"The drug, also known as sorafenib, extended lives by an average of 2.8 months at a cost of 27,000 pounds ($38,853) for each patient, NICE said. The Leverkusen, Germany-based company had offered to pay for every fourth pack of Nexavar when used to treat hepatocellular carcinoma, a type of cancer that starts in the liver. Few patients with the disease are able to undergo the surgery that could potentially cure them, NICE said." 

Source: Bloomberg

No surprises there really and consistent with the approach the National Institute for Clinical Excellence (NICE) has taken over the last few years.  You can read what the agency had to say on the matter here. Basically, Bayer offered NICE a deal whereby every 4th pack of sorafenib (Nexavar) would be free, but that wasn't enough to sway the decision:

"Sorafenib does not provide enough benefit to patients to justify its high cost."

It's interesting that my US colleagues always point to this kind of decision as evidence of rationing but it's really an access issue based on who holds the budget strings.  

In the US, drugs might get approved at whatever cost the manufacturer chooses for now, but insurance companies and the CMS may put all sorts of strings attached such as certain conditions, formulary tiers, pre-authorisation etc and in the end the patient also has a choice whether they can and want to afford the co-pays that go with those decisions.  They may after all, still say no, that the price asked is too high a price to pay based on their means.  A drug in a tier 3 or 4 category will have a very different co-pay from a tier 2 drug, for example.

Still, in the end, who pays the Ferryman is still the moot point and sometimes Pharma forget that the days of charging exhorbitant prices that neither the healthcare systems nor the people can afford will one day come to end with excessive price charging.  

Ultimately, it's an unsustainable business model that gives Pharma a bad name synonymous with oil and tobacco companies. Perception is reality sometimes. Eventually the actions of a few will affect the sensibleness of most and in the US we will all get to deal with more systematic price controls and constraints based on the likes of health economics, comparative effectiveness and cost utilities etc whether we like it or not.

Outside of oncology, very few companies consistently engage in head to head comparative trials to prove their drug is more effective or cost effective than the standard of care.  This will ultimately change over time as the authorities get tougher.

In the long, the cost of doing business ie conducting clinical trials, will go up and the burden of proof will shift dramatically.

End of life care and treatment raises all sorts of poignant yet important questions.  Do we need a greater focus on wellness rather than palliation? What about research into better models and biomarkers so that earlier detection of cancer, where intervention can have most effect, can be initiated? Should the needs of the few (eg in the end of life situation) outweigh the needs of the many? Given the limited resources available, how best should they be allocated and invested?  

If you look at the Nexavar situation on reflection, how would that $38K be best spent for the greatest benefit given that there isn't a bottomless pit of money?

These are always tough decisions for anyone to make, especially when a relative or loved one may be involved.  Rather than the PR and media hysteria that inevitably follows these sort of rejections, hard and tough though they may be, it would be nice to see a broader public debate around some of the wider strategic healthcare issues facing us all.