Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why drug prices in America are so high (2016)

economist.com

Post reply on HN
Print view View original

191–200 of 204 posts

Re: Why drug prices in America are so high (2016)

#191

Post by chimeracoder »

Thimothy wrote: post #190
chimeracoder wrote: post #149

Earlier quoted context omitted.

> Academia should be the primary means of drug discovery. Drug manufacturing and distribution _should_ be a commodity business As mentioned below, the discovery is not the biggest driver of costs. But you should also ask yourself: why is this not already the case? Currently, there's nothing stopping other countries from using taxpayer money to fund drug development locally. Except, by and large, they don't - as menti…

"Currently, there's nothing stopping other countries from using taxpayer money to fund drug development locally. Except, by and large, they don't - as mentioned in the article" Come on!! Hasn't anybody actually read the article?? Unless the economist is showing different articles to different people the only phrase that mentions research implies that is an argument made by the industry and not clear at all. The "the…

> The "the US subsidizes drug research for the rest of the world" is a huge lie that cannot die soon enough.

It's a trivially verifiable fact. If you don't like the Economist, here's another source, showing that the US used to fund over 50% of the entire world's medical research. That number has dropped to 44% in the last decade, but only because China and India are growing so fast.

http://www.npr.org/sections/health-shots/2015/01/13/37680135...

Re: Why drug prices in America are so high (2016)

#192

Post by dv_dt »

refurb wrote: post #183
dv_dt wrote: post #173

Earlier quoted context omitted.

> Pricing in the US is not cost-based I think this speaks for the whole issue ... there are some markets where this makes sense. I don't believe that it makes any sense in the healthcare market - and per-capita US healthcosts vs other nations would seem to bear that out.

Pricing isn't cost based in any developed country. It's value based. The only market that is cost based are generics.

So whatever value can be extracted by holding lives of patients hostage?

Re: Why drug prices in America are so high (2016)

#193

Post by toomuchtodo »

_Wintermute wrote: post #188
toomuchtodo wrote: post #41

Earlier quoted context omitted.

Has the US ever fought hard to institute a travel ban in order to prevent people of a certain religion from entering the country, despite judicial intervention. That's the thing about governments: they can do whatever they want. And your recourse is to deal with it or spend years fighting against it (or die in the streets fighting it, lest we forget that option). Disclaimer: I'm for breaking patents when necessary, a…

You're comparing printing simple metal structures from metal powder to synthesizing complex molecules from scratch? I think you might want to brush up on your chemistry before pinning your hopes on 3D printed drugs.

Why it matters that the FDA just approved the first 3D-printed drug (2015)

https://www.washingtonpost.com/news/innovations/wp/2015/08/1...

3D printing of tablets containing multiple drugs with defined release profiles (2015)

http://www.sciencedirect.com/science/article/pii/S0378517315...

I can Google. You should Google before making a false blanket statement.

Re: Why drug prices in America are so high (2016)

#194

Post by rlpb »

allenz wrote: post #171
calvinbhai wrote: post #91

Drug prices in US go up because of collusion between Insurance Companies and Drug manufacturers. Would I buy expensive health insurance if drugs cost me $100 a month? Most probably never. What if the sticker price for my monthly dose of drugs was $10,000 or $50,000? You bet I'd go get an insurance that'd cost $500 a month. With such sticker shock, manufacturer reaps in profits. Insurance companies get to charge highe…

> Drug prices in US go up because of collusion between Insurance Companies and Drug manufacturers. It's great that you're interested in healthcare policy, but you should be careful about making blanket statements without the evidence. Drugs are 9% of healthcare costs[1] and 14% of insurance costs[2]--hardly the decisive factor in your choice of health insurance. And expensive drugs are expensive primarily because it…

> And expensive drugs are expensive primarily because it really does cost $1B+ to develop a new drug.

Nope. More of the cost of a drug goes to marketing than development: https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...

Re: Why drug prices in America are so high (2016)

#195

Post by breatheoften »

chimeracoder wrote: post #191
Thimothy wrote: post #190

Earlier quoted context omitted.

"Currently, there's nothing stopping other countries from using taxpayer money to fund drug development locally. Except, by and large, they don't - as mentioned in the article" Come on!! Hasn't anybody actually read the article?? Unless the economist is showing different articles to different people the only phrase that mentions research implies that is an argument made by the industry and not clear at all. The "the…

> The "the US subsidizes drug research for the rest of the world" is a huge lie that cannot die soon enough. It's a trivially verifiable fact. If you don't like the Economist, here's another source, showing that the US used to fund over 50% of the entire world's medical research. That number has dropped to 44% in the last decade, but only because China and India are growing so fast. http://www.npr.org/sections/health…

Given the lack of transparency in the billing process for health care services -- there is no part of me that thinks these numbers could provide an accurate representation of expenditures toward actual research. How much research investment actually gets funneled into direct payments towards insurance companies or hospital providers (possibly co-owned by the research funds). The space for financial gamesmanship in the way medical facilities operate in the us is so big that I there's no possibility that this kind of thing is not occurring on a large scale ... if us public/private investment into medical research is so healthy -- why have the job prospects for anyone with a biomedical degree been declining for a decade straight?

