Tag Archives: Drug Pricing


Consider a case where a patient has a disease with high mortality and no effective treatment available. A new experimental drug is now being tested in a clinical trial. However, this is a randomized clinical trial, which means that it will have a treatment group and a placebo group (that does not get the actual drug). Is it really ethical to include a placebo group in case of a disease with no other treatment options? Are we effectively condemning this and many other patients to death by assigning them to the placebo group – albeit randomly?

In such cases, clinical trial design presents a major ethical dilemma in the area of drug development. This and other ethical dilemmas were discussed at length at a special session “The Bioethics of Drug Development – You Make the Call!” on Monday, June 23, 2014 at #BIO2014 the 2014 BIO International Convention.

Una Ryan from Bay Area BioEconomy Initiative feels that the “old way is broken”. A previous advocate of the randomized control trial, she thinks that in the era of big data, it is possible to design open-label trials with no placebo controls and yet draw meaningful conclusions by comparing data with historical controls (control groups from previous studies and from clinical data on the disease).

Richard Moscicki, Deputy Center Director, Science Operations at the US Food and Drug ADministration (FDA) agrees that randomized control trials may not always be the best way to conduct trials but in some cases, are “the most acute tool” for us to show efficacy and obtain regulatory approval for drugs. A factor that may make open-label trials difficult is the lack of good historical control data in some cases. However, the panelists agreed there is no need for randomized control trials for drugs that have clear disease reversing effects.

Russell Medford from Salutramed Group had similar views and said that randomized control trials, though currently the gold standard, are not always required. He advocates a frank, open discussion with the FDA while designing trials.

All panelists agreed that in today’s age, there is room for innovative trial designs, such as adaptive clinical trials or open-label clinical studies. It cannot be overstated that, especially for patients with lack of treatment options, we need to identify the optimal approach for designing clinical trials and find a middle ground.

Drug Pricing and Ethics

Finally, drug pricing and access is another thorny issue in the bioethics arena. Most drugs that get approved are introduced into the market with an intimidating price tag. But the fact remains that the drug-pricing curve has a sharp rise and a sharp fall. This fall in prices comes as drugs from competitors with similar efficacy enter the market. Prices drop further as generics enter the market once companies lose their sole monopoly over drugs.

Drug Development Bioethics
Drug Pricing and Bioethics (Image Credit: www.atg.wa.gov)

The calculation of drug pricing is aimed at increasing return on investment for a company; drug companies have to consider the cost of successfully bringing a drug to the market – including the failures that never made it past the discovery or early development stages. With these calculations, the price tag on every approved drug ranges from anywhere between $1 billion to $12 billion. From a business point of view, companies need to take into account all these factors for long-term sustainability. Of course, business ethics tend to clash with healthcare ethics, necessitating the search for a middle ground. Most panelists were of the opinion that high drug prices are justified as long as they are “fair”.

There were other ethical issues to be considered too. Would it be prudent to incorporate differential pricing globally or have static pricing? What about pricing for drugs used in rare diseases that have a small market? And what about patients/patient groups unable to pay for the high costs of these drugs? These are some troubling questions that need a lot of thought and discussion among key players globally.

It was clear at this session that there is no one correct answer or solution to either of the ethical issues discussed at this BIO2014 session. These issues lie at the crossroads of business, healthcare, and public health. Stimulating a public debate and encouraging dialogue between the pharmaceutical companies, healthcare professionals, patient interest groups, and regulatory agencies would go a long way in navigating these ethical minefields.