Innovative cancer therapies

Putting costs into context


  • David Khayat MD, PhD

    Corresponding author
    1. Department of Medical Oncology, Salpetriere Hospital, Paris, France
    • Department of Medical Oncology, Salpêtrière Hospital, 47 Boulevard de l'Hôpital, 75013, Paris, France

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    • David Khayat is Honorary President of the French National Cancer Institute.

    • Fax: (011) 33-142160499

  • I acknowledge Julie Adkins and Lee Baker from Prism Ideas Ltd. for medical writing assistance.


The costs of cancer care are rising, and spending on expensive innovative anticancer agents is likely to come under scrutiny as health care payers are confronted by the challenge of resource limits in the face of infinite demand. Indirect costs account for the major part of total attributable costs of cancer and are dominated by the cost of mortality in individuals of working age (who therefore do not contribute to economic productivity). Although cancer is a leading cause of morbidity and premature mortality, in 2007, it was estimated that cancer accounted for only around 6% of the total health care costs in Europe. It is estimated that cancer drug costs constitute around 12% of total direct cancer costs and 5% of the costs of all drugs. Countries vary in their uptake of novel anticancer agents. However, even in France—a leading nation for the use of these agents—the costs of innovative anticancer drugs accounted for <0.6% of total health care expenditure in 2006. Population-level data suggest that novel therapies have contributed (together with advances in screening and other aspects of care) to improvements in survival from cancer. If this is the case, then the potential reduction in the associated indirect costs could exceed the direct costs associated with the uptake of innovative drug therapies. Further research is required to establish the costs and benefits of novel agents in routine practice. Cancer 2012. © 2011 American Cancer Society.


Cancer care spending rose in many European countries during the first half of this decade.1 Health care payers are challenged by resource limits in the face of infinite demand and the current economic crisis.2 Innovative, molecular-targeted anticancer drugs (eg, rituximab, trastuzumab, and bevacizumab) have roles within recommended treatment regimens for certain malignancies3-6; however, spending on these agents is likely to be scrutinized, because their relatively high acquisition costs are an identifiable target for reduction, whereas their benefits may appear modest.

Cancer Incidence and Mortality

Cancer incidence is rising, with approximately 2.3 million new cases diagnosed in the 25 European Union countries in 2006.7 French data illustrate the rate of increase; the age-standardized incidence of cancer increased by 38% from 1980 to 2005.

Although cancer incidence is rising, mortality rates are stable or decreasing, and survival times are increasing. The EUROCARE-4 study, which included data from 47 cancer registries, demonstrated improved age-adjusted 5-year survival for all cancers diagnosed from 2000 to 2002 compared with the previous decade.8 Particular improvements occurred in colorectal, breast, and prostate cancer patients.7, 9 Reasons for this falling mortality are not clear and may reflect improvements in screening, diagnosis, and treatment.

Despite this favorable trend, cancer caused approximately 1.2 million deaths across European Union countries in 2006.7 Cancer is the leading cause of premature death, being responsible for 1 in 4 deaths among women and 1 in 3 deaths among men.9 Cancers are responsible for 2.3 million years of potential life lost annually in France (Table 1)10, 11 and approximately 10 million disease-adjusted life years lost across the European Union in 2002. This makes cancer third only to mental illness and cardiovascular disease in terms of disease burden.12

Table 1. Cancer Mortality and Potential Years of Life Lost in France in 2002a
 No. of DeathsNo. of Potential Years of Life Lost 
Disease SiteMalesFemalesTotalMalesFemalesTotalAverage Potential No. of Years of Life Lost per Patient
  • a

    Data are presented for the top 10 malignancies in terms of mortality rate (see French National Cancer Institute, 200710).

