In quality-adjusted life years (QALYs), there is an upper limit to the cost of any intervention because the most you can save from one intervention is one life. If the same money can be used to substantially improve the lives of 100 people with other interventions, then the cost-utility analysis may say a particular intervention is not effective.
You might not like the utilitarian approach but this is how the UK measures effectiveness.
If the cost isn’t reflective of real resource/labor consumption, but instead is a rent on IP (which is partially repaying some fixed R&D investment), it’s not so simple.
Let’s suppose a drug company is setting their price to maximize revenue.
Suppose they make the following projections:
They determine that if the treatment price is $10 million above the actual cost of providing the treatment, 5 people will buy it. $50 million total profit.
If the price is set so the profit per treatment is $1 million, 100 people will use it. $100 million total profit.
If the profit per treatment is $100k, 800 people will use it. $80 million total profit.
If the company isn’t factoring in the value of a life saved, they will pick the $1 million price point. If ethicists then just run with that price, they may come to the conclusion that the treatment isn’t cost-effective. However, they are relying on data that’s an output of a process with conflicting values, and that pollutes the result of their calculation. Garbage in, garbage out. The 700 people who didn’t get treated lose out for a pretty bad reason.
We could imagine a policy where the drug companies are mandated to maximize lives saved when setting prices. One might argue that companies won’t develop as many drugs if profits can’t be maximized. We could adjust the policy to subsidize companies for income lost when setting lower prices. Ie. if the drug company picks the $100k price point to save 700 more lives, the government gives them $20M compensation so they can profit like they would have at the $1M price point. That way society spends the same amount of money on this drug, but more lives get saved. I’m sure there’s a lot of challenges in designing a program like that, but the opportunity to save lives makes it seem worthwhile to attempt.
I do like the utilitarian approach, I just think sometimes you need to look outside the box of do A or don’t do A. If the only options were pay for the treatment or don’t, then Ireland might be making the right call by not paying for it.
Ireland could simply let a local company violate the drug patents. A country like the UK could impose conditions such as profit caps on pharmaceutical companies who base their work on publicly funded research. We could reduce the length of drug patents. There are many, many options besides “role over and let pharma companies charge $4 million/treatment when it costs them $1 million.”
From the article: "Libmeldy is approved for use in the European Union and U.K., although the U.K.'s drug price watchdog initially rejected the therapy due to its hefty list price of £2.8 million ($3.4 million at today's exchange rates), BBC News (opens in new tab) reported in 2022. The therapy's manufacturer, Orchard Therapeutics, then offered Libmeldy to the NHS at a significant discount."
So it does seem like they've already discounted it heavily.
Do you know that they ended up at a “profiteering” price point, or are you just assuming? And you do have to pay the team of researchers to go on a speculative hunt for a cure for a super low incidence disease, if you want them to do it again in the future. If you then turn around and seize the results, you’re not encouraging them to take the risk next time.
They really aren't that rare, and the reason we don't help all of them is not because of a utilitarian decision not to spend money on public healthcare. If you can get your humanitarianism to move that money from corn subsidies and fighter jets to health spending, more power to you.
3,100 cases a year in all of Europe, and 3,600 cases a year in the entire US. That's pretty damn rare really. And it's a genetic condition, which means we should be working to eradicate the problem entirely by screening parents and gene editing ideally making it both rare and increasingly rare from here out.
This isn't actually true. There are thousands of underfunded causes right now, from rare disease research to homeless treatment programs to education of disabled kids.
If you're spending $4 million on this you're either raising taxes again (and government expenditure is already roughly 50% of gdp in most developed European countries, cant go much higher without destroying the thing thats making the taxes) or you're not rehabilitating 5 homeless people, educating 5 special needs kids and discovering a potential new treatment for 1 rare disease.
You might not like the utilitarian approach but this is how the UK measures effectiveness.