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2.5 – The Economics of Tolerization

If tolerization is as widespread, disruptive, and costly as it
appears, then a reasonable question follows

Why hasn’t the system done more to stop it?

The answer, as is often the case in medicine, lies in the
economics. Not in outright exploitation, but in a quieter,
more insidious truth: the system makes money even when
the drug stops working.

Biologic drugs are among the most expensive therapies on
the market. Annual costs routinely exceed $70,000 per
patient, with some surpassing $100,000. And unlike small
molecules, biologics don’t come in 30-day pills. They are
often infused or injected in specialty clinics, billed through
medical benefits, and reimbursed at rates that reflect not
just manufacturing costs but patent exclusivity, market
dominance, and negotiated pricing power.

And here’s the twist: most of that revenue is captured
early.

The pricing model for biologics is front-loaded. The first
year of therapy—when patient adherence is highest and
immune rejection hasn’t yet emerged—is when most of the
economic value is realized. If a patient flares after 12 to 18
months and needs to switch drugs, the system doesn’t lose
money. It bills again. Often for a new therapy, in the same
drug class, made by the same manufacturer.

This churn isn’t a financial crisis. It’s a revenue stream.

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