Re: Why drug prices in America are so high (2016)

#196

Post by calvinbhai »

allenz wrote: post #171
calvinbhai wrote: post #91

Drug prices in US go up because of collusion between Insurance Companies and Drug manufacturers. Would I buy expensive health insurance if drugs cost me $100 a month? Most probably never. What if the sticker price for my monthly dose of drugs was $10,000 or $50,000? You bet I'd go get an insurance that'd cost $500 a month. With such sticker shock, manufacturer reaps in profits. Insurance companies get to charge highe…

> Drug prices in US go up because of collusion between Insurance Companies and Drug manufacturers. It's great that you're interested in healthcare policy, but you should be careful about making blanket statements without the evidence. Drugs are 9% of healthcare costs[1] and 14% of insurance costs[2]--hardly the decisive factor in your choice of health insurance. And expensive drugs are expensive primarily because it…

I agree its not a major %age of the costs for Insurance company. But here's what I think is happening:

Manufacturer MFG could sell a drug X at $1 and sell directly to 10,000 people at $1, make $10,000 revenue

But because of perverse insurance incentives, MFG decides to sell the same drug at $100, and there are 100 out of those 10,000 who can afford an insurance plan that covers the cost for that $100 drug X.

So, by jacking up the price the drug company's revenue at the very least, remains intact, or in most cases can get more revenue if the number of rich people with expensive insurance plans is greater than 100.

While Insurance companies wont mind paying the $100 since that fear of expensive drug gives them more customers affected by FUD, willing to pay obscene premiums, copays and deductibles.

And since many health insurance premiums are subsidized by the employer, the employee doesn't realize the true cost of health insurance, and thinks its a great deal to get a $100 drug for $20.

The solution I proposed, will solve this pricing obfuscation to a great extent. Insurance companies cannot justify paying for an expensive drug, if a cheaper one is available. MFG can still price drug X at $100, but if there's a generic variant made in India / Africa / China available for $5, there wont be a market for MFG to sustain. So, there's an incentive for MFG to sell X at I dont see people on either side of the political spectrum in US, asking to fix this problem. Nor has there been much discussion about the same. Hope this concept is evaluated and becomes popular in solving the Healthcare Mess of America.

Re: Why drug prices in America are so high (2016)

#197

Post by refurb »

dv_dt wrote: post #192
refurb wrote: post #183

Earlier quoted context omitted.

Pricing isn't cost based in any developed country. It's value based. The only market that is cost based are generics.

So whatever value can be extracted by holding lives of patients hostage?

No the value offered to the healthcare system. If a disease is costing a public/private payer $100K per year, if I price my drug at $30K per year and eliminates all other costs, I'm saving everyone $70K per year. That is offering real value and should be paid for.

Re: Why drug prices in America are so high (2016)

#198

Post by dv_dt »

refurb wrote: post #197
dv_dt wrote: post #192

Earlier quoted context omitted.

So whatever value can be extracted by holding lives of patients hostage?

No the value offered to the healthcare system. If a disease is costing a public/private payer $100K per year, if I price my drug at $30K per year and eliminates all other costs, I'm saving everyone $70K per year. That is offering real value and should be paid for.

So if I offer a drug that saves someones life, is the value the rest of their life, plus whatever society derives from that person too? Do I get to set a price that is 98% of that? I suppose they need something to live on so 80%? But then you see charities and and families holding out the tin cup so sick relatives can get their chemo treatment - so there's a path to extract some of the 'social' value of that person too...

Blithe statements of pricing at "value" are not the simple open and shut cases they are made out to be - and IMHO for healthcare are corrosive to our society and economy.

Re: Why drug prices in America are so high (2016)

#199

Post by refurb »

dv_dt wrote: post #198
refurb wrote: post #197

Earlier quoted context omitted.

No the value offered to the healthcare system. If a disease is costing a public/private payer $100K per year, if I price my drug at $30K per year and eliminates all other costs, I'm saving everyone $70K per year. That is offering real value and should be paid for.

So if I offer a drug that saves someones life, is the value the rest of their life, plus whatever society derives from that person too? Do I get to set a price that is 98% of that? I suppose they need something to live on so 80%? But then you see charities and and families holding out the tin cup so sick relatives can get their chemo treatment - so there's a path to extract some of the 'social' value of that person t…

So if I offer a drug that saves someones life, is the value the rest of their life

Yes, yes it is. That's exactly what the UK does. 30K GBP/QALY (quality adjusted life year).

People might not like it, but there are finite resources in this world and prices have to be put on everything, even people's lives.

Re: Why drug prices in America are so high (2016)

#200

Post by [deleted] »

dv_dt wrote: post #198
refurb wrote: post #197

Earlier quoted context omitted.

No the value offered to the healthcare system. If a disease is costing a public/private payer $100K per year, if I price my drug at $30K per year and eliminates all other costs, I'm saving everyone $70K per year. That is offering real value and should be paid for.

So if I offer a drug that saves someones life, is the value the rest of their life, plus whatever society derives from that person too? Do I get to set a price that is 98% of that? I suppose they need something to live on so 80%? But then you see charities and and families holding out the tin cup so sick relatives can get their chemo treatment - so there's a path to extract some of the 'social' value of that person t…

[deleted]
Post reply on HN