Returns to Society from Investment in Cancer Research and Development

Chandra Amitabh (), MacEwan Joanna P., Campinha-Bacote Avrita and Khan Zeba M.
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Chandra Amitabh: Precision Health Economics, 11100 Santa Monica Blvd Suite 500, Los Angeles, CA 90025, USA Harvard University – Kennedy School of Government, Boston, MA, USA
MacEwan Joanna P.: Precision Health Economics, Oakland, CA, USA
Campinha-Bacote Avrita: Precision Health Economics, Oakland, CA, USA
Khan Zeba M.: Celgene Corporation, Summit, NJ, USA

Forum for Health Economics & Policy, 2016, vol. 19, issue 1, 71-86

Abstract: Background: Since the start of the War on Cancer there have been enormous investments in improving oncology treatment. The return to society generated by this investment is unknown. We estimate the returns generated over the previous four decades and extrapolate future returns from current investment in cancer R&D.Methods: Using data on cancer incidence, mortality, and treatment-specific R&D expenditures from 1973 to 2010, we used regression models and two-sided significance tests to relate investment in cancer treatment R&D to cancer mortality, by tumor type. For investment, we used a measure of the knowledge stock generated by cancer treatment R&D expenditures over the previous 25 years to capture the cumulative benefits of past innovations and advances in treatment.Results: Investment of an additional $1 million in cervical, breast, colorectal, and prostate cancer between 1973 and 1990 was associated with a cumulative return of more than $5 million from cancer R&D by 2010. Through 2010, investment in cancer R&D was associated with average benefits in excess of costs in all but two cancers, ovarian and pancreatic. Regarding future returns, we estimated that each additional $1 million invested in cancer treatment research and development in 2010 will produce over $28 million in value over the following 50 years.Conclusions: The return to society from spending on cancer treatment R&D is large, but varies across tumor types.

Keywords: cancer; research and development; social value (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1515/fhep-2014-0022

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