Why is CAR T-Cell Therapy So Expensive?

If you know anything about chimeric antigen receptor T-cell therapy (CAR T-cell therapy), you’re likely to know it’s expensive. Like crazy expensive. When I was offered my treatment, the estimated price was $1 million – and that was even WITH being in a clinical trial. It’s an eye-watering amount of money, and well beyond the reach of most people without substantial help.

What CAR T-cell therapy cost me

In my case, as a foreigner in the U.S. medical system (I live in New Zealand and was having to travel to the U.S. for treatment), there was no health insurance company, no government support - just friends, family, savings, and loans. The clinical trial meant that the pharma company paid for some of the costs – but not all of them.

We’ve had to cover the travel and accommodations (12 trips so far from New Zealand to Boston, and over 5 months in total staying there), plus the hospital costs, time off work, etc. etc. In some trials, the pharma company will pay for the hospital costs, and possibly even the out of pocket travel, but my trial didn’t include those benefits.

At one point, we thought we’d have to sell our home to pay for the treatment, but luckily, in the end, we managed to not have to do that – because my life insurance policy gave us a payout. All in all, I was extremely lucky to get the treatment without going broke, but I am also very aware that for many people, the current cost of CAR T-cell therapy is simply out of reach. The final estimated bill for me is around $250,000 – and I consider that low.

Why is it so expensive?

Like all new pharmaceutical products, the economics of how the companies get their products to market means they take on enormous costs and risks before they ever get a product approved. One pharma exec told me it wouldn’t be unusual for his company to spend $800 million or $1 billion for a novel treatment, to do all the science, research, approvals, etc. – and even then, they always wear the risk that the product simply might not be approved, or might not work at scale. So, in some ways, ALL new products need to be able to pay for their own development, and also a proportion of the development of products that don’t make it to market. Now, I’m not asking for too much sympathy for the pharma companies here – they do OK, as we all know – but it does explain some of the cost issues.

CAR T-cell therapy is different than other treatments

For CAR T-cell therapy, there is an extra compounding factor. Most ‘drugs’ cost an enormous amount to develop, but then are relatively very cheap to manufacture at scale. Once you have the chemical formula right for a pill, then getting the manufacturing process going to make a million of them means the cost of each pill can be small.

That is not the case for CAR T-cell therapy. It’s a fundamentally different approach – it’s not a ‘pill’ as such, it’s a process. Each patient’s own cells need to be painstakingly treated, in a very labor-intensive way, and quality checked, administered, etc. There aren’t corners that can be cut. Getting CAR T-cell therapy isn’t like buying a pill, it’s more like going to a fancy restaurant and ordering a special meal. It takes time for the chef to get the ingredients and make the meal especially according to your taste. If someone else in the restaurant orders a similar meal, it doesn’t really make it any cheaper – the chef still has to cook their meal separately, too.

Then there is the extra compounding factor that this treatment is new, and the hospitals and clinics that are administering the treatment also have costs. Carrying on my analogy of the restaurant from above, there are the costs of the waters and the front of house staff. In the hospital, there are extra scans, overnight costs, special medication for the preparation, drugs to manage side effects if they occur... all of this needs to be paid for, too. When I had my treatment, the pharma company paid for all their costs to manufacture my cells, but I personally had to pay for all the hospital costs. That added up to well over $100,000 in my case, and I have heard of cases where there were side effects to the treatment and the hospital costs got close to $500,000... a pretty expensive restaurant!

Hopefully the cost will reduce

Now, if all of this is putting you off, let me assure you, there is hope for this treatment to drastically reduce in cost, and I look into this in another article.

I’ll also point out that each situation is unique – CAR T-cell therapy is now a ‘standard of care’ option in some countries; meaning, that insurance companies, or even governments, may pay some of (or all of) the costs. So don’t panic and look into which option might work for you.