A new way to evaluate cancer drug prices

As the debate over drug pricing rages on, the price of cancer drugs, in particular, has been a focus. But figuring out how to calculate costs for these expensive, but potentially life-saving, drugs is complicated equation, economists Alice Chen and Dana Goldman write. It’s tricky to find the right metric by which to figure out a cancer drug’s value — and price it.

They propose mean survival gain — that is, the average length of time patients survival after half the trial participants have died — as a new metric to evaluate a drug’s efficacy. The most commonly used metric looks at the median, which ends up obscuring the nuances of a drug’s efficacy, they say.

“We need to take account the mountaintop view, not just the price per square foot,” they write.