Part of the problem when government pays the health bills is that it undertakes a cost analysis to decide whether it thinks a particular treatment is effective enough for the price. Regardless of whether the patients want the treatment or doctors foresee greater problems down the road, he who pays the piper calls the tune.
Such is the case in the United Kingdom now that the National Institute for Health and Clinical Excellence (NICE) has finalized its proposal to stop paying for various Alzheimer's treatments because they're too expensive. Despite an unfortunately growing list of patients who are developing mild to moderate forms of the illness, and the outrage of doctors who can't prescribe the best medicines to their patients, NICE said the drugs "do not make enough of a difference for us to recommend their use for treating all stages of Alzheimer's disease."
Alzheimer's disease is noted for the slow decline of its sufferers' cognitive abilities in the early onset of the illness and the virtual incapacitation of patients in later stages, which can take years and years to progress. It's no coincidence that Alzheimer's is called the "long goodbye." Aricept, co-marketed here in the U.S. by both Pfizer (NYSE:PFE) and Japanese pharmaceutical Eisai, is the world's most prescribed medication for Alzheimer's. The two companies are mulling a court challenge to the NICE decision.
Also affected are Razadyne, by Johnson & Johnson (NYSE:JNJ), and Exelon, by Novartis (NYSE:NVS). Another drug which had been considered for the ban, Ebixa, by H. Lundbeck, will only be allowed in clinical trials in cases involving moderate to severe forms of Alzheimer's. Ebixa is the trade name for memantine, which is also sold in the U.S. as Namenda by Forest Labs (NYSE:FRX) and is not affected by the decision.
According to the Alzheimer's Society, the prohibition will affect 72,000 patients next year. It would have been much higher, but NICE sidestepped a land mine when it said that those already receiving treatment may continue to do so -- which is really only a politically expedient solution. If the drugs are not effective for new patients, then they are equally non-cost-effective for those already getting the drug. NICE has essentially said it will continue to throw away its money for those already receiving treatment, but it would rather do that than face the wrath of taking away someone's medicine.
These drugs are undoubtedly expensive. The Alzheimer's Society says they cost NICE, on average, $1,670 annually per patient, which means the ruling would save the agency some $1.7 billion a year. Yet while there is no cure for Alzheimer's, there have been numerous other studies which show that the drugs do improve a patient's cognitive abilities. For those who care for an Alzheimer's patient, particularly family members, such improvements, even if temporary, are an immense source of relief and joy.
The decision by NICE seems short-sighted and focused on only one aspect of treatment: cost. It certainly leaves out the human element. Yet that should not be unexpected when you're dealing with an amorphous entity -- known as "government" -- that is ultimately holding the purse strings.
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Fool contributor Rich Duprey owns shares of Eisai, but does not own any of the other stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.