All cancers90,98961,749152,7381,316,986980,9862,297,97215

Cancer Cost

As President of the French National Cancer Institute,10 I asked leading French health economists to determine cancer costs in France. Their report indicated that these costs can be divided into direct costs (including inpatient/outpatient care, prevention, screening, and research) and indirect costs (including loss of production and productivity). Direct costs evaluate the cost of curative care administered by health care professionals and institutions, eg, costs associated with inpatient care, prescription medicines, and radiotherapy. They do not cover all administered care, and palliative care in particular may not be covered.10 Indirect cancer costs are evaluated using 2 different methods: the human capital method, which attempts to estimate the loss of individual income caused by premature death (or economic costs of the lost years of life) and the of the friction costs method, which measures the loss of income related to the absence of an individual from the workplace.10

Total cancer costs in France were approximately €29 billion in 2004 (Table 2)10; direct costs represented <9% of the total health budget (€140 billion)—a relatively low figure given the burden of cancer. Across Europe, it is estimated that cancer accounted for only 6.3% of health care costs,13 varying from 3% to 5% in Eastern European countries and up to 7.2% in Germany and Sweden.

Table 2. Direct and Indirect Costs of Cancer in France in 2004a
CostEuros (Million)
  • Abbreviations: NCI, French National Cancer Institute.

  • a

    See French National Cancer Institute, 2007.10

Total social security fund budget140,000
Direct costs11,923
 Cost of care10,886
 Prevention (public health policy against cancer)120
 Public funded cancer research670
  State budget324
  Social security302
Indirect costs17,449
 Loss of production 
  Loss of productivity caused by lost work days528
  Loss of productivity attributable to cancer mortality16,921
Total cost (direct plus indirect costs)29,373

Indirect cancer costs in France in 2004 amounted to €17.5 billion (approximately 45% higher than the direct cost).10 Indirect cost is dominated by the loss of economic production caused by premature death; at €16.9 billion, the cost of lost production attributable to cancer mortality in France in 2004 represents 97% of indirect costs (Table 2). This figure far exceeds the direct costs of cancer care (€11.9 billion). Similarly, in Sweden, indirect costs accounted for 70% of total breast cancer costs in 2002. Lost production caused by premature death accounted for 52% of the indirect costs.14 Therefore, dying from cancer costs significantly more than treating this disease.

Across Europe, cancer drugs account for 5% of all drug costs.13 Drug costs averaged 12% of total direct cancer costs, although this varied between 5% and 9% in Norway, the United Kingdom, Switzerland, and Denmark and >20% in the Czech Republic, Hungary, and Poland. Although cancer care often is viewed as costly, the direct per-patient costs (Fig. 1), and the proportion of costs attributed to drug therapy (Fig. 2) are lower than those for other chronic diseases.15

Figure 1.

The mean annual expenditures for each patient treated for cancer are compared with the mean annual expenditures associated with other chronic diseases (based on data from Vallier N, Weill A, Salanave B, et al. Cost of thirty long-term diseases for beneficiaries of the French general health insurance scheme in 2004 [article in French]. Prat Organ Soins. 2006;37:257-28315). HIV indicates human immunodeficiency virus.

Figure 2.

Contribution of drug therapy to total disease costs for cancer and other chronic diseases (based on data from Vallier N, Weill A, Salanave B, et al. Cost of thirty long-term diseases for beneficiaries of the French general health insurance scheme in 2004 [article in French]. Prat Organ Soins. 2006;37:257-28315). HIV indicates human immunodeficiency virus.

Do Innovative Cancer Therapies Offer Value for Money?

It is estimated that the total sales of oncology drugs in 25 countries (including 19 European countries) have increased 5-fold from 1995 to 2005.13 In France, the cost of innovative cancer therapies rose from €335 million in 2003 to €714 million in 2006. According to the French Pharmaceutical Companies Association, in 2006, drug costs in France accounted for approximately 20% of the social security health budget (approximately €28 billion). However, innovative anticancer drugs were responsible for just €0.75 billion, or <0.6%, of this total.

Spending on cancer drugs is expected to continue increasing, although the rate of increase may fall as generic versions of newer therapies are introduced and competition increases.1 The use of more expensive technologies does not necessarily translate into an increase in the total cost associated with an illness. Newer drugs may lower the demand for other medical services (eg, hospitalization),16 whereas increased survival could lower societal costs1—an aspect that remains under researched.17 Moreover, cost-effectiveness of an anticancer agent may improve as it is used earlier in therapy wherein it prevents disease recurrence.18

