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How Much Would You Pay For A Year Of Life?

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Two years ago, a group of doctors did something unprecedented - they boycotted a cancer drug because, given the benefit, it cost too much. Following up on the story, Radiolab producer Molly Webster discovers this is far from your normal drug pricing story. It's long been taboo to talk about cost and care in the same breath. But we enter a space where economics and philosophy sit side-by-side, and raise a deeply uncomfortable question: what is a year of life worth?

Produced by:

Molly Webster

Comments [28]

Econometrics has looked at this issue through both peoples actions (revealed preference) and through surveys (stated preference). In fact, governmental agencies in the US assign values of a human life when doing cost-benefit analysis for policies or other investments such as infrastructure. There is also a concept called quality adjusted life years (QUALY) the is used to assess the value of medical interventions. This information really should have been part of this report. I say this while also knowing that economics and econometrics is neither sexy nor easy to understand.

I actually enjoyed the worth podcast, so don't misinterpret my complaints as hating this podcast or radiolab generally. I think this podcast illustrates a role for government to buy the patent for these drugs. The difficult part to define is how to price these drugs while maintaining a balance between incentivizing pharmaceutic companies to study disease with huge risk/expense and ensuring the public good. There are other examples of government agencies doing this sort of thing in the case of natural monopolies. It seems that the ideal outcome would be a global purchase of patents for drugs curing diseases to ensure the appropriate incentives and public outcomes.

Feb. 23 2016 02:26 PM

Again I just want to voice the same opinion as a lot of people here about this episode which I thought, very unlike Radiolab, blithely missed the whole point that big pharma are in the business of making money not helping people.

And that's okay, go ahead charge a $1000 a pill but at some stage when you have recouped your costs you reduce your price or you and your board go to jail for price gouging.

Aug. 02 2015 03:09 PM
Carl from Boston

Thanks for the program.

I kept waiting to hear someone mention the fact that there is at least one English-speaking government organization whose job it is to consider worth in the context of medical costs: The UK National Institute for Health and Care Excellence (NICE), which, among other things, estimates cost per quality-adjusted life year gained for different medical interventions.

http://en.wikipedia.org/wiki/National_Institute_for_Health_and_Care_Excellence#Cost_per_quality-adjusted_life_year_gained

Thanks to Stewart from Seattle, WA for pointing out the World Health Organization (WHO) cost-effectiveness thresholds, which I hadn't heard about.

Feb. 24 2015 11:06 AM
Kris from Port Townsend, WA

I was astonished that there was no discussion of why we allow pharmaceutical companies to control our "healthcare" system. These companies take drugs, often developed at public expense in our universities and the N.I.H., and market them for their own profit. Big Pharma spends more money on lobbying our government, and on marketing drugs to the public than they do on research, and reaps incredible profits. From 2003 to 2012, the 11 largest drug companies made a net profit of $711.4 billion.

Let's think about that. A net profit of $711.4 billion!!!!!! Remember that "net profit" means "the bottom line." That is to say, the net profit is what's left AFTER ALL THE EXPENSES have been subtracted.

Instead of discussing how we can manage to afford to keep supporting price-gouging by the corrupt pharmaceutical industry, you should have been investigating why we are at the mercy of such a corrupt industry. (Hint: Big Pharma spends more billions on lobbying and contributions than any other industry.)

Feb. 22 2015 06:48 PM
Mike

You missed a very important point in the segment about Sovaldi, which is that the "discovery" was heavily subsidized by the taxpayer via the NiH. In India, the generic costs far less than charged here in the US under our monopoly pricing system. In other words, we are being gouged for a drug we essentially made possible through government grants for basic research and development. Nice gig for the drug companies.

http://www.huffingtonpost.com/jeffrey-sachs/the-drug-that-is-bankrupt_b_6692340.html

Feb. 22 2015 06:23 PM

Healthcare - among many other parts of our lives collectively and individually, should not be commercialized for profit, IMO. Once we think of "costs" outside of our commercialized, profiteering system, it's an entirely different conversation.

Feb. 21 2015 01:21 PM

I agree with several of the above comments that essentially question your uncritical acceptance of the US system of health care (including pharmaceuticals) that prioritizes the profits of private corporations over human health and life. Human life does not have a dollar value, period, despite capitalism's insistence that we all be reduced to objects of material production and consumption. I literally felt queasy listening to this program in which the monetary value of a human being was discussed as if it were an entertaining, reasonable or clever concept.

Feb. 14 2015 12:03 PM
James from Austin from Austin

The questions in this story are no different from any other question of "What is it worth?" The answer is elusive and somewhat magical and highly subjective. Which is why you need free markets to determine them.

