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Fed Up with Drug Companies, Hospitals Decide to Start Their Own

nytimes.com

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Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#211

Post by mawelch »

tkahnoski wrote: post #205
roadnottaken wrote: post #196

Earlier quoted context omitted.

I work in drug discovery. You're right that the bench-scientists don't usually get rich. But it's an extraordinarily risky, expensive, and unpredictable business and for every billion dollar drug there's a graveyard of failed companies and projects that didn't make it. The only business reason to take those risks are for a chance at patent-protected profit. And those bench scientists wouldn't have labs to work in if…

I was skeptical of this graveyard because it gets referenced a lot, largely due to how we humans constantly ignore the sunk-cost fallacy all the time. BUT it turns out the FDA is what prevents that from happening, and yes less drugs are getting approved. https://www.reuters.com/article/us-pharmaceuticals-success/s...

I think you're seriously underestimating how much thought goes into the risk-benefit analysis during drug development. The FDA does create some regulatory burden but they certainly aren't the main driver of why drugs fail. Drugs fail because they don't work or they cause unintended toxicity.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#212

Post by jonlucc »

pmyteh wrote: post #204
jonlucc wrote: post #199

Earlier quoted context omitted.

That sounds like a fantastic resource that I can not imagine passing in the United States any time soon. Is it funded along with the rest of the NHS?

Yes. In fact, its major remit is to improve value for money by targeting NHS treatments better. All of its meta-analyses and treatment guidance are available at http://www.nice.org.uk , if you want to explore.

This is really great; thank you for pointing me to it.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#213

Post by Kalium »

mannykannot wrote: post #195
indescions_2018 wrote: post #61

I always assumed it would be CVS that got into the game. There are are probably a dozen or so drugs that account for the majority of consumption. Flu vaccines, blood pressure, cholesterol, thyroid, insulin, asthma, progesterone, beta-blockers, gerd, etc. Providing these at minimum cost, as well as community public health services. Could be enormously cost effective. And extend general wellness and productivity many t…

I would not think that CVS, as a retailer, has much incentive - it is not paying the cost of the branded drugs. It is the insurance companies that I half-expected to make this move, unless there are anti-trust issues, or specific legislation (bought by the drug companies) to prevent them from doing so.

You're right! It's insurance companies and benefit managers that are heavily concerned with this.

CVS is acquiring Aetna and is one of the largest pharmacy benefit managers around.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#214

Post by yequalsx »

roadnottaken wrote: post #196
yequalsx wrote: post #191

Earlier quoted context omitted.

The people who do the actual discovery are not paid an exorbitant amount of money. They mostly just want to do research and solve problems while living a comfortable life. A pharma company making billions in profit isn’t necessary. It’s just the common way it currently is done. There are other ways to accomplish the same goal. We could try to replicate Jonas Salks’ way Of doing things.

I work in drug discovery. You're right that the bench-scientists don't usually get rich. But it's an extraordinarily risky, expensive, and unpredictable business and for every billion dollar drug there's a graveyard of failed companies and projects that didn't make it. The only business reason to take those risks are for a chance at patent-protected profit. And those bench scientists wouldn't have labs to work in if…

What about government funding research? It doesn’t have to be just rich people or corporations. It could be all of us in the form of government. I believe that most of a drug’s overall cost is marketing. I might be wrong on this but it is a significant, useless expense. Remove filthy rich profit motive and we might get drug companies that don’t resort to shenanigans.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#215

Post by robert_foss »

roadnottaken wrote: post #188
steiger wrote: post #182

Earlier quoted context omitted.

I live in Brazil and generics for drugs which patents are expired are widely available, accounting for 30~40% of all drug market. If I'm not mistaken, we even broke patents in some cases (HIV drugs), which is cool.

Why is that cool? Intellectual property law is necessary for industries like Pharma. No IP, no new drugs.

