April 26, 2006
Cure For Cancer Worth $50 Trillion Just To Americans

The economic pay-off of medical research will be enormous when cures for cancer are developed. A couple of academic researchers claim that a cure for cancer would have an economic value of $50 trillion for Americans alone. Add in the value of the cure to other industrialized societies that the total value of the cure likely exceeds $100 trillion.

A new study, to be published in a forthcoming issue of the Journal of Political Economy, calculates the prospective gains that could be obtained from further progress against major diseases. Kevin M. Murphy and Robert H. Topel, two University of Chicago researchers, estimate that even modest advancements against major diseases would have a significant impact – a 1 percent reduction in mortality from cancer has a value to Americans of nearly $500 billion. A cure for cancer would be worth about $50 trillion.

"We distinguish two types of health improvements – those that extend life and those that raise the quality of life," explain the authors. "As the population grows, as incomes grow, and as the baby-boom generation approaches the primary ages of disease-related death, the social value of improvements in health will continue to rise."

Many critiques of rising medical expenditures focus on life-extending procedures for persons near death. By breaking down net gains by age and gender, Murphy and Topel show that the value of increased longevity far exceeds rising medical expenditures overall. Gains in life expectancy over the last century were worth about $1.2 million per person to the current population, with the largest gains at birth and young age.

"An analysis of the value of health improvements is a first step toward evaluating the social returns to medical research and health-augmenting innovations," write the authors. "Improvements in life expectancy raise willingness to pay for further health improvements by increasing the value of remaining life."

Murphy and Topel also chart individual values resulting from the permanent reduction in mortality in several major diseases – including heart disease, cancer, and diabetes. Overall, reductions in mortality from 1970 to 2000 had an economic value to the U.S. population of $3.2 trillion per year.

In 2005 the US economy produced $12.4 trillon worth of goods and services. So the value of a cancer cure equals over 4 years of US economic output.

The enormous economic value of curative treatments for cancer and similar magnitude economic value for cures for other major killers such as stroke and heart disease mean we can get huge the future returns on investment in public spending for basic biomedical research. This means increased biomedical research funding by governments is pretty easy to justify when viewed in economic terms. Yet in order to fund a war, pork, and other wastes the Bush Administration has sought to cut biomedical research spending in inflation-adjusted terms and even proposed a freeze in nominal dollar terms (which means that real research spending goes down by the rate at which inflation goes up).

The numbers bandied about above understate the coming return on decades of basic biomedical research. Rejuvenation therapies will lengthen working careers and brain rejuvenation will boost productivity for most years worked. Minds which have both youthful vigor and the knowledge and skills accumulated from decades of work will achieve much greater feats and operate at much higher levels of productivity.

Because the rate of advance of research can not be forecasted accurately I think there's a tendency on the part of policy makers and the public to underestimate the future return on biomedical research and in other forms of research as well. Our accumulating body of knowledge is going to reach a critical mass at some point in the next 50 years where the vast majority of diseases become curable and replacement or rejuvenation of worn aged body parts becomes commonplace. We ought try much harder to make that day come sooner.

Share |      Randall Parker, 2006 April 26 10:11 PM  Policy Medical


Comments
James Bowery said at April 26, 2006 11:45 PM:

A couple of weeks ago I bought Paul Ewald's book ($5 hard back at Powell's) as part of my effort to understand the evolution of virulence better. It's "Plague Time: How Stealth Infections Cause Cancers, Heart Disease and Other Deadly Ailments". I just ran across this passage:

"Few new examples of infectious causation [of chronic disease JAB] were accepted from about 1950 to 1980. One of the reasons for this slowdown was the equating of acute diseases with infectious diseases. This error was explicitly incorporated into the policy and goals of this period. In 1967, when the U.S. surgeon general William H. Stewart made his infamous statement about closing the book on infectious disease, he was actually advocating a shift of attention from infectious diseases to chronic diseases. Of course, if chronic diseases are caused by infection, the proposed shift away from infectious diseases makes no sense. Funding was switched to chronic diseases under the hidden assumption that viable hypotheses for causation of chronic diseases exclude hypotheses suggesting infection. The progress made on preventing diseases slowed almost to a standstill--in spite of vastly greater financial investment. The U.S. National Institutes of Health, for example, spent twice the amount of inflation-adjusted dollars on research in 1990 that it spent in 1970, and will spend about twice as much in 2000 as it spent in 1990.