Questions Not Asked:

1) If you knew you would almost certainly die in a year, how much money for your estate (tax-free) would you accept to check-out now?

2) Rather than how much would you pay for an extra year for YOU, how much would you pay for an extra year for that guy over there that you don't know? The answer would depend on a lot of things, including whether he was a good person or an exceptionally productive person.

I also thought it was interesting that patients got so outraged over having to pay $84,000 a year for a drug that didn't even exist until today, and could not exist without the prospect of making $84K per year per patient. Why get mad? Just say to yourself, "I don't have $84K. So, for me, there is no such drug."

Feb. 13 2015 04:18 PM
John F. from Philadelphia

Great show... I'm only about halfway through, so this point might be in there... but one other consideration on placing a $ amount on extra time... is what that money would do if I didn't use it. Would it help my wife survive after I'm gone? Would it help put my kids through college more easily? Losing the extra time with them would be worth knowing they're better cared for. And of course, this is a consideration one could extrapolate to a nation... where, not necc. with "death panels"... those opportunity costs do have to be considered, if we're a compassionate people... don't they?

Feb. 09 2015 07:53 AM
Sir Lancelot from my desk

This is more of an ethical debate than it is a moral debate. I believe when it comes to people's lives and there is not enough money to give it to everyone, than it should very well be selective in who receives the drug. With saying that, those worthy of receiving the drug should be within age restrictions and how they contribute to society as a whole. In a way we are playing God, but if someone will get the drug to live longer, i would rather it be a doctor than a drugie.

Feb. 02 2015 07:08 PM
Robert Guenther Ph.D. from Florida

A grad student in our program sent me the link to this piece. It was interesting and, IMHO, very useful, to produce this piece. I'm a bioethicist among other roles. It amazes me the extent to which so many patients and family members are completely unable to comprehend that the patient is dying and nothing can reverse the disease. I imagine my death probably every hour of every day, as I see so much disease and death. I was recently told I was almost surely dying of heart disease. My question was, "How soon?" My wife and I went home and I began giving her passwords to everything, instructions on everything, preparing her to be alone. We also cried. It was a false alarm. I LIKED that the reporters asked people in Times Square - not bioethicists - what a year of life is worth. Almost no one cares what bioethicists say. It does matter whether or not the people of this country can even begin to answer the question. If they can't, they won't be able to make any end-of-life decisions. So, in my case, my impending death was a false alarm, but only in the sense of the time line.

Jan. 22 2015 11:28 AM
Sloppy from Sweden

Why is it not a consideration that the Pharmaceutical industry is to blame for excessively high prices. Sure, you have some info as to why but then why are they making SO much money? A very uniquely American issue.

Jan. 19 2015 04:28 PM
DW from Montgomery, Alabama

I was dismayed to hear, "Holy sh--" by your reporter at 21 minutes into your otherwise intriguing program about how much a year is worth. I stopped listening to the podcast at that point.

I thought that journalists had higher standards.

Jan. 17 2015 03:09 PM
Lauren from Australia

Man!
I'm surprised that no one really addressed the issue of the health system in USA being really unique in developed nations in that it has practically no public health care. Because I feel like a lot of americans don't realise this.

It's not normal!!! There's something terrible going on in the USA in that there is not public health care. Young people dying of cancer and other treatable diseases, who should have had full lives ahead of them who had no money for treatment, who if they had been born in NZ, Australia, UK, Canada, Europe, pretty much anywhere else that's not third world, would not be dying!!!

The government just leaves it's own citizens to die. (While spending money on occupying and bombing other countries citizens.)

And you guys didn't even talk about that. You acted like it was so normal. Your supposed to be educational. And this episode was a little bit educational. But it also added to the insular mindset, ignorance and diminishment of the power that awareness brings. A power that would see more people in the USA demanding public healthcare.

Jan. 17 2015 12:08 PM
Alan from CA

I listened to this section of the podcast wondering about a couple of points. One - the cost of a drug should be a fairly temporary issue - shouldn't the patents expire after a number of years? (given you still have to answer ethical questions in the meantime)

If drugs cost so much socially from private companies - why not just allocate the societal cost to developing them directly in the first place, with private companies just competing to produce the publically researched drugs. You then cut out all the costs of marketing as well as much profit motivation to inflate the effectiveness of a given drug (or even the motivation pursue temporary drug therapies above outright cures...) Put more simply - if a private path isn't producing efficiently - why not consider a public path to researching and creating drugs.

