Dutch join backlash at expensive drugs by making their own • Hacker News Board

Re: Dutch join backlash at expensive drugs by making their own

#101

Post by replicatorblog » Sat, Mar 09, 2019, 10:28 PM UTC

aaavl2821 wrote: post #16

xorcist wrote: post #11

Earlier quoted context omitted.

> How did that patent end up in a big pharma portfolio? While it may sound strange put that way, most universities spend a lot of time thinking about how spin off profitable companies from their research. It's a huge deal and public spending on research is often motivated like this. Universities and R&D companies have a codependent relationship and this is generally regarded as a good thing. The morally dubious outco…

without for profit companies, all that taxpayer funded research would be sitting on a shelf, never becoming medicines to treat patients. In the last 2 years I think every drug that got approved by FDA was developed by a for profit company. Drugs don't emerge fully formed from academia, just waiting for pharma to patent them and jack up the price. Pharma spends more on r&d than academia

This is an important point. There's nothing to stop Harvard or Stanford from commercializing their research directly. They have massive endowments of financial and human capital.

The flip critique of the drug industry is to suggest they're basically taking miracle cures developed in toto in publicly-funded labs and taking pure profits.

If that were the case, shouldn't one of the dozens of well-capitalized research institutions just go to market?

The reality is the drug companies take on a tremendous burden turning high-level research into a product that works, including:

+ Formulating a product that will work at scale,

+ In widely diverse populations,

+ While eliminating potential side effects, + Adapting for human UX limitations,

+ Exhaustively guarding against adverse reactions,

+ At the same time, building production capacity,

+ Creates marketing materials for patients, but also to educate doctors who don't have scads of time to study new treatments,

+ Physically distributing the product

+ Monitoring the product fastidiously once it's on the market for negative reactions,

+ Sending humans to almost every doctor's office to answer any questions about the product,

+ While staffing a 24/7 customer service number to sort out any problems

It's not as easy as it's made out to be!

Re: Dutch join backlash at expensive drugs by making their own

#102

Post by consumer451 » Sun, Mar 10, 2019, 12:13 AM UTC

consumer451 wrote: post #99

aaavl2821 wrote: post #19

Earlier quoted context omitted.

Drug companies increasingly fund r&d with their balance sheet, not with internal r&d. So the money they pay for new drugs is not reflected in the profit and loss statement. There are maybe 15 pharma companies that commercialize a large portion of the drugs developed in the world. The vast vast majority of drug companies never make a penny in profit. They sell their products or companies to bigger, commercial companie…

I am pretty uninformed in this space, but the D in pharma R&D includes the cost of direct to consumer advertising, correct? I see a lot of expensive looking ads on TV. Those ads were made legal in my lifetime. Maybe it’s time to ban prescription ads again?

Too late to edit my original comment, but here is the history of direct-to-consumer marketing of prescription drugs.

https://en.wikipedia.org/wiki/Direct-to-consumer_advