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Personalized Medicine is Great for Patients but Bad for Business

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The genius of Henry Ford was in his perfection of mass production. Ford’s assembly lines produced oodles of Model T cars, with economies of scale, so that the cost of each car fell to a point that even those working in the assembly lines could afford them. His method was copied by other car manufacturers and ultimately by other industries as well.

The pharmaceutical industry was one of them. The industry mass produces medicines that can be given in the same dose, frequency, and strength, irrespective of the patient’s ethnicity, body weight, height, or gender. This assembly line keeps the cost of medicines below what they could have been (though Americans do pay a lot more than citizens of other countries, mainly due to marketing tactics). It is largely due to the pharmaceutical industry that humans’ longevity has increased exponentially over the past century. And, in turn, has made the pharma/biotech sector among the most profitable.

However, a wrinkle has shown up. Most low-hanging fruits that synthetic chemistry could conjure have been picked. The industry has moved to biologics, which are more expensive to make. Nevertheless, they can still stick to the Model T paradigm. But, since science is restless, the boundaries are being pushed, and the concept of personalized medicine is now being increasingly touted.

Perhaps CAR-T-cell therapy best exemplifies personalized medicine. It is now routinely being proposed for cancers and even autoimmune diseases like lupus. CAR-T-cell therapy is a way to get T cells to fight cancer by changing them in the lab so they can find and destroy cancer cells. CAR-T-cell therapy is also sometimes talked about as a type of cell-based gene therapy, because it involves altering the genes inside T cells to help them attack the cancer. As can be easily understood, this is individualized, taking nine to 14 days per patient.

In principle, this would lead to better efficacy and safety as the drug is personalized to suit the genetic and phenotypic characteristics of a patient. The downside is that being personalized, it cannot be mass produced. Therefore, it is very expensive, costing up to $1 million per patient (including the follow-up). And that is a big problem. For example, just treating 250,000 lupus patients in the U.S. would cost $25 billion. For only one disease.

To put that in perspective, let us appreciate that America spends approximately 20% of its gross domestic product on health care. A large part of that is the cost of drugs, especially biologics. That is more than twice the Organization for Economic Cooperation and Development average. The pushback against excessive health care spending has already started, and laws have been passed that restrict the price of drugs. In a couple years, Medicare will be able to negotiate the price of drugs. It will start with a few drugs and then expand. And where Medicare goes, so will other insurance companies. This will severely curtail the ability of pharma/biotech companies to continue charging a premium in the U.S. And if pharma/biotech companies cannot charge a high price for the personalized drugs, they will have little incentive to develop or market them.  And without commensurate payment, physicians will not be able to prescribe them.

The other problem with personalized medicine is the time it takes to make them. Unlike an assembly line, each “medicine” is made much like an expensive, custom-fitted Italian suit. Not more than 2,000 procedures can be done at present in the whole U.S. To accommodate all Americans, every single hospital bed will have to be converted the CAR-T therapy, which is impossible. Thus, from a logistical point of view, it is impractical to consider personalized medicine as a potential pathway.

With these considerations, health care authorities and decision makers should look at personalized medicine carefully and pragmatically, and not be wowed by the science. Ultimately, someone will have to foot the bill.

Do you think implementing personalized medicine is realistic? Share in the comments.

Dr. Desai is an entrepreneur and seasoned pharmaceutical industry executive, having been the CEO and founder of several biotechnology companies. Dr. Desai is also an active writer for investment websites ( and and is a published author (Germs of War). He has spoken at various medical and business conferences and was a medical advisor to ABC News on bioterrorism.

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