Pricing and Paying for Cancer Drugs

The US system for pricing and paying for cancer drugs is badly broken. The evidence is all around us-whether we focus on total spending, the breathtakingly high prices for chimeric antigen receptor T-cell therapy, the exceedingly high prices for many recently introduced drugs that offer only marginal improvements over existing treatments, or the increasing unaffordability of patient copayments. These problems are compounded by the distortions created by our payment policies, which do not take account of the value of competing treatment options and are structured in ways that distort physicians' incentives. We review the key drivers of cancer drug spending and consider the trade-offs of various policy options for addressing this problem.