Nixon's War on Cancer during the early 1970s was an exception to the rule that funding of chronic diseases has neglected infectious causation. The War on Cancer was roundly criticized during the late 1970s and 1980s, and by many in the 1990s, as a failure that occurred because medical science knew too little about the basic biology of cancer to make good use of the money. Now, with a quarter century of hindsight, we can see that this criticism was at least partly false. Those few years of generous funding allowed research dollars to flow even to those who were investigating infectious causes of cancer.

David Govett said at April 27, 2006 11:03 AM:

Not that I object, but it's a simple fact that keeping all the cured people alive for decades more probably would cost more in social security payments than it would save.

Michael Anissimov said at April 27, 2006 5:58 PM:

If $50 trillion is the value of a cure for cancer, just think of the value of a cure for aging.

K said at April 27, 2006 6:01 PM:

Like David I don't object either. But numbers on this scale are simply meaningless. e.g. if cancer disappeared tomorrow how much longer would the average person live? maybe three years. so how does keeping the less than 2 percent who die each year alive 3 for more years save that much money?

I'll return this to this when I can examine the study more. Right now the grandkids want the machine.

Michael Anissimov said at April 27, 2006 6:07 PM:

If a cure for cancer is worth $50 trillion, just imagine the value of a cure for aging.

jill said at April 27, 2006 7:32 PM:

Randall, maybe Bush is on to something ... given the huge value we should have no shortage of private funds chasing a cure ...

remo williams said at April 27, 2006 7:59 PM:

Obviously social security will be revamped as it already has been a few times since being introduced. Another thing to keep in mind is what Randall wrote about other rejuvination which would make the world more productive (as well as more enjoyable). I think we will see the end of both cancer and heart disease by 2015. It could happen a bit earlier... Think of the scientists now freed up to tackle other problems.

Randall Parker said at April 27, 2006 8:09 PM:

Jill,

But we do not have an amount of private money chasing the cure that is commensurate with the eventual value of a cure. There are a few reasons for that. Most notably, a cure requires accumulation of a huge amount of non-ownable and non-patentable knowledge about how cells regulate growth. The market does not provide much incentive for accumulation of basic scientific knowledge.

K,

Some of the people who get cancer are of working age. I knew a computer programmer who died of brain cancer in his 30s for example. Their loss of production has value. Also, some who get cancer get a alot spent on their treatment that does not do much and which decreases or totally stops their productivity for a while even if they eventually recover.

We'd benefit from better treatments for those who get life extension from current treatments since newer treatments will eventually cause very little disruption. Take a pill and perhaps feel lousy for a couple of days. Then feel perfectly normal and need no further follow-up tests. That's what a great cancer treatment would be like.

Dave Govett,

As Lewis Thomas MD pointed out in of his his Lives Of Cell books, lousy treatments that work poorly are really expensive. Cures are usually very cheap. We might save more in medical care costs than we'd pay in tax-subsidized pension costs. Surely that will be the case with rejuvenation treatments which will even eliminate the need for the pensions entirely.

Doug said at April 27, 2006 10:07 PM:
"It's a simple fact that keeping all the cured people alive for decades more probably would cost more in social security payments than it would save."

It's a simple fact that being forced to support people through years of idleness makes us resent them and secretly wish them dead.

AA2 said at April 27, 2006 10:31 PM:

There is big money going after ways to reduce mortality from cancer. I have two poinst to say..

First I think rejuvinating people will help limit cancer mortality. Young people with healthy immune systems rarely get cancer. Whereas old people with failing immune systems often get cancer. As do young adult aids patients when their immune system breaks down they often get cancer.

Secondly my guess is we will see a nanotechnology based cure. Like those nanoshells designed to connect with the dendrites specific to the type of cancer cells.. Then to heat up when exposed to ultraviolet and kill the cells.

Steve N. said at April 28, 2006 4:58 AM:

Randall:

Did you catch this impressive development. We may see a cure quicker than most imagine. This discovery has the smell of a Nobel.

LOX holds a key to curbing cancer's spread

NewScientist.com news service
Prashant Nair


A key molecule which is crucial for the spread of cancer has been identified by US scientists. Blocking the protein stopped the spread of tumours in mice, and the researchers hope it may offer a valuable target for cancer therapies in humans.

The spread of cancer cells, or "metastasis", is a major problem and the principal cause of mortality among cancer patients. Now researchers at Stanford University School of Medicine, California, US, headed by Amato Giaccia have discovered the enzyme that mediates metastasis.

The potentially rampant spread of cancer through the body depends on a number of factors. But low oxygen conditions are typically associated with the human cancer cells capable of spreading. The researchers uncovered the enzyme responsible for the spread of oxygen-starved cancer cells in human breast, head and neck cancers.