Jan. 14 2015 12:30 PM
Kj from St Andrews, UK

Had a surprising moment of synchronicity while listening to this episode last night. I was listening to "Worth" on my 30 minute walk home from my doctoral research office (I'm doing work on the fiction of Charlotte Bronte and Feminist Theology) and as I was listening, I was also doing the mental sorting one does in their head about what to follow up on tomorrow. As I was debating if I needed to go back and spend a few hours typing up my notes on "Madwoman in the Attic", the touchstone work of feminist readings of 19th literature by Sandra M. Glbert and Susan Gubar, Susan Gubar started talking on the podcast. I hadn't revisited Gubar's material (or my need to revisist it) until that day, and now I was hearing the very woman I was thinking about talking from my iPod. I wasnt aware of her cancer battle or her recent writing. It was rather a humbling/humanizing moment, where my tallying 'to do' tasks became hearing one of those academic names transform into a person talking intimately about suffering/surviving. A good moment.

Jan. 14 2015 07:43 AM
Michael from Berlin

This episode was a mixed bag. Susan Gubar was thoughtful and added real insight. (Her last name is Gubar, not Gruber; since this is not live radio, it could easily have been corrected.) But the faux ignorance of the reporters (I hope it's faux) is really becoming grating. Did it really occur to no one on the show that there are people who have thought deeply about the value of human life, people working in bioethics, for example? Is the best way of getting insight into the question to walk into Times Square and asking people on the street?

If you wanted to know how best to organize a system of governance or how to detect a new particle, would you go and ask people in Times Square? This is not to say that ordinary people cannot have valuable opinions about these issues. But sticking a microphone into someone's face and asking them to come up with a considered answer to the question of the value of life is just setting them up. To their credit, most respondents we heard seemed to have realized this and responded far more thoughtfully than the question deserved.

Radio Lab feels more and more like a grab bag, not of topics (I like the fact that anything can become a topic for a show) but of how topics are handled. How a topic is discussed and developed feels less and less surprising to me and more and more arbitrary. Recently, more often than not I come away *thinking* I have gained insight into something but then realize that I witnessed a jumble of ideas (along with irritating sound effects). Too bad, since I always looked forward to new episodes of this show.

Jan. 12 2015 10:43 AM
helloannies from Oregon

This was a very thought provoking episode. I have my own vices, and the results of these would likely be covered by insurance - IF I was actually insured at this point, which I haven't been in these last few years. I think, with the many expenses of R&D for prescription drugs, they have a valid price concern (not sure it's fair, but certainly a valid expense.) We as individuals don't generally take decent care of our health, and a good part of that expense should (though I'm super scared by it) be our individual responsibility (see diabetes, lung cancer, cirrhosis, etc.) - not society's expense (some people take better care of their health!) Those are well known risks! Most choices we make ourselves, and sickness or health we should continue to be informed of the risks and values of our actions and treatments, and there are consequences for many of us to face. When I'm older I may face mine ...but I won't be surprised - and I'm not insured or on any government support, social security will be gone by then, so it'll be all on me, and bittersweet for sure. I'd rather my taxes be spent on the medical care of our youths, rather than keeping my earned physical expenses at bay ...and I am unbiased, as I don't have children.

Jan. 10 2015 11:07 PM
Scott Ralph

Good podcast - especially the Susan Gruber portion.
However, Molly! "Times out" is better described as "multiplying", and "gobblygooky" just made me cringe.

Jan. 09 2015 08:46 AM
Jo from London, UK

Great podcast- and the first that has driven me to comment. Maybe this is because I live in the UK and have the luxury of free health care, but I was quite surprised that there was no discussion or comment who is valuing life here. It is absolutely outrageous that drug companies charge this much for life-saving drugs, it is them who is putting a value on life to make profit rather than society.

There didn't seem to be any discussion around this, only an acceptance, that drug companies can charge whatever they like. It is just not true that R&D of all drugs is so expensive that they need to pass on these costs to the customer, when you consider the unbelievable profit these companies make. http://www.doctorswithoutborders.org/article/rd-cost-estimates-msf-response-tufts-csdd-study-cost-develop-new-drug

Check out MSF Access Campaign - it doesn't have to just be for people living with neglected diseases.

Jan. 07 2015 08:45 AM
Stewart from Seattle, WA

To EG from NYC, regarding your question about the World Health Organization (WHO) cost-effectiveness thresholds, please consult the following page: http://www.who.int/choice/costs/CER_thresholds/en/. On that page, you will see that the WHO actually has three classifications: "Highly cost-effective (less than GDP per capita); Cost-effective (between one and three times GDP per capita); and Not cost-effective (more than three times GDP per capita)".

Jan. 06 2015 07:36 PM
EG from NYC

Can anyone find confirmation that the World Health Organization suggests that "countries spend 1-3 times the GDP per capita" [16:05] for "one more good year of life"? I can't seem to find a WHO publication or article with that conclusion.

