Their new medicines work miracles for patients suffering from crippling illnesses, but they come at a staggering cost: tens, even hundreds of thousands of dollars a year for a treatment.
But to the heads of Massachusetts’ most prominent drug makers, the problem isn’t how much the public is paying for their drugs but rather that patients don’t fully understand what they get for their money.
“One thing we haven’t done a good job at is telling the story,” Dr. Jeffrey Leiden, chief executive of Boston-based Vertex Pharmaceuticals, said Monday at a Boston conference on medical innovation hosted by the hospital giant Partners HealthCare. “We need to tell the story of the value of what we do in life sciences because that’s the inspiration for what we’re going to do in the future.”
Leiden argued that what consumers get for their money is profoundly valuable: Many people who would have died of a heart attack a few decades ago, for example, are alive because of heart medications and other treatments.
“I spend a lot of time in Washington talking to politicians about this,” he said. “Rather than pointing fingers at each other, we need to come together as a community and tell that story to the public and to politicians.”
Vertex makes a drug that allows some patients with cystic fibrosis to breathe more normally, allowing them to live more comfortable and productive lives.
Yet like other breakthrough medicines, the Vertex drug is incredibly expensive: $300,000 a year. And the company is developing a new treatment for the disease that is expected to be priced just as high.
Leiden spoke Monday at the World Medical Innovation Forum, hosted by Partners HealthCare. He was joined on a panel of executives by the leaders of Biogen Inc., Boston Scientific Corp., and Massachusetts General Hospital and Brigham and Women’s Hospital, both owned by Partners. They addressed an audience of hundreds of other executives, investors, and researchers.
Not discussed at the conference were the rewards drug executives get for bringing successful but expensive medicines to patients.
Vertex, for example, recently reported that its total compensation to Leiden in 2014 could be as much as $36.6 million.
The pay package includes a retention bonus of nearly $15 million that doesn’t vest for three years and will be paid only if Vertex is profitable for a full year during that period.
The issue of high-cost medicines came under the spotlight last year with the debut of Sovaldi, a breakthrough drug for hepatitis C that cost $1,000 per pill. The drug strained the budgets of health insurers and Medicaid, the government insurance program for the poor.
Several Massachusetts health insurers lost money last year because of the cost of providing Sovaldi to patients.
“Sovaldi got a lot of grief for its price, but it’s a cure,” said George Scangos, the chief executive of Cambridge-based Biogen. “It cures hepatitis C. It’s a remarkable drug.”
Dr. Elizabeth Nabel, chief of Brigham and Women’s Hospital, said the company that makes Sovaldi, Gilead Sciences of Foster City, Calif., should have done a better job of communicating about its costs.
“Sovaldi, we hope, will be a case study of how not to collaborate around pricing and communication,” Nabel said. “We simply weren’t prepared; we hadn’t budgeted.”
Scangos, whose company makes treatments for multiple sclerosis and hemophilia, told the audience that the United States essentially subsidizes drug development for the world.
In Europe, government agencies regulate drug prices, so they’re generally lower than the prices Americans pay.
“If the US paid the same price” as Europe does, Scangos said, “then that would stem the flow of new drugs because it would put such a severe drag on the profitability of the industry [that] everybody would be cutting costs, cutting projects.”Priyanka Dayal McCluskey
can be reached at email@example.com. Follow her on Twitter @priyanka_dayal.