Dubbed LOX (lysyl oxidase), the enzyme is produced in cancer cells under low oxygen conditions. The team found that human breast cancer cells lacking oxygen produced more LOX. They also found that patients whose tumour cells made high amounts of LOX were more likely to suffer metastasis and had a lower chance of survival.

Lungs and liver
The team grew human breast cancer cells on artificial gels created to mimic the natural environment in which these cells move in the body. Normal cancer cells showed a branched appearance, typical of spreading cells. But cancer cells in which the production of LOX was blocked using an inhibitor, failed to spread on the gels. They remained in spherical clusters showing little branching and were completely immobile.

“LOX is implicated in the invasiveness of tumours”, says Giaccia. But it also does another thing. As well as causing cells to spread, he believes LOX also creates a “permissive niche” or environment which also boosts the cells’ growth so they multiply.

To test the therapeutic potential of LOX, the team engineered human breast cancer cells to produce less LOX than normal cancer cells. They then implanted these cells in the form of tumours into mice.

Hot target
In mice that received the normal tumours, the cancer cells spread to the lungs and liver. But those that received the tinkered tumours producing less LOX had fewer cancer cells in the lungs and none in the liver. Furthermore, when a chemical inhibitor of LOX was given to mice harbouring the normal tumours, metastasis was completely blocked. The team achieved the same effect using an antibody that blocked the function of LOX.

“The findings are highly interesting since they create an entirely new set of insights into the mechanisms of invasion and spread of cancer,” says Robert Weinberg, a cancer biologist at the Whitehead Institute for Biomedical Research, Massachusetts, US.

Although blocking LOX can block the spread of cancer, it does nothing to the primary tumour itself, cautions Giaccia. “But since LOX is involved in the early and late stages of the spread, it is a hot therapeutic target,” he adds. The team is now developing human-compatible antibodies to block LOX.

Journal reference: Nature (DOI: 10.1038/nature04695)

K said at April 28, 2006 12:42 PM:

Randall. I was speaking of averages. Most who die of cancer are past their working years. The 3 years was my guess as to overall extension - it might be 5 or 10, I don't know. And it doesn't matter. What matters is that money is well used to cure what we can.

To me it would be sensible to look backwards. If cancer had been cured by Nixon's program in, say, 1974, what would we have saved? I often hear 14% of GNP goes to health care, about 1.5 trillion $. Certainly not all of that is for cancer treatment.

So how can a figure of $50 trillion be extracted without mirrors? Or the $3.2 trillion yearly amount? If it doesn't come from actual money spent on cancer related expenses then it must be constructed by 'what if'. And even a quick glance shows that around 90% of that $3.2 yearly trillion was so constructed.

You yourself said the figures were 'bandied about'. You then conclude they must be low. I suspect they use 1970 dollars when that suits the agenda, 2005 dollars when that suits, readily adjust life expectancy gains, and even fiddle with the future as needed to pronounce that about 25% of todays entire economic output comes from health improvements since 1970.

The study, when published, should be interesting. You do a great job keeping these topics visible. I hope that you will have a follow up when the methods used are known.

Meanwhile I am not surprised that the publication has the word 'Political' in the title.

Randall Parker said at April 28, 2006 4:34 PM:

K,

The economic value of a cancer cure is partly dependent on the average age of the people who get cancer. But it is also dependent on the standard deviation of the age of onset and age of death. If (and I'm making up numbers to illustrate a point) average age of onset is 65 with a standard deviation of 1 year then the economic value of a cancer cure is much lower if the average age of onset is still 65 but with a standard deviation of 10 years. In the latter case a much larger fraction of the cancer sufferers would be still of working age when they get it. Hence a loss of income and of production and development of new technology and scientific knowledge by those who die.

Nobelist Richard Smalley just died of prostate cancer. What would additional years of his life bave been worth to the rest of us? Feynman died of throat cancer. Same question,

Dollars saved in medical care are not the only measure of a cure for cancer. Advances create new sources of value, new things worth paying for. A cure for cancer adds years to life. That must be worth something to each person. What is the value of a life saved? It is quite high when regualtions are proposed for aircraft safety. If cancer sufferers could buy more years how much would they pay? How much would their loved ones pay to keep them around longer?

To put it another way: If you knew that 20 years from now you'd get cancer and it could kill you unless you could afford some future expensive cure then how much harder would you work for the next 20 years to earn money to pay for a cure?

