Who Should Pay the Bill for Wonder Drugs?

In 2010 the first oral medication for multiple sclerosis became available, a pill from Novartis called Gilenya. At about $4,000 a month, it was the most expensive treatment for MS. Now it’s the cheapest. “When it came on the market all the older drugs raised their prices,” says Ted Thompson, vice president of federal government relations at the National Multiple Sclerosis Society.

Breakthrough medications that cost tens of thousands of dollars or more a year are becoming common for treating chronic conditions such as MS, cancer, HIV, and hepatitis C. In coming years dozens of new specialized medicines are expected to arrive with similar price tags. The U.S. health-care system has yet to sort out who will pay for them, and how much. It’s a question that’s pitting drug companies that develop medicines against the insurance companies and government programs that buy them—and leaving patients caught in the middle.