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Novo Nordisk facing pressure as study finds $1k drug can be made for $5

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Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#171

Post by tacticalturtle »

FireBeyond wrote: post #147
ethanbond wrote: post #39

Earlier quoted context omitted.

No it’s also ludicrously expensive to R&D a drug, even if you just count the costs of the successful program. You’d be looking at easily $50-$150MM just in clinical trial costs, not to mention the years or decades of preclinical work. Factor in the failed programs and you’re looking at about $2B of spend in order to bring a drug to market.

Of the top 10 pharma companies, 5 are American, and three of them rank 8th, 9th and 10th for R&D investment. So the whole "American big pharma needs to make a billion dollars a week in profit to recoup their R&D" is nothing but marketing fluff.

Does it matter that only some of them are headquartered in the US? Presumably those other companies also sell drugs in the US?

I would think any company - regardless of where it’s headquartered - would seek to recoup R&D costs in a huge market like the US where prices aren’t capped by the government.

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#172

Post by RealityVoid »

I strongly success people listen to the Aquired episode on Novo Nordisk. It's quite interesting and we'll researched.

https://www.acquired.fm/episodes/novo-nordisk-ozempic

If you don't want to listen, there is the transcript right there on the page.

In there, they mentioned "It's pretty interesting. Pharma as a whole of the medical pie only occupies about 13% of revenue."

”The administrative costs of health insurance are 8%."

"I will say, who is taking any risk in this whole ecosystem? It's only pharma. Who's taking risk to innovate and make anything better? Every other bet that a hospital makes or that an insurance company is just probably going to pay off."

Say what you will, but pharma is pushing healthcare forward so I am not against them making money. Of course, I also don't want people to have lack of healthcare access because merely money, so there is a line to tow here.

The way insurance and drug pricing works in the US is bonkers and I would not solely blame pharma for that.

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#175

Post by Scandiravian »

pfdietz wrote: post #154
Scandiravian wrote: post #102

Earlier quoted context omitted.

Can you elaborate on how other countries are free riders? It's not like the board at Novo has a board meeting where they decide "we hate the US so lets charge them more for our products" The simple fact is that the US has higher drug prices because it has created a healthcare system that allows pharmaceutical companies to charge much more for their products The way to lower drug prices is to change the system to prev…

They have monopsonies. The drug maker has a choice of either losing some operating profit or going along with the price they set. The free riding is in these countries not paying a price that pays their share of the development cost of the drug.

The US made a decision to prioritise corporations over their citizens

I get that it's easier to blame other countries for "free-riding", than to acknowledge that the US itself is to blame for the way it has decided to structure itself

If the population in the US want affordable healthcare, then they need to fight for it. That's what we did in Europe

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#176

Post by ethanbond »

FireBeyond wrote: post #147
ethanbond wrote: post #39

Earlier quoted context omitted.

No it’s also ludicrously expensive to R&D a drug, even if you just count the costs of the successful program. You’d be looking at easily $50-$150MM just in clinical trial costs, not to mention the years or decades of preclinical work. Factor in the failed programs and you’re looking at about $2B of spend in order to bring a drug to market.

Of the top 10 pharma companies, 5 are American, and three of them rank 8th, 9th and 10th for R&D investment. So the whole "American big pharma needs to make a billion dollars a week in profit to recoup their R&D" is nothing but marketing fluff.

I… am not following this. Novo Nordisk for example is a Danish company.

I haven’t seen anyone say American pharma companies in particular need to make a ton of money.

The American-specific topic is that American consumers pay a ton more for drugs. That can be chalked up to lack of single-payer making American consumers incredibly easy to bully/negotiate against + all the rent-seekers who sit at various points along the care delivery system.

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#177

Post by thereisnospork »

amelius wrote: post #53
karles wrote: post #9

Producing it is not the hard part. Researching it is... And you are not paid for your research "up front". It's added to the cost afterwards.

Society contributed to that research in the form of education, academia, infrastructure, ...

And for that investment society now has a new drug anyone can make at cost from t+20 year till forever. I'm not seeing how society is getting screwed here in the big picture.

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#178

Post by nabla9 »

Scandiravian wrote: post #136
nabla9 wrote: post #118

Earlier quoted context omitted.

Apples to oranges comparison. Revenue to GDP is better. Novo Nordisk $35 billion in revenue. GDP of Denmark:$400 billion. Their revenue is roughly 9% of GDP.

I think that depends on what I'm trying to illustrate There's a lot of pensions and savings tied up in Novo stock, so a potential downturn would have a catastrophic impact on the danish citizens The danish economy is, to a large extend, dependent on the stock price of Novo, not its revenue

Asset values should be compared against asset values.

Novo Nordisk makes 17% of Danish stock index. Vestas and DSV are both 10%

(Foreign investors' ownership of listed Danish shares is over 50%, so I assume the situation is similar to NN when you remove the foundation owned stocks)

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#179

Post by Scandiravian »

pfdietz wrote: post #166
Ekaros wrote: post #157

Earlier quoted context omitted.

These companies are not selling drugs at loss in these countries. And these countries are not forcing the sale of drugs in the first place. The companies choose to take some profit over none. That does not make smarter countries that do negotiation anyway free riders.

Indeed, they are not selling the drugs at a price that is below their marginal costs. But they are also not selling drugs at a price that compensates them for the development cost, including the cost of drugs that didn't reach the market. They are free riding on this latter part.

That's a pretty strong claim. Do you have a source for that?

Re: Novo Nordisk facing pressure as study finds $1k drug can be made for $5

#180

Post by credit_guy »

lostlogin wrote: post #48
karles wrote: post #9

Producing it is not the hard part. Researching it is... And you are not paid for your research "up front". It's added to the cost afterwards.

There is an awful lot of sympathy for the drug company in this thread. You are correct, research and approval is expensive. But at some point there is a limit. Things like insulin are long paid off, and the pricing there has generated controversy. People have been charged $1000 a month for it [1]. What’s fair? They are screaming out to be regulated when they behave so badly, and that’s what’s happened with insulin. […

> But at some point there is a limit.

But we are nowhere close to that point. Ozempic is going off patent in 2031. It is a new drug, and it happens to be a miracle drug. Why should the company that brought the drug to market not monetize on it?

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