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

nytimes.com

221–230 of 244 posts

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

#221
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…

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.

As much as I understand your underlying horror that so much money is spent on promotion, I think you're missing a major point.

Let's assume, for a moment, that the people running these Pharma companies aren't stupid. We can therefore assume that they will mostly make sensible decisions on how to spend money. It therefore follows that a company calculates that by spending $X on promotion, they'll recoup $X+$Y, where Y is the additional revenue thanks to their promotion, over and above what they'd have made without promotion - i.e, their promotional spend is a worthwhile investment for them.

For each company individually, therefore, promotional spend can be reasonably assumed to generate greater revenue and profit, some of which will be used to fund research into new medicines.

Now, like you, I'd much rather live in a world where there was no promotional spend, and correspondingly lower drug prices... but that's not the current world. And pointing a finger --'but, marketing, sales reps'-- at promotion is not the full story.

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

#222
post #198

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…

To support the commenter you're replying to, I have seen --first hand-- examples of patients receiving better treatment with very cost-effective drugs (which sailed through NICE) due to the efforts of staff from pharmaceutical companies.

Don't assume that all doctors are committed to making the latest advances (or even older advances) available to patients. They are human, just like all of us, and you'll find stubborn doctors on the conservative (or laggard) end of the spectrum just as much as within any other group or career.

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

#223
post #153

Earlier quoted context omitted.

You can do the NHS way and forbid paying for unwarranted procedures for life extension. Can't find data right now, but a generally healthy person will spend most of it's lifetime healthcare expenses on its last 2 years. NHS adopts this measures in the so called death panels. So it can have money to fund preventive care and promote healthy lifestyles.

> You can do the NHS way and forbid paying for unwarranted procedures for life extension. Please cite which of these procedures are forbidden. > NHS adopts this measures in the so called death panels The US has these too, in the form of insurance companies. I think if you're going to have them it's better to ahve them be publically owned not for profit organisations under intense government regulation, rather than pr…

NHS guidelines is to not extend a terminal patient's life indefinitely. Not sure the explicitly reason is costs but having people months on intensive care is pretty darn expensive

http://www.telegraph.co.uk/news/health/news/6127514/Sentence...

Also, it had a policy of not funding what they call "procedures of limited clinical value"

http://www.miltonkeynesccg.nhs.uk/referrals-and-priorities-p...

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

#224

Earlier quoted context omitted.

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.

You've got an overly negative and simplistic view of the Pharma industry.

For sure, there are plenty of examples (do we need that many statins? do we need so many beta blockers?) to suit your narrative, but you're also missing the huge sums spent and strides taken in other areas, such as oncology. If you don't show a meaningful benefit here, your drug is a failure - it's that simple.

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

#225
post #198

Earlier quoted context omitted.

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 agai…

> 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

There are checks on this, and I'm not sure if you are thinking of a particular case, but I can't really see how this would happen. In order to get approval, a new drug almost always has to demonstrate that it is at least "non-inferior" to the standard of care. Additionally, there is a lot of pressure in the United States from payers. Insurance companies just won't pay for a drug that is in no way better than the previous standard of care with more detrimental side effects. There are definitely cases where the FDA made a mistake for one reason or another (allowed an entity to move through the wrong approval mechanism, were duped by fraudulent AE reports and didn't catch it, failed to require the appropriate screens for AEs, etc), but the system has some checks on drug companies.

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

#226
post #43
post #37

Earlier quoted context omitted.

But is the high cost of those surgeries a product of the broken system? I say yes.

In Canada, developing an accidental MRSA infection after a routine surgery will trivially turn a $5000 procedure into a $25,000 package of life-saving treatment and associated hospital stay. When things go bad in medicine, your bill grows really, really, really fast. Also, unlike a mechanic with a car, your doctor can't stop working on you after they blow through their quoted budget and ask if you still want to pay f…

I certainly don't get more money if I accidentally introduce critical crash-to-desktop bugs, and then spend more time fixing them. I get paid to do the job to a minimum standard of quality. The customer is paying for the outcome they want, not for the amount of work it takes to get there. The Labor Theory of Value rears its ugly, no-good keister again.

