Apparently there is an ongoing debate in ophthalmological circles about using Lucentis or Avastin to treat macular degeneration. These are two closely related drugs, both made by Genentech from the same molecule. Avastin has been approved for treating various cancers, but ophthalmologists have evidently been using it off-label for a while to treat macular degeneration. This off-label use is one of the reasons Genentech produced Lucentis, which has been approved for macular degeneration.
Why is this relevant to health care reform? Because Lucentis costs thousands of dollars per dose while Avastin costs less than one hundred dollars. Even worse, as I was told by an ophthalmologist over the weekend, insurance policies keep even those doctors who are worried about costs from using Avastin. Doctors pay $50 for a dose of the drug, but only get reimbursed $7, so they are losing $43 per treatment. If they use Lucentis, they get full reimbursement. One might argue (in fact, I probably would) that the ophthalmologists are making so much charging for the treatment that they should eat the $40 loss, but I doubt many of the doctors will listen.
I know that there are many complexities here: you can’t expect insurance companies to fund the use of unapproved drugs, and you want a drug approval system that errs on the side of safety, and there hasn’t been a head-to-head trial to see if Avastin is fully equivalent to Lucentis. But surely there is a middle ground, where drugs are sufficiently vetted yet we are not incenting doctors to prescribe thousand dollar drugs instead of fifty dollar drugs.