Jan. 06 2015 10:29 AM
Steve Kay from Portland, OR

If the question is what society — American society, in this case — is willing or able to pay to save lives, then we must consider the amount of money America is spending to take lives, and to threaten to take lives. In other words, we must consider how much money is spent on the military and on weaponry.

We might also consider how much money is being spent to build prisons and to continue to incarcerate more people than any other country on earth.

The folks behind Radiolab are being narrow-minded, at best, by not considering this broader context.

Now admittedly, I would not want to hear a simple, unexamined statement that "if we only spent less on X, we could spend more on Y." But I think Radiolab could do better than that. At least I think that Radiolab could have come up with a specific, realistic, and thought-provoking proposal involving a reduction in military spending AND a negotiated price with the pharmaceutical company. That might have broadened people's thinking, not narrowed it.

Btw, did I miss something while writing this, or the Radiolab host not mention the fact that Medicare Part D forbids the government, with the exception of the Dept of Veteran's Affairs, from negotiating lower prices from drug companies? This is significant, to say the least.

Here's what Wikipedia has to say on the subject, in a webpage describing the significance of Part D:

"By the design of the program, the federal government is not permitted to negotiate prices of drugs with the drug companies, as federal agencies do in other programs. The Department of Veterans Affairs, which is allowed to negotiate drug prices and establish a formulary, has been estimated to pay between 40%[25] and 58%[26] less for drugs, on average, than Medicare Part D."

Enough said.

Jan. 05 2015 12:34 AM
Maya from LA

Wonderful episode. Tremendous insight from you, Don. Thank you for sharing that story.

One thing really bothered me--as a physician and public health student, this particular point of the "death panel" was really poorly handled, even in passing. "Death panels" have nothing to do with deciding the value of a human life. That particular part of the ACA did this: reimbursed physicians for having end-of-life conversations with their patients. This is an EXTREMELY important part of good medical care. When it comes down to talking about feeding tubes, breathing tubes, chest compressions, every single person deserves to have had a conversation with someone who knows medicine AND knows them. So I find it irresponsible to mention "death panels"--twice--in a podcast without clarifying what they actually are--not about rationing care but rather improving end of life care, aligning our payment structure with our values as a society. Otherwise, don't mention the death panel at all. You propagate the misconception otherwise--and I think if Radiolab has been about anything, it is about exploring curiosities, not misunderstanding.

As a side note, I think it would have been worthwhile to mention that "research and development" constitutes an average of approximately 40% of costs as an average of the top ten pharmaceuticals in the country. Their profits? 30%.

Jan. 04 2015 11:28 PM
Keiron from Sydney

Great podcast as always, guys.
I feel the subject deserves a revisit to explore the other ways in which society values lives. In hazardous workplaces (e.g. Oil and Gas or Construction), executives make decisions about how much budget to spend on health and safety. It isn't possible to be 100% safe and incremental improvements are often exponentially more costly.
Government transport departments make budget and societal choices about how safe to make infrastructure like roads and rail (e.g. whether to build a pedestrian crossing at a black spot), and on how much budget to spend on maintenance.
All these choices require an economic understanding of how to value of life. In the UK this value is also supported by legal precedent.

Jan. 04 2015 03:56 PM
ron from seattle

Let's turn the question around. Instead of how much would I pay for a year of life make the question 'how much would you sell a year for?' Not knowing at this moment if I will live another day or live to be 105 would I sell a year or more? If I know I am going to live to be 105 I might be willing to sell the last 5-10 years. If I'm only going to live five more years I might sell one at a high price so I can do all the things I would like before I die. Not knowing obviously complicates the question. I wouldn't want sell a year if I then find out I only have 53 weeks left.

Dec. 31 2014 02:00 PM
neal from maryland

If someone wants to even consider the value of a life, one way a assigning a value to life would be; estimating the cost of incarcerating a murderer that took the life of someone. That to me seems like a real life value of how much a human life costs.

Dec. 31 2014 09:32 AM
Don from Hershey, PA

Throughout 2013, I took my wife to Memorial Sloan Kettering to participate in Phase II and Phase I clinical trials. By this time, her cancer experience was eight years old and her chondrosarcoma had spread to her lungs. We knew this was a desperate and costly venture. We hoped for a miracle, but we knew we were striving to help future patients. If nothing else, we were hoping for more time. Another year? Sure. That year cost us about 30% of our annual gross income. We were fortunate to be able to find a charity that helped alleviate the costs of travel. Still, I was close to maxing out credit cards. In addition to pursuing charities, I was starting to investigate loans. I would have spent all I had and borrowed more. She died this past February. If treatment could have kept her alive for one year more, I would spent whatever I could. I'd give up my home for that year.

Dec. 29 2014 09:48 PM

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