Opinion: Accounting for hope: using ‘mean survival gain’ to price new cancer drugs
Just as price per square foot won't tell you if a house has amenities like a mountaintop view, median survival gain is blind to longer-term gains in survival offered by…
Outrage about the rising prices of prescription drugs has put cancer drugs in the spotlight. But there’s an important question that needs to be asked: What is the best pricing metric to use for them?
Economists like us spend a lot of time worrying about this in a more general context. When the government computes its consumer price index, for example, it thinks about the quality of the goods that households purchase. A computer purchased 10 years ago is almost unrecognizable compared to one purchased today, so the consumer price index must adjust for CPU speed, memory, storage capacity, and more.
