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A Huge Overnight Increase in a Drug’s Price Raises Protests

nytimes.com

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Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#51

Post by ikeboy »

toomuchtodo wrote: post #33
ikeboy wrote: post #18

Earlier quoted context omitted.

The question is how we can fix this systematically without making bigger problems. Should a government agency set prices? What if the company stops making the drug, then? The price is high because no other companies are willing to make it for lower, after all. Note that the drug in question is not under patent. I don't think you'd advocate for literally forcing the company to make it and sell it for a specific price.…

> Should a government agency set prices? Yes. > What if the company stops making the drug, then? A non-profit government sponsored entity manufactures the drug at cost.

Why not skip step 1, then? Let the company sell it for however much it wants, and the non profit competes them out of business?

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#52

Post by [deleted] »

tuna-piano wrote: post #43

The thing that I think many people are ignoring is the positive effect that high drug prices (& profits) leads to in the economy. Economic resources such as entrepeneurs, capital, equipment and scientists follow the money. If there's money to be made on Wall street, resources go there. If there's money to be made in mobile apps, resources go there. As mentioned elsewhere in this thread, the price being so high now sh…

[deleted]

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#53

Post by zo1 »

oconnor663 wrote: post #39
cjlars wrote: post #21

Earlier quoted context omitted.

>“This is still one of the smallest pharmaceutical products in the world” What Turing is doing is exploiting the natural monopoly that has formed for this drug. I was able to find only two global producers of this drug after a quick search (Turing and a generic Alibaba listing), which if true means Turing is the only game in town for a lot of supply channels. In addition, the medical market is relatively unable to ad…

This monopoly doesn't sound very natural.

Nor does the phrase "natural monopoly". If I didn't know better, I'd say it was a phrase that was post-created in order to be a "valid" argument against a free-markets ability to self-correct without the presence of a state.

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#54

Post by bhickey »

richdougherty wrote: post #41
cjlars wrote: post #21

Earlier quoted context omitted.

>“This is still one of the smallest pharmaceutical products in the world” What Turing is doing is exploiting the natural monopoly that has formed for this drug. I was able to find only two global producers of this drug after a quick search (Turing and a generic Alibaba listing), which if true means Turing is the only game in town for a lot of supply channels. In addition, the medical market is relatively unable to ad…

Another way to restrict competition is to stop competitors getting samples of your drug. Without samples of the original, it's impossible to prove a generic is equivalent. Here's an example where patient safety rules were used to stop competitors getting samples: http://marginalrevolution.com/marginalrevolution/2014/09/co-...

> Without samples of the original, it's impossible to prove a generic is equivalent.

I know we're in FDA-land where logic doesn't rule, but this beggars belief. This is similar to the nonsense by which HFA inhalers knocking generic CFC inhalers off the market.

Any competent organic chemist can tell you if you've got pyrimethamine or not. This isn't some exotic chemical. There's published spectra (http://webbook.nist.gov/cgi/cbook.cgi?ID=C58140&Mask=80). Having a competitor's drug will simply tell you anything new. If it does, they've behaving deceptively.

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#55

Post by toomuchtodo »

ikeboy wrote: post #51
toomuchtodo wrote: post #33

Earlier quoted context omitted.

> Should a government agency set prices? Yes. > What if the company stops making the drug, then? A non-profit government sponsored entity manufactures the drug at cost.

Why not skip step 1, then? Let the company sell it for however much it wants, and the non profit competes them out of business?

Supply chain stability. Availability is sometimes more important than cost, and if you have a government non-profit producing the drug, you're not wasting any money on the profit that a private company is extracting.

Drugs should be priced based on their cost to produce and whatever R&D needs to be amortized, not by how much value you can extract.

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#56

Post by mirimir »

ithought wrote: post #11
jonknee wrote: post #3

My first thought was generics since it's so old, but this is simply amazing: > With the price now high, other companies could conceivably make generic copies, since patents have long expired. One factor that could discourage that option is that Daraprim’s distribution is now tightly controlled, making it harder for generic companies to get the samples they need for the required testing. > The switch from drugstores t…

If I remember correctly, when Provigil became generic, they bought the company producing the generic form. They also slightly changed the drug and patented a new form as Nuvigil. Last year, I asked my physician's assistant (I have never actually met my personal doctor) for a prescription and he told me that he didn't believe Provigil/Modafinil was even made anymore and tried almost emphatically to get me to take Nuvi…

Yes, but ...

> The Federal Trade Commission has reached a settlement resolving the Commission’s antitrust suit charging Cephalon, Inc. with illegally blocking generic competition to its blockbuster sleep-disorder drug Provigil. The settlement ensures that Teva Pharmaceutical Industries, Ltd., which acquired Cephalon in 2012, will make a total of $1.2 billion available to compensate purchasers, including drug wholesalers, pharmacies, and insurers, who overpaid because of Cephalon’s illegal conduct.

https://www.ftc.gov/news-events/press-releases/2015/05/ftc-s...

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#57

Post by gdrulia »

ikeboy wrote: post #18
gdrulia wrote: post #14

Earlier quoted context omitted.

What you're saying makes perfect sense on paper, but unfortunately reality is as always slightly more complex. Such simple thinking is full of the holes for exploitation and there will always be someone who will exploit them. Medicine is especially sensitive, because medicine can be priceless in value for the human who needs it, but that same human might not be able to pay that much. You can introduce government help…

The question is how we can fix this systematically without making bigger problems. Should a government agency set prices? What if the company stops making the drug, then? The price is high because no other companies are willing to make it for lower, after all. Note that the drug in question is not under patent. I don't think you'd advocate for literally forcing the company to make it and sell it for a specific price.…

First I will say that I'm not an expert in these questions, so my thoughts might be off, but that's probably the reason we are discussing it.

The closest to perfect solution in my mind would include all the details to make the medicine in the patent itself (I'm not sure how detailed patents has to be today). This would make it easy for other companies to create a competition once the patent expires and essentially would create a free market.

In the scenarios when it happens that there is only a single player in the market for one or another reason, things get a little trickier. I guess one of the solutions could be a commitment by government to buy/prescribe certain amount of medicine. The price of a unit should be predetermined in such cases to avoid exploitation.

Overall the actual knowledge of how to make a medicine and having a market for it, should make such situation pretty rare when only a single player is left in the market.

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#58

Post by kbenson »

tuna-piano wrote: post #43

The thing that I think many people are ignoring is the positive effect that high drug prices (& profits) leads to in the economy. Economic resources such as entrepeneurs, capital, equipment and scientists follow the money. If there's money to be made on Wall street, resources go there. If there's money to be made in mobile apps, resources go there. As mentioned elsewhere in this thread, the price being so high now sh…

The thing that I think you may be ignoring is the negative effect that high drug prices (and lack of affordability) has on the economy.

Health insurance, mandated as it is now in the US, is really a secondary tax we all pay to ensure people get a minimum level of care in the case of required medical care. Increased costs in medical treatment affect everyone that has health insurance to a small degree.

This being a "life-threatening parasitic infection" means that normal rules of supply and demand don't quite fit (as well as the fact that health insurance already makes this an inefficient market). There isn't always a price at which people will be unwilling to pay, beyond their inability to pay.

More profits for companies that develop drugs are only good in their eventual outcome, which is new drugs that are either better or cheaper than the existing ones. Manipulating a market to keep prices high on a drug may result in a development of a new drug which is either better or cheaper, but we have to keep in the ind the actual effects on the market right now, which is a more expensive and less available drug.

It would be a shame if we allowed a company to manipulate a market in the hopes that the extra money led to a positive outcome and that resulted in real deaths and pain in the meantime. I would tend to think that if they need to manipulate the market in that way to get the money they need for research, perhaps their past research efforts have not been as beneficial as some other companies, and that money would be better going to the companies that provide real benefit.

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#59

Post by ikeboy »

pixl97 wrote: post #35
ikeboy wrote: post #18

Earlier quoted context omitted.

The question is how we can fix this systematically without making bigger problems. Should a government agency set prices? What if the company stops making the drug, then? The price is high because no other companies are willing to make it for lower, after all. Note that the drug in question is not under patent. I don't think you'd advocate for literally forcing the company to make it and sell it for a specific price.…

>What if the company stops making the drug, then? The price is high because no other companies are willing to make it for lower, after all. Nope, don't force the company to make it. Force the company to give the formulation to another company that will. This article states the reason it is able to be priced so high, at least for a time, is that other companies will have to reverse engineer it and get a line running.…

The composition is public, and needs to be disclosed when patented. In order to get FDA approval for a generic drug, you need to show that it performs as well as the actual drug (not really, but that's a different issue [0]). In order to do that, you need to have samples of the actual drug.

[0] http://fortune.com/2013/01/10/are-generics-really-the-same-a...

Re: A Huge Overnight Increase in a Drug’s Price Raises Protests

#60

Post by asdfologist »

tuna-piano wrote: post #43

The thing that I think many people are ignoring is the positive effect that high drug prices (& profits) leads to in the economy. Economic resources such as entrepeneurs, capital, equipment and scientists follow the money. If there's money to be made on Wall street, resources go there. If there's money to be made in mobile apps, resources go there. As mentioned elsewhere in this thread, the price being so high now sh…

The parent's getting downvoted to oblivion, but I dare say the argument makes sense. In the long run, more lives will be saved if there's a greater economic incentive for entrepreneurs to make new and better drugs.

Or to put it another way - the government can instantly save many lives in the short run by forcing all drug companies and hospitals to make all their products and services $1 each, but this would have disastrous consequences in the long run, as every single one of those companies would quickly exit the market.

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