Funding cancer drugs will reduce hospitalisations - professor

Funding cancer drugs will reduce hospitalisations - professor

Investing in new cancer drugs will save money down the track with fewer hospitalisations and other medical costs, a visiting professor to New Zealand says.

A new study from American health economist Professor Frank Lichtenberg, which looked at 14 years of publicly available New Zealand data, also shows the country is well behind comparable countries when it comes to introducing cancer drugs.

He will present the Medicines New Zealand-commissioned study findings at the group's annual Parliamentary Dinner hosted by Health Minister Jonathan Coleman on Tuesday.

But he told Paul Henry one problem in the way Kiwis get access to cancer drugs is the way the Government drug-buying agency Pharmac looks at where to put its money.

"Pharmac and other authorities consider the cost of cancer care; they often don't consider that new cancer drugs can reduce other medical costs, particularly hospitalisation.

"In New Zealand, the cost of hospital care for cancer patients is four times as great as pharmaceuticals, so even a small reduction in hospital expenditure can completely offset the cost of the new drugs themselves," he says.

Melanoma sufferers in New Zealand have only recently been given the news Pharmac will fund what some have hailed a miracle drug - Pembrolizumab (also known as Keytruda) - and its competitor Opdivo.

But that only came after a public outcry for the drugs and a $39 million funding boost for Pharmac in this year's Budget.

Keytruda will be available to patients from September, while Opdivo has been on offer since July.

Prof Lichtenberg says New Zealand's been behind in funding such drugs for decades.

"If we look at the last 20 to 25 years, the number of cancer drugs that have been launched in New Zealand is only about half as many that have been launched in the United States and other countries."

He says that means fewer drugs are approved and it takes patients longer to get access to them.

But putting money into new cancer drugs will pay off in the long-run, he says, and an attitude change to the criteria of funding them needs to be looked at.

"The types of cancer where the most new cancer drugs have been introduced have seen the largest reductions in hospitalisation and length of stay and so forth.

"Hopefully studies like mine will begin to alert them to these issues. The costs of new drugs are obvious, the benefits are a little less obvious and they need to be evaluated."

The study says for every dollar spent on a new cancer drug, at least one dollar can be saved in healthcare in the future.

Prof Lichtenberg says that conclusion came from looking at historical records of drugs approved in New Zealand which showed funding those drugs "saved as much money as they cost".

But he was quick to point out that didn't mean that would be the case for every drug.

The results of the study are similar to others Prof Lichtenberg has had published in peer-reviewed journals.