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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

#91

Post by ikeboy »

darklajid wrote: post #88
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.…

I'm confused. The article is about a drug that was sold at price X (13.5) that is now offered at price Y (750). Now, in my world every rational person has to see that this is insane. There's no way that the previous price was even remotely possible (even with a loss) that requires the new price. I don't see any data that supports your 'no one would be willing to make it for less' argument. The only reasons that doesn…

I don't see any data that supports your 'no one would be willing to make it for less' argument.

There are currently no other companies that are willing to make and sell the drug.

* The only reasons that doesn't seem to happen are either technical (the monopoly on the drugs manufacturing process) or legal (can't do that or you have to pay for .. creating cheaper drugs).*

The patent is expired, and saying "monopoly" is describing an outcome, not an input. Yes, it's a monopoly, because no other company is willing to go into that market right now.

Looking at the article in question, is 750 the 'right' price and no one's willing to create the drug for less?

I would deny that any price is "right". If you want to refer to "right", define it and give a way to calculate what price can be right.

As I said in the other comment, there's no good system to determine who should capture the value from a product that costs less to make than it's worth to purchasers, other than a free market.

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

#92

Post by ikeboy »

adwf wrote: post #40
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.…

Government setting prices works for the NHS in the UK. If a drug is too expensive it just doesn't get authorised as a treatment and we go with something else. The collective bargaining power of the nationalised system effectively forces the pharmaceutical companies to the table everytime. They'd rather sell for some profit than no profit. It's only because the pharma companies can deal with consumers in the US on an…

If the proposal is "set up a single payer system in the US", this may be relevant.

Do you know where I could find out whether the NHS is covering Daraprim at the new prices?

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

#93

Post by ikeboy »

gdrulia wrote: post #57
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.…

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 wo…

Should all trade secrets be outlawed, then? Or only in medicine?

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

#94

Post by ikeboy »

toomuchtodo wrote: post #55
ikeboy wrote: post #51

Earlier quoted context omitted.

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.

I still don't understand. Why do you need to set prices for private companies if you're competing with them yourself?

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

#95

Post by ikeboy »

ohazi wrote: post #49
ikeboy wrote: post #24

Earlier quoted context omitted.

What is that something else? In a monopoly situation, the price tends towards 100X in my example, which is still less than the value provided. Even in a monopoly, nobody's paying more for a product than they receive value from it. Yes, it may still seem unfair, but what else are you proposing? Nobody should sell the product? How is that making anyone better off?

"Something else" is removing the artificial constraints that created the monopoly in the first place.

What artificial constraints are those?

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

#96

Post by ikeboy »

username223 wrote: post #87
ikeboy wrote: post #17

Earlier quoted context omitted.

The question is, if it costs me X to make a product, and the value to you is 100X, who captures the 99X spread? I could charge 99X, you would pay it since the value is higher, and I'll capture most of it. I could charge 2X, it's still worth it to me to produce it, and you'll capture most of it. What value here is most fair? Why is one value fairer than another? The standard economic answer is "let the market decide",…

You're the guy who won't save the drowning child because your suit would get dirty, right? No, wait, you'd ask the kid if she would pay to have it dry-cleaned, then still refuse because you could probably get her to pay even more.

What does that have to do with anything?

Who is worse: the person who doesn't save the child, or the person who saves the child, and sends a bill later?

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

#97

Post by toomuchtodo »

ikeboy wrote: post #94
toomuchtodo wrote: post #55

Earlier quoted context omitted.

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.

I still don't understand. Why do you need to set prices for private companies if you're competing with them yourself?

Because the free market doesn't work when there's inelastic demand, or when supply chain disruptions cost people their life.

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

#98

Post by randyrand »

toomuchtodo wrote: post #79
randyrand wrote: post #70

Earlier quoted context omitted.

The only way to properly do this would then be to have the government become the only R&D and pharma company. Doable. But I think you put too much faith in the government. The government is a natural monopoly itself. If they're doing a shitty job you don't get any other options.

> Doable. But I think you put too much faith in the government. The government is a natural monopoly itself. If they're doing a shitty job you don't get any other options. Disagree. A government can be held accountable. Some asshole ex-hedge fund manager attempting to corner the market on a drug can't be.

> A government can be held accountable.

Accountability is not really the main measure we care about (though it's related to it). It's efficiency. We only really care about accountability because its supposed to increase efficiency. People are supposed to get punished when things are running poorly.

The problem is, no one really gets punished when large government organizations are running inefficiently. The business does not go out of business. There is no competition. There is no real incentive to innovate and beat your competitors.

I think we need to reevaluate pharma law. But I don't think replacing the current monopoly with a government one will do much good of anything.

I've long held the belief that whenever there is a supposed failing of private enterprise- it's almost always actually a failing of government. I've yet to be proved wrong. Government makes the barriers of entry too high in the drug market. It's way too easy to have a monopoly because the government basically grants you one.

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

#99

Post by dijit »

zo1 wrote: post #90
darklajid wrote: post #84

Earlier quoted context omitted.

Others were more civil in their reply to you. I just have to call your comment complete bullshit. I ignore the first two paragraphs which are devoid of content, but try to set you up as reasonable person. Then you bring up parenthood. And boy, you messed that up. I don't think you can fail any further. Not only are you trying to set up (your own!) rules to even _have_ a child, you are then ending in a - as far as I c…

>" And frankly, I'm so sad that you really think that way. In my world, society is meant to support people in need. " And in my world, I have chosen to bear the responsibilities of taking care of the ones I love. Because they are the most important individuals to me, and my morals necessitate that I do not impose my will on others by virtue of the state. >" Here's the thing: You cannot make sure that you can take car…

We're going a bit personal here, but, circumstances are everchanging.. when my mother decided to keep me, she had both parents, both grandparents and a network of friends.

All the family died (except my mothers father who did not wish to help) and her friends no longer associated with her because she wasn't available enough.

so, you can be wholly unprepared for raising a child and not even know it.

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

#100

Post by jonknee »

rayiner wrote: post #16
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…

How can what be true? The price of the old out of patent drug was too cheap and the target market too small for generic manufacturers to bother making it while it was widely available. Now that the prices have gone up they're having trouble getting samples to make a competing generic.

> Now that the prices have gone up they're having trouble getting samples to make a competing generic.

It's not hard to get samples because the pricing went up, but because they moved it to a direct sales model and actively prevent the drugs from getting in the hands of a generic maker. It seems absurd.

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