My phrase with "bandied about" in it: Note that I was talking about the value of biomedical research more broadly. Biomedical research certainly is going to create hundreds of trillions of dollars worth of value.

K said at April 29, 2006 3:06 PM:

Good reply Randall. But it has little to do with my comments. We can't assume anything from the fact that some productive people die relatively young. We can only believe they might have done something of great merit later. That is entirely what I said - it looks as if the $ cited are 90% 'what if'.

The topic is a 'gee whiz' press anouncement of $50 trillion and $3.2 trillion per year. That seems to not jive with the size of our economy. So what is being published? Is it in 2030 $.

Does it assume the cure, once found, will be so inexpensive that all can have it? What if the cure is something like interferon which remains hideously expensive after 30 years?* Or, perhaps the numbers assume that income vanishes when a person dies. e.g. Warren Buffett dies so his $3 billion income is no more. Not true, his income just goes somewhere else.

So I don't see any real information yet. If these guys are saying that curing cancer will make us feel $3 trillion better and raise our income $.2 trillion then let them say that a little more clearly. There are strong hints this is the case when they use phrases like 'quality of life' and 'social returns' and 'social value'. To me that says they intend to mix real numbers and imagined ones as needed. I hope the actual methods allow us to see which are which.

p.s. I don't track the cost of interferon, maybe it has come down. Some costs do, some don't. I know it was costly in $2000 when my nephew needed it.

Randall Parker said at April 29, 2006 4:10 PM:

K,

I'm afraid I did respond to your comment and you ignored my main point.

Suppose a cost is avoided. Depending on how it is avoided the economy may look no larger. Measurements of the size of the economy do not capture many improvements in quality of goods.

Curing cancer will allow more people to be more productive and so the economy will be larger. Plus, it will allow many people now working to treat cancer to do other things. People will spend less on medical insurance and medical expenses. Their income may not change. The total they spend may not change. But they will be able to buy things they can't buy now because now they have to spend on medical care.

Buffett: When he dies Berkshire Hathaway will not be run as well. The productivity of other people will be lower than it would have been had he stayed around longer.

K said at May 1, 2006 1:27 PM:

Randall. I sense that you and I will always differ. I have no doubt that curing cancer will be good and improve life in many ways. But here we have people saying it is $50 trillion, or $3.2 trillion a year, or whatever they are saying. I see no real way to decide what they are saying.

Quality of goods is just dandy. People might be quite happy buying TVs instead of chemotherapy. But if, as you say, their income may not change then how do you get $50 trillion? It just seems to me that romantic people want big # when it supports their agenda but when questioned they say 'oh, it will really be in the payoffs and satisfactions from doing other things with our limited resources.'

As for Buffett. There is no reason to believe his successors will not run things just as well. But even if you reject that premise I doubt you will say that we can measure in advance the change in our economy. Will Americans be $10 billion poorer when he has been dead a year from cancer? Or $50 billion?

Yet this is very similar to what the article says it measures. I say 'show me!'

moris said at January 23, 2007 2:15 AM:

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SHANTI SINGH said at June 3, 2009 2:56 PM:

i think that many stanford scientists like me are more likely to find the cure for cancer, create our own company, and become the yougest (25) SCIENTIST TO BECOME A TRILLIONAIRE>>!!!!!!!!!:)

Cancerkiller said at October 18, 2013 12:20 PM:

(Maybe I become the trillionaire) - In any case I already got the cure for cancer - my discovery - the PCK - The T-Rex Personal Cancer Killer - the complete prevention and cure (for those now sick) for kids and adults of any diseases - from the common cold to cancer - just an exercise for a minute a day for prevention and for 3 - 4 minutes a day for the cure - in the comfort of your home - away from any vaccines, drugs, doctors, hospitals, clinics, surgeries (avoiding any slicings in our bodies), radiation and chemotherapies, etc. Nature has provided us the enormous power of being as healthy as Gods, we just gotta activate it. Cancer Killer is by far more powerful than the immune system itself, keeps it intact, while vaccines devastate it by adverse side effects. No killer viruses, bacteria, germs and cancers on Earth got any chance against the tremendous power of the Cancer Killer - they just die the moment they touch you.

The price of the T-Rex Personal Cancer Killer for the whole world is 2,25 Trillion US Dollars (much less than the 50 Trillion Dollars, estimated by economists from the University of Chicago for the discovery of cancer cure). I accept checks of $50 Million to describe or to show the Cancer Killer personally and how one can stay absolutely healthy all the time, all life long (like a living God - just like me).

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