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

How pharmaceutical industry financial modelers think about rare diseases

cureffi.org

Post reply on HN
Print view View original

31–40 of 159 posts

Re: How pharmaceutical industry financial modelers think about rare diseases

#31

Post by sara12318 »

World's biggest cat Even you can't believe it's size See her video https://howto105.blogspot.com/2019/04/worlds-biggest-cat.htm...

See the video a dog shopping and lots of other acts like humans http://bit.ly/2DCpo9I

Fish walking with legs like humans See the video on link below http://bit.ly/2XRGyYD

This couple is different Girls are both twins and boys are also twin brothers see how they look in video http://bit.ly/2VwoZQd

A cute dog is dancing in video Just watch this video and try to control your laugh http://bit.ly/2ZK1XVs

Re: How pharmaceutical industry financial modelers think about rare diseases

#32

Post by jonlucc »

modzu wrote: post #26

Pharmaceutical companies typically claim that the reason for high drugs prices is because of the amount that they spend on research and development (R&D). According to the industry, it costs USD $2.6 billion to bring a drug to market [1]. Critics counter that companies are more focused on and spend more on promotion than on R&D. Gagnon and Lexchin produced figures that showed that in the United States in 2004 the ind…

I work in pre-clinical pharma research, so I would love more pharma R&D spend more than most people, but I don't see a problem with promoting approved drugs for their approved indications. The industry has to get the word about new approvals to physicians as quickly as possible, because the patent term is limited. It would be foolish to trickle a new drug into the market post-approval, and it might even be unethical, as patients who could benefit would be less likely to have access. How to structure that marketing spend is another discussion (and could use a good deal of overhaul in my opinion), but the need to market new products is not that unusual.

I'm not super familiar with costs in tech startups, but do most companies spend less on marketing than product development?

Re: How pharmaceutical industry financial modelers think about rare diseases

#33

Post by maksimilian »

cknoxrun wrote: post #27
loceng wrote: post #22

Earlier quoted context omitted.

I wonder how many times over tests were done by competing companies, duplication, and how much waste/inefficiency there was because of data not being shared - and how much further duplication may continue to happen.

My project in University (and now my company) annoyed a lot of companies when we first published DrugBank in 2006. We basically opened up the data on potential APIs and their targets into a downloadable and useable data set. I remember going to conferences and being both lauded by academics and maligned by pharma folks. This was before Wikipedia or things like Pubchem and ChEMBL were really a thing.

Weren't these things already public knowledge? Did the pharma folks just dislike that you made it easily accessible?

How do you make money off of DrugBank now?

Re: How pharmaceutical industry financial modelers think about rare diseases

#34

Post by refurb »

vibrio wrote: post #7
btown wrote: post #4

This article does a good job showing how big an impact the concept of "time value of money" can have on a multi-year investment of any kind - pharmaceutical or not. (Particularly since many of us in software are effectively investing nontrivial amounts of our salary in illiquid investments.) I'd imagine that many tend to think of a $X investment as a $X investment... but if that investor could get effectively compoun…

This is nicely stated. There is much wrong with the pharmaceutical industry including pay-to-delay generics, and abusive pricing non-innovative drugs, and that needs too be fixed. Maybe more importantly, effectively communicating the costs and risks of drug development has, and the magnitude of the impact of successful drugs have on the improvement of health care is something the industry has done poorly.

There is much wrong with the pharmaceutical industry including pay-to-delay generic

I disagree on this one.

Pay-to-delay is just the branded drug manufacturer and the generic company splitting the difference through negotiation. What you end up with something in-between the two potential outcomes.

Situation: branded drug has 2 more years of patent life, but generic company wants to challenge it; neither party is sure they will prevail.

Outcome 1: patent holds and branded manufacturer gets entire market for two years/generic company loses money on legal fees

Outcome 2: patent holder loses patent and money on legal fees/generic company gets entire market for two years (yes, typically this doesn't happen, trying to simplify)

Instead of each party going to court and paying a ton in legal fees with an uncertain outcome, the pay-for-delay is splitting the difference. The branded manufacturer pays the generic company $X to delay entry until year 1. Everybody gets something from the deal.

