Many people are questioning why American regulators approved it.
There’s a new drug for Alzheimer’s, a debilitating and devastating form of dementia which slowly eats away at its sufferers’ memories and minds. It’s called Aduhelm, and it is the first new treatment for the disease since 2003. It has just become available in the USA, but there are two major problems with Aduhelm that may make health ministries in other countries reluctant to sign off on it.
The first problem is that it’s really, really expensive. It costs $56,000 (that’s about £40k) per person, per year. It’s also not a cure, so it has to keep being administered for life. Alzheimer’s is a relatively common condition, particularly amongst elderly people. There are estimated to be 6 million Americans living with it, although at the moment Aduhelm will only be offered to those who have early or mild cases of the disease. But that’s still about 500,000 people, which would lead to a total bill of about $29 billion a year.
For many patients and their loved ones, any cost would be worth it to avoid an irreversible destruction of their personhood. Plus, Alzeihemer’s itself carries financial costs. Sufferers cannot usually engage in any economically beneficial activity, from paid labour to unpaid childcare. They often require care, which means either hiring in outside help (which is expensive) or family members providing the labour for free (and sometimes having to give up paid work in the process).
On the other hand, the costs of Aduhelm are unlikely to be borne primarily by patients. Although America does not have universal state healthcare, the government does pay for the majority of the medical costs of many elderly Americans, via a programme called Medicare. (Medicare recipients usually still pay about a fifth of their own medical bills.)
The cost of Aduhelm is equivalent to more than three-quarters of Medicare’s entire spend on doctor-administered drugs in 2019. So in order to pay for this new drug, the American government will have to do one or more of the following: spend less money on other treatments; spend less money on other government programmes; take out more debt; raise taxes; or increase the percentage of their healthcare bills that Medicare recipients have to pay for. All these options will cause some people to lose out. Moreover, all of these options are likely to cause poorer or more vulnerable people to particularly lose out. After all, it’s those with poorer health or poorer finances who are most likely to be dependent on government programs and Medicare treatments, and who will struggle the most if their bills increase.
Some people argue that the American government could mitigate these problems if it wanted to. It could raise taxes that mostly affect the rich, for example. Or it could try to decrease the cost of Adulhelm by going after the drugmaker who set that $56k price in the first place. Biogen, which makes Adulhelm, is a private company, which means its primary aim is to make profit. For Biogen, charging the absolute maximum its customers would be willing to pay is good business sense. But the American government has the power to change that calculation, because it can do stuff like put taxes on the company and pass legislation that the company would have to comply with. And in fact American politicians are currently debating a bill that would allow the government to negotiate more favourable drug prices.
But that brings us to the second problem with Adulem - there’s no proof it actually works. Although it has been shown to remove a brain plaque that scientists think might cause Alzeihemer’s, it has not met most of the usual criteria for drug approval. It may not even be harmless - about a third of patients who take it experience brain swelling. Plenty of experts are flummoxed that it’s been allowed to go to market at all. Of course, desperate times call for desperate measures, and the severity and terminality of Alzeihemer’s means there’s less to lose from injecting its sufferers with an experimental drug. But it does add weight to concerns about whether the huge costs of the treatment are worth it.
Read our explainer on: opportunity costs