How should you price new therapies when the standard of care is not cost effective?

Let’s say that there is a very severe disease—let’s call it horriblitis—with significant impacts on patient morbidity and mortality.  The only available treatment for horriblitis is drug called BlackPill.  BlackPill improves health outcomes by 1 QALY over best supportive care (BSC), but costs $500,000 over the patient’s lifetime.   While not cost effective by traditional standards,…

Read More