They call it "pay-to-delay", but that ignores outcome #1, where the generic is delayed for an even longer period.

Re: How pharmaceutical industry financial modelers think about rare diseases

#35

Post by refurb »

modzu wrote: post #26

Pharmaceutical companies typically claim that the reason for high drugs prices is because of the amount that they spend on research and development (R&D). According to the industry, it costs USD $2.6 billion to bring a drug to market [1]. Critics counter that companies are more focused on and spend more on promotion than on R&D. Gagnon and Lexchin produced figures that showed that in the United States in 2004 the ind…

Companies don't spend $X on promotion unless they gets $X+ back. Otherwise why bother? So overall, promotion is a net positive to revenues.

Re: How pharmaceutical industry financial modelers think about rare diseases

#37

Post by mattkrause »

ekianjo wrote: post #20
lotsofpulp wrote: post #8

Earlier quoted context omitted.

The only change I can see is needing to increase the cost of the medicine to make up for the reduced exclusivity period, or a reduced incentive to research medicine.

You can't just reduce the patent period without reducing the regulatory process that is required to get stuff approved. It would not work otherwise.

The FDA has a mechanism (market exclusivity) that is intended to compensate for regulatory delays.

Re: How pharmaceutical industry financial modelers think about rare diseases

#38

Post by gumby »

Having been through the early phases of this (both as bench scientist and management, up through Phase II) I can say that this author's analysis is right on.

There is a macro wrinkle he doesn't mention and that makes things worse: as we increasingly succeed on stopping the big killers (e.g. lung cancer, CIs, various accidents that constituted most of the causes of death into the 1990s) the histogram of death starts to flatten out. That is, an increasingly larger set of conditions kill people, each condition killing a smaller number. At the limit, everybody would die of a unique condition.

This "problem" has been well understood for decades. The current model doesn't really work as this process continues, but nobody really knows yet what would be a reasonable replacement. This is one reason you see more and more ads for drugs that don't solve anything life threatening but have a larger prevalence (e.g. incontinence, insomnia, et al).

Re: How pharmaceutical industry financial modelers think about rare diseases

#39

Post by aaavl2821 »

This is a fantastic writeup. There isn't a lot of great info online about the business of pharma but this is a great intro that hits on a lot of key concepts.

If you play around with a model like this you see how important biology is. the risk that something that works in mice but fails in humans is the biggest reason drugs are so expensive to develop. Front loading this risk / lowering the cost to "derisk" this risk is one of the most important things to focus on

One other concept that's incredibly important but not discussed is "unmet need", i.e. How underserved are patients by standard of care. For a fatal rare disease, unmet need is high; for a disease with drugs that already work pretty well the unmet need is low. Unmet need + clinical benefit (how much does your drug make patients better) determines clinical value, which is roughly correlated with price you can charge. Price isn't directly determined by cost-benefit calculations in the US, but it's harder for payers to deny a drug if it would save lives, while payers can easily sideline for ex another slightly better yet more expensive insulin

Some people view the phenomenon of higher prices for higher benefit as exploiting sick patients; I don't think that's entirely fair although in cases like Martin shkrei it is. I've always thought of it as aligning drug makers incentives with the sickest patients -- you only have a viable product if you are providing immense clinical benefit to very sick patients. So r&d is very focused on diseases with severe unmet need. These days roughly half of drugs are developed for patients with severe rare disease or late stage cancer, as most other diseases aren't financially viable

Re: How pharmaceutical industry financial modelers think about rare diseases

#40

Post by cbhl »

Looking at these numbers, I wonder whether the FDA process is a bit too conservative with respect to safety.

There were the articles yesterday about diabetics yesterday creating closed-loop feedback systems out of old insecure parts, because a FDA-certified alternative is decades out.

I've heard also of folks joining studies for newer-and-better IUDs that are approved by European regulators, but need to be re-certified for the US market.

Politics and lobbying are hard, but would some regulatory changes result in a 10x reduction in R&D costs?

Post reply on HN