Cost Of Cancer Drugs Skyrocketing

Rising 15% In Past Year – Five Times Faster Than Other Drugs

(CBS)  For cancer patients, there's good news and bad news: many more drugs to call on as tools to fight the disease, but, at prices that rose 15 percent last year – five times faster than prices for other prescription drugs.

"I'm worried that the cost of cancer care is spiraling out of control," says Dr. Leonard Saltz, one of the nation's top cancer specialists, who sees a crisis looming for patients who may find themselves unable to handle the added cost.

At the same time, some drug companies are chalking up noticeably larger profits.

Genentech, the maker of the cancer drug Avastin, reported record earnings growth Tuesday, checking in with an increase of a stunning 79 percent.

Wall Street Analyst Geoffrey Porges says the key driver for the improved earnings "is the cancer drugs. And what's keeping those cancer drugs going so well – well, part of it is the pricing."

CBS correspondent Trish Regan reports Avastin, for example, costs $4,400 for a one month prescription; Erbitux, from Bristol-Myers Squibb, costs about $10,000 a month.

The pharmaceutical giants say the cost of developing and marketing the drugs, and not their ingredients, are the cause of their painful price tags.

Some of the most expensive prescriptions extend a patient's life by a few months or a year.

"That's really the crux of the problem," says Dr. Leonard Saltz, of Memorial Sloan-Kettering Cancer Center in New York. "For a modest improvement, there's a huge increase in cost."

The industry defends its prices, arguing that while new medicines come at a cost, they remain a very small part of total health spending and a very big part of improving cancer patient's survival chances.

"You can argue that they were the ones that took the risks, committed all the resources," says industry analyst Geoffrey Porges of Sanford C. Bernstein & Co. "But I think there's just a little bit of to and fro about what's reasonable... We're definitely on a collision course."