American pharma companies spend a lot more on marketing than R&D.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#216

Post by roadnottaken »

yequalsx wrote: post #214
roadnottaken wrote: post #196

Earlier quoted context omitted.

I work in drug discovery. You're right that the bench-scientists don't usually get rich. But it's an extraordinarily risky, expensive, and unpredictable business and for every billion dollar drug there's a graveyard of failed companies and projects that didn't make it. The only business reason to take those risks are for a chance at patent-protected profit. And those bench scientists wouldn't have labs to work in if…

What about government funding research? It doesn’t have to be just rich people or corporations. It could be all of us in the form of government. I believe that most of a drug’s overall cost is marketing. I might be wrong on this but it is a significant, useless expense. Remove filthy rich profit motive and we might get drug companies that don’t resort to shenanigans.

You are simply wrong on this. It costs hundreds of millions of dollars to develop a new drug, prior to approval and marketing. What percent of a companies budget is spend on marketing versus R&D at a given time is kind of irrelevant because (1) the development costs occur before market and (2) often drugs are in-licensed or acquired after significant expense towards R&D has been expended. They don’t buy all the companies whose products fail (most of them) so that cost isn’t factored in. Making new drugs is very expensive and risky.

Edit: I’m describing the development of novel drugs here. “Me-too” drugs are significantly less risky and probably less costly but there’s still a lot of risk amd expense.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#217

Post by GeekyBear »

thousandautumns wrote: post #192
GeekyBear wrote: post #179

Earlier quoted context omitted.

Research from the Pew Charitable Trusts shows that in 2012 alone 27 Billion dollars was spent by US Pharmaceutical companies to promote their drugs to doctors and patients. http://www.pewtrusts.org/en/research-and-analysis/fact-sheet... This is money that could have been spent on R&D instead of advertising if we moved to a non-profit pharmaceuticals model.

That's an incredibly naive take and one that completely fails to understand the realities of the economics of drug development. Considering that in 2010, Forbes estimated that the cost of bringing a single drug to market, was between $4-11 billion dollars, you are buying between 2-6 extra drugs per year. ( https://www.forbes.com/sites/matthewherper/2012/02/10/the-tr... ) But that fails to account for the fact that th…

We don't need 20 additional drugs that sort of treat one condition (albeit with serious side effects) that the pharmaceutical company prefers we use because the profit margin is higher on new formulations with no generic equivalent.

We need one additional drug that treats said condition better than the existing options, but with less side effects.

The profit motive distorts what is best for patients.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#218

Post by GeekyBear »

pmyteh wrote: post #198
jonlucc wrote: post #185

Earlier quoted context omitted.

Pharma researcher here (on the early science side, not market research or that kind of thing) I think people vastly overestimate their physicians' ability to stay on top of newly published research, and that includes new drugs' safety and efficacy profiles. If I want the stuff I work on to reach patients (and I do), then I want doctors to know about it. In the absence of pharma marketing dollars aimed at doctors and…

In Britain, we rely more on guidance from the National Institute for Health and Care Excellence (NICE). It does comparative reviews to make recommendations on the most suitable drugs to use. Motivation is primarily to restrict crazy-expensive drugs to those situations where they're actually going to represent value for (the public's) money, but also to point clinicians towards new approaches which can improve the qua…

In the United States, policy debates about implementing this sort of body led to them being referred to as a "death panel".

There is no logical reason why we shouldn't prefer an older generic medication if it treats the symptoms of a condition just as effectively and with fewer side effects than a newer option that is no more effective and has more side effects, but doing what is best for patients has to compete against the profit motive of our pharmaceutical companies.

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#219

Post by neuromantik8086 »

yequalsx wrote: post #214
roadnottaken wrote: post #196

Earlier quoted context omitted.

