for the United Kingdom, but affordability was the third highest.

The study did not take into account the health insurance systems in the different countries. Depending on the insurance system, the patient may have to bear some or all of the cost of the drugs.

“We need open access to discount prices and transparency—which we did not have. This study raises significant questions, and shows us that knowing the price of drugs is not all we need to know to determine value. Some drugs save lives, while others benefit patients for weeks,” Dr Goldstein said.

“This is an interesting international comparative study. The concept of affordability is novel and adds another dimension to the discussion of the price of drugs, the value of drugs, and whether they are affordable,” said Patricia Ganz, MD, Jonsson Comprehensive Cancer Center, UCLA, Los Angeles, who commented on the study.

“The prices of drugs are putting a significant burden on the healthcare system and on patients. More needs to be done to make treatments more affordable and accessible for all patients,” Dr Ganz said.

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