Do innovative cancer treatments improve survival? Randomized clinical trials have demonstrated statistically significant, incremental improvements in survival with some molecular-targeted agents in certain indications, including lung,19, 20 breast,21, 22 and colon cancers23 and hematologic malignancies.24-27 Epidemiological data also support a survival benefit of newer therapies in some malignancies; data from the Cancer Registry of Norway indicate that the per-inhabitant use of vinorelbine from 1999 to 2005 was correlated inversely with the risk of death in patients with nonsmall cell lung cancer.28 Data from the Surveillance, Epidemiology, and End Results Program in the United States also reveal improvements in the survival of patients with hematologic malignancies.29-37 In some cases, these changes have been attributed to new technologies. However, these data do not allow the direct quantification of the impact of specific treatments. Furthermore, current data analyses to the middle of the current decade do not yet reflect the impact of recently introduced therapies.

Researchers at Sweden's Karolinska Institute analyzed the relation between the availability of new anticancer drugs and the associated effect on survival in 3 different ways.13 First, according to 1 analysis, 44% of the improvement in cancer survival rates from 1992 to 2000 at 50 US cancer centers could be attributed to newer anticancer drugs. Second, 14% to 19% of the intercountry differences in 5-year cancer survival rates across 5 major European Union countries were because of the uptake of newer drugs (after 1985). Finally, these researchers modeled the effect of newer drug “vintages” on cancer mortality (adjusted for age and gross domestic product) in 20 countries from 1995 to 2003; adjusted mortality decreased by approximately 16% during this period, and the use of newer drugs accounted for 30% of this trend (ie, an absolute reduction of approximately 5%).13

The Karolinska study was criticized for flawed data and methodology,38, 39 with more rapid access to innovative drug therapy suggested as a surrogate marker of other factors that prolong survival, including improved diagnosis.38, 39 However, although the Karolinska data have limitations, they are worth considering.


Substantial disparities exist between European countries in per capita spending on novel anticancer agents. According to 2005 data, France, Switzerland, and Austria were the leading European nations.13 By 2005, the use of trastuzumab in France was approximately 50% higher than the European average. Data from 2007 to 2008 suggest that uptake of new agents remains high in France, moderate in Germany and Italy, and low in the United Kingdom.1

Access to new anticancer drugs in France has been improved by several measures. More than 75% of health care funding in France is provided by the National Social Security system.40 Cancer care is covered under the Affections de Longue Durée and French patients receive full reimbursement of their health care costs. In 2004, I persuaded the French government to set up a new locus by which hospitals receive full, unrestricted state reimbursement for costly innovative anticancer drugs. This freed clinicians to prescribe novel agents according to clinical need, although it was contingent on meeting specific criteria with full reimbursement only realized when drugs are prescribed according to the “good use” contract. During the 5 years after the introduction of this legislation, expenditure on cancer drugs increased from €230 million to €1 billion, suggesting substantial under use of innovative therapies before 2004.

Access to an effective drug can be delayed by regulatory approval even when data support its use. In 2005, I lobbied the French government to establish the Temporary Treatment Protocol (PTT) to help prevent delays. The PTT convenes a panel of experts to assess data concerning new indications for drugs that are already approved (eg, in 2005, it was demonstrated that trastuzumab provides significant benefits as adjuvant treatment for breast cancer,41, 42 but it approved only for metastatic disease; therefore, patients could not benefit from these findings pending regulatory review). The PTT panel reviews new data, and, if it expects that a drug will be granted a new indication by the European Medicines Agency, patients are given immediate access in that indication. If the drug gains this indication, then patients continue to be treated. If not, then access is stopped.

In conclusion, the adoption of novel anticancer therapies into clinical practice is vital to reduce cancer mortality rates. The potential reduction in indirect cancer costs could exceed the direct costs of therapy as well as providing patient benefits. In France, where innovative drugs are fully reimbursed subject to a “good use” contract, such benefits were achieved in 2006 using a relatively small proportion of the health care budget. The French health care system differs from that of many other countries, but the key issue is the cost in proportion to the total health care budget, rather than who pays. Crucially, well designed, noninterventional, postapproval studies are required to properly assess the costs and benefits of innovative anticancer drugs.


Medical writing assistance from Prism Ideas Ltd. was funded by Association pour la Vie, Espoir Contre le Cancer.


David Khayat has received consultancy fees from Roche, AstraZeneca and Sanofi-Aventis.