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US Pharmaceutical Pricing

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Re: US Pharmaceutical Pricing
Post by biochem   » Wed Sep 13, 2017 9:56 am

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Imaginos1892 wrote:Those 'generic drugs' are copies of 'brand-name' drugs that cost billions to develop. Without the original, expensive drug there wouldn't be any generics.
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That's how the patent system works for everything from drugs to football helmets. I don't have a problem with the basic concept although in the specific area of pharmaceuticals it could use some tweaking. The time in which the patent is in force includes the R&D period when the drug can't be sold. The problem with setting it up this way is that super novel drugs have a much longer R&D period (more bugs to work out when treading new ground). This gives companies less time to recoup their investment and discourages the development of super novel drugs. Perhaps instead of using patent law to protect drugs, there should be a period of market exclusivity instead i.e. Upon approval the new drug (including any modifications of the compound which would have been covered under patent law as being obvious to anyone skilled in the art) gets a 10 year period before generics can be manufactured.
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Re: US Pharmaceutical Pricing
Post by biochem   » Wed Sep 13, 2017 12:27 pm

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Joat42 wrote:
biochem wrote:Newsflash: they are not, all R&D is a gamble and if they can't get the economics of a product to work it's not the buyers responsibility to make it work, no matter how you "define profit". Although, in the end the cost will be transferred to the customers in one way or another.
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Lack of profit stopping rearsch is already happening that is why pharma is getting out of the antibiotic research business. In this case if the buyer doesn't make it work the buyer doesn't get new drugs.
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Re: US Pharmaceutical Pricing
Post by Joat42   » Wed Sep 13, 2017 5:42 pm

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biochem wrote:
Joat42 wrote:Newsflash: they are not, all R&D is a gamble and if they can't get the economics of a product to work it's not the buyers responsibility to make it work, no matter how you "define profit". Although, in the end the cost will be transferred to the customers in one way or another.


Lack of profit stopping rearsch is already happening that is why pharma is getting out of the antibiotic research business. In this case if the buyer doesn't make it work the buyer doesn't get new drugs.

And why is that research getting more and more expensive? It is the pharma companies own fault with their lax attitude and kick-back programs for MD's prescribing their antibiotics for any kind of sniffles.

When your profit is dependent on selling drugs you make sure they get sold, even if they aren't needed. And the companies have been fined repeatedly for this.

The pharmaceutical companies enjoys one of the highest profit margins in the world at ~20% and complaining about lack of profits is disingenuous.

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Re: US Pharmaceutical Pricing
Post by biochem   » Wed Sep 13, 2017 7:16 pm

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Joat42 wrote:
biochem wrote:And why is that research getting more and more expensive? It is the pharma companies own fault with their lax attitude and kick-back programs for MD's prescribing their antibiotics for any kind of sniffles.

When your profit is dependent on selling drugs you make sure they get sold, even if they aren't needed. And the companies have been fined repeatedly for this.

The pharmaceutical companies enjoys one of the highest profit margins in the world at ~20% and complaining about lack of profits is disingenuous.


MD prescribing programs have absolutely nothing to do with R&D costs.

A new drug in 1990 cost 0.5-1 billion in R&D and those drug were just as likely to be as safe and effective as drugs made today (not excludes biologics for which the safety improvements have been huge but those were a new area in 1990 so you'd expect that). Most of that cost differential is driven by consumer demands to the regulators. They keep demanding more and more expensive clinical trials but it doesn't really make much difference in safety/efficacy. What people don't see is by increasing R&D costs 4x per drug reduces the incentive for drug companies to invest in less profitable areas (antibiotics, drugs for the profoundly mentally ill etc)
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Re: US Pharmaceutical Pricing
Post by biochem   » Wed Sep 13, 2017 7:23 pm

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Daryl wrote:To some extent I'm conflicted here.
On one side companies are entitled to make a profit over time, and R&D is expensive.
On the other side when a company executive knows that setting the price of treatment at a millionaire's level will cause a great many people to die, I'm not sure how they sleep at night.

I'm also somewhat bigoted or biased by my experience in the workplace. Now retired, I was my country's representative in many contract and supply negotiations with the US Military/Industrial complex. My US equivalents were the most unethical and unscrupulous people that you could imagine. I won't give too many details, but a single example was a simple but essential aircraft component that was quoted at $800, we countered by having a copy made for about $5, their counter was "Sure, but it doesn't have an airworthyness certificate, so if you use it and a aircraft goes down we'll make sure that you all personally go down with it". We found the original supplier who agreed to provide it for $80 with the airworthyness certificate. The original company then offered to match that, we said go elsewhere and fornicate, and it just so happened as a totally unrelated result our next two fleets were sourced from Europe.
So, if a senior US executive tells me the sky is blue, I'll go out and check.


In pharma these guys are a necessary evil. We need the money they generate to fund the enormous R&D costs but most of the scientists hate their guts. And it's not just US executives. It's a global problem.

We have to leave in a very strong profit motive or we'll never get them to fund R&D but we can at least keep them from cheating using the tactics I cited in the original post. And the new one with the native tribes has broad implications outside of pharma. Anyone in any industry could now try a similar trick to get themselves partial immunity from patent challenges.
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Re: US Pharmaceutical Pricing
Post by Imaginos1892   » Sat Sep 16, 2017 10:20 am

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Companies spend money on R & D because they want to make more money. They know that not every research project will pay off, but they expect enough successes to make the effort worthwhile. If they don't have that expectation, they won't spend the money and we won't see new products.

Let us not forget that every new drug has to be PERFECT. If it fails to cure one patient, if one patient has an adverse reaction to it, you and your company will be sued to death by ten thousand shysters.

Every time I switch on the idiot box I am bombarded by ads from shysters promising millions to anybody who's ever had medical treatment go wrong, or just prove disappointing. They spend more on advertising than the Evil Pharmaceutical Companies!

There used to be laws against lawyers advertising on TV. Repealing them might have been a mistake.

How many new life-saving drugs have NOT been developed because of that miasma of pervasive fear?
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Re: US Pharmaceutical Pricing
Post by biochem   » Sat Sep 16, 2017 9:02 pm

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. How many new life-saving drugs have NOT been developed because of that miasma of pervasive fear?
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If you want to learn, the worst schools and teachers in the world won't stop you. If you don't want to learn, the best can't help you.


I've seen that one first hand . It's not the evil pharmaceutical companies killing a wonder drug story that is so popular in Hollywood rather what happens in real life is that some research directions simply are not pursued and if you don't look you can't find anything.
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