I work in drug discovery. You're right that the bench-scientists don't usually get rich. But it's an extraordinarily risky, expensive, and unpredictable business and for every billion dollar drug there's a graveyard of failed companies and projects that didn't make it. The only business reason to take those risks are for a chance at patent-protected profit. And those bench scientists wouldn't have labs to work in if…

What about government funding research? It doesn’t have to be just rich people or corporations. It could be all of us in the form of government. I believe that most of a drug’s overall cost is marketing. I might be wrong on this but it is a significant, useless expense. Remove filthy rich profit motive and we might get drug companies that don’t resort to shenanigans.

In an ideal world, I'd agree with you. In the real world, government funding (at least in the US) is often administered by bureaucrats without relevant scientific expertise to ensure proper oversight. Furthermore, the checks and balances for grant awards are lacking at the NIH/NSF/etc. The panels who decide who gets funding and who doesn't comprise researchers who are far from disinterested judges. Some grant approvals are less about scientific merit and more about rubbing elbows with the right people, which ultimately means that political capital becomes more important than substance in a lot of cases. I've seen large grants funded for experiments that from a methodological standpoint, made no sense, and yet the PIs who submitted the proposal were well-established and had connections.

Corporate science, in contrast, just wants results that work and earn money and as a result is more geared towards weeding out fruitless avenues of research. My general impression is that this is sometimes at the expense of creativity, since companies are more risk-averse generally speaking, which limits what is discovered to mostly non-sexy stuff. I also suspect (but am not certain) that replications are performed more routinely, and are just file-drawered / kept as trade secrets and that the current reproducibility crises in some fields (such as cancer research) have been known about for a while in industry.

Rich people just want to cure cancer, childhood obesity, condition X that afflicts them personally. It's hard to get funding for just basic research because philanthropists generally lean towards the applied side of things as well and don't go for the moonshots. It's not the best, but typically there's some common ground for researchers to get money out of them (or some way to make basic research look applied to an undiscerning eye).

Re: Fed Up with Drug Companies, Hospitals Decide to Start Their Own

#220

Post by mft_ »

EliRivers wrote: post #168
mft_ wrote: post #165

Earlier quoted context omitted.

Assuming you're referring to the general development and supply of all drugs (in particular new drugs, as well as generics) the simple answer is that the process of discovering and developing new drugs is both high-risk and also heinously expensive. As such, whoever approaches it needs to have many billions to spend and --very likely-- lose. The current capitalist Pharma model has developed to suit: investors in Phar…

I understand the drug companies ("pharmaceutical industry" in the link below) pay about 60% of the research costs. It's a lot of it, but it's not orders-of-magnitude bigger than the public contribution. https://www.thebalance.com/who-funds-biomedical-research-266... Some would suggest that the drug companies actually take on the lower risk research, leaving the high risk work to be funded by other sources: http://www…

It's not clear from the first article what sort of "research" is covered by the calculation, nor how they've come up with these figures. Lots of basic research is done which furthers our understanding of biology; whether this research results in new drugs is unclear.

-----

There are different routes by which new drugs are discovered, but very simplistically, we can break them down to two:

1) a researcher somewhere (not in Pharma) comes up with some positive research that might eventually result in the new drug for some disease. To develop this finding, often they will create (spin off) a new private company, and somehow generate funding. The extent to which the original funding institution benefits from this research is likely variable, based on the legal framework and contracts under which the researcher was operating. (And frankly, if a university or other institution doesn't benefit from such a discovery it funded in its labs... they're not doing something right.)

2) a pharmaceutical company funds its own discovery operations, which work to discover new targets and/or drugs for those targets

--

#1 is unpredictable, but can result in great new discoveries which are brought to market --and thus patients-- relatively cheaply (like in the hundreds of millions, rather than billions)

#2 is difficult, and very expensive, but mostly works - some pharmaceutical companies grind out drug after drug. However, ultimate success is less certain, and cumulatively, considering the cost of discovery operations as well as subsequent development, the cost is usually in the billions per successful new drug.

This is also why we're seeing a switch to a mixed model: big Pharma is increasingly spending big on smaller biotech operations with promising drug candidates, as a way of minimising risk.

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