If an actuary can quote me the price of a life insurance premium 40 years before a person is expected to die, such that the company doesn't lose money, a hospital can figure out how to price its services such that it doesn't go bankrupt. Those wailing about too many uncontrolled variables are just trying to suck the last available penny out of the patients. How can they possibly nickel-and-dime people to death on their itemized bills if they don't know exactly how many cm of plastic tubing will be needed for the surgery?! How can they charge $25 per 500mg analgesic pill if that is already included in the published price of the procedure?! It's really only a problem if your mission is to suck out all the consumer benefit of trade via price discrimination.

If my auto mechanic blows past their original quote, they don't stop work and ask for more money. They fix the danged problem, charge what they said they would, and try to estimate better on the next job. And they certainly don't plow ahead, replace the engine and transmission and exhaust system, laser-scour the rusted body panels, put on new tires, repaint the exterior, reupholster the interior, clean all the crap out of the trunk, fill up the gas tank, and then try to charge me $120k to get my 2001 Civic back. The doctor can't stop working, but they can stop charging extra for it. If I knew ahead of time that it would have cost that much, I probably would not have consented to the procedure in the first place.

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

#227

Earlier quoted context omitted.

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 compa…

>We found that the premiums pharmaceutical companies earn from charging substantially higher prices for their medications in the US compared to other Western countries generates substantially more than the companies spend globally on their research and development. This finding counters the claim that the higher prices paid by US patients and taxpayers are necessary to fund research and development. Rather, there are billions of dollars left over even after worldwide research budgets are covered. To put the excess revenue in perspective, lowering the magnitude of the US premium to a level where it matches global R&D expenditures across the 15 companies we assessed would have saved US patients, businesses, and taxpayers approximately $40 billion in 2015, a year for which the Centers for Medicare and Medicaid Services (CMS) reported that total US spending on pharmaceuticals was $325 billion.

Curious to hear your thoughts.

https://www.healthaffairs.org/do/10.1377/hblog20170307.05903...

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

#228

Earlier quoted context omitted.

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 agai…

> 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 There are checks on this, and I'm not sure if you are thinking of a particular case, but I can't really see how this would happen. In order to get approval, a new drug almost alw…

>I'm not sure if you are thinking of a particular case, but I can't really see how this would happen.

Does Purdue Pharma's decision to push opioids as a safe treatment for everyday pain ring a bell?

https://www.newyorker.com/magazine/2017/10/30/the-family-tha...

Oxycontin was certainly profitable, but it was not good for patients with chronic pain.

This is a case where a Pharma company deliberately misled doctors, patients and regulators because doing so was exceptionally profitable.

>The company that makes the narcotic painkiller OxyContin and three current and former executives pleaded guilty today in federal court here to criminal charges that they misled regulators, doctors and patients about the drug’s risk of addiction and its potential to be abused.

http://www.nytimes.com/2007/05/10/business/11drug-web.html

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

#229
post #221

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.

As much as I understand your underlying horror that so much money is spent on promotion, I think you're missing a major point. Let's assume, for a moment, that the people running these Pharma companies aren't stupid. We can therefore assume that they will mostly make sensible decisions on how to spend money. It therefore follows that a company calculates that by spending $X on promotion, they'll recoup $X+$Y, where Y…

You seem to be ignoring the larger problem.

Having the pharmaceutical industry arrange everything around the notion of "what is more profitable to us" leads them to ignore the notion of "what is best for patients with this condition".

If unbiased studies show that their treatment is more effective and has less side effects than existing options, then it should become the usual treatment for that condition.

Otherwise, no amount of advertising and promotional activity on their part makes sense when approached from the notion of what is best for patients.

In the case of promoting Oxycontin to treat chronic pain, real harm has been done.

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

#230

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.

If you study the subject of drugs R&D carefully, in most of the cases companies break even in 1 or 2 years after the release of the drug.
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