IDEAS home Printed from https://ideas.repec.org/a/taf/ecinnt/v18y2009i5p407-428.html
   My bibliography  Save this article

The effect of new cancer drug approvals on the life expectancy of American cancer patients, 1978-2004

Author

Listed:
  • Frank Lichtenberg

Abstract

This study attempts to determine the extent to which new cancer drugs introduced during the last 40 years have prolonged the lives of Americans diagnosed with cancer. We use a difference-in-differences approach: we analyze the correlation across cancer sites (breast, prostate, lung, etc.) between changes in the hazard rate of people previously diagnosed with that cancer and changes in the number of drugs that have been introduced to treat that cancer, controlling for variables likely to reflect changes in diagnostic techniques: cancer stage distribution, age at diagnosis, number of people diagnosed (incidence), and use of surgery and radiation. The rate of introduction of new cancer drugs varied considerably across cancer sites and over time. Data on cancer-site-specific drug introductions are constructed using the National Cancer Institute (NCI) Thesaurus and the Drugs@FDA database. Data on all other variables were obtained from the NCI's surveillance, epidemiology, and end results 9 Registries Database, an authoritative source of information on cancer incidence and survival in the USA. We find that the effect of the lagged stock of drugs on the hazard rate of cancer patients is negative and highly significant. This signifies that cancer sites with larger increases in the lagged stock of approved drugs had larger reductions in the hazard rate, ceteris paribus. The impact of the stock of Food and Drug Administration (FDA) approvals on the hazard rate tends to increase steadily for a number of years, peak about 8-12 years after launch, and then decline. This finding is consistent with evidence about the product life cycle of cancer drugs: utilization tends to increase steadily after FDA approval, peak about 6-10 years after launch, and then decline. The cancer stage, the age at diagnosis, and incidence variables have the expected effects on the hazard rate. New cancer drugs introduced during the period 1968-1994 are estimated to have increased the life expectancy of cancer patients by almost 1 year (0.94 years). Although the health of cancer patients is less than perfect, the increase in quality-adjusted life-years is not necessarily less than the increase in life expectancy. Since the lifetime risk of being diagnosed with cancer is about 40%, the 1978-2004 increase in the lagged stock of cancer drugs is estimated to have increased the life expectancy of the entire US population by 0.38 years. This represents about 8.8% of the overall increase in US life expectancy at birth. Estimated cost per life-year gained does not exceed $6908, which is far below recent estimates of the value of a statistical life-year.

Suggested Citation

  • Frank Lichtenberg, 2009. "The effect of new cancer drug approvals on the life expectancy of American cancer patients, 1978-2004," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 18(5), pages 407-428.
  • Handle: RePEc:taf:ecinnt:v:18:y:2009:i:5:p:407-428
    DOI: 10.1080/10438590802547142
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/10438590802547142
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Frank R. Lichtenberg, 2015. "Pharmaceutical Innovation, Longevity, and Medical Expenditure in Greece, 1995-2010," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 22(2), pages 277-299, July.
    2. David H. Howard & Peter B. Bach & Ernst R. Berndt & Rena M. Conti, 2015. "Pricing in the Market for Anticancer Drugs," NBER Working Papers 20867, National Bureau of Economic Research, Inc.
    3. Lichtenberg Frank R., 2010. "Are Increasing 5-Year Survival Rates Evidence of Success Against Cancer? A Reexamination Using Data from the U.S. and Australia," Forum for Health Economics & Policy, De Gruyter, vol. 13(2), pages 1-18, August.
    4. Lichtenberg, Frank R., 2014. "The impact of pharmaceutical innovation on longevity and medical expenditure in France, 2000–2009," Economics & Human Biology, Elsevier, vol. 13(C), pages 107-127.
    5. repec:bla:ecorec:v:93:y:2017:i:302:p:353-378 is not listed on IDEAS

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:ecinnt:v:18:y:2009:i:5:p:407-428. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/GEIN20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.