What is a quality-adjusted life year? It's a metric that has already shamed a number of prominent drug-makers into dramatically lowering the cost of their medications.

One quality-adjusted life year (QALY) represents one year of perfect health. Thus, a person's QALY expectancy is calculated based on the amount of life they have left and the expected condition they will be in during that time.

Why is this relevant to medicine? Because the goal of medication should either be to prolong life or to improve its quality.

The concept has been debated by academics since the 1960's and is most prominently championed by the Institute for Clinical and Economic Review, a research group affiliated with Harvard Medical School.

In recent years, ICER has been publishing what it considers a fair price for drugs based on the number of QALYs they can provide a patient.

While no regulatory agencies have adopted the metric in any official capacity, some insurers are embracing it in negotiations with pharmaceutical companies over drug prices. And in an interesting twist, some pharma companies have said they will take it into account, perhaps in hopes of fending off criticism at a time when patients and politicians are eager to crack down on drug price increases.

"Whatever pricing we believe will be appropriate for a product will be compared to what ICER did," Dave Lennon, president of the Novartis unit responsible for Zolgensma, explained in an interview with the Wall Street Journal.

After initial expectations that Zolgensma would cost as much as $5 million, Novartis agreed to sell it for about $2.1 million. Similarly, the company surprised the drug world when it offered to sell its new migraine drug, Aimovig, for only $6,900, down from the $8-10,000 that industry analysts had projected.

Sanofi SA and Regeneron Pharmaceuticals also agreed to drop the list price of their cholesterol drug, Praluent, from $14,500 to about $5,800.

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An old idea to lower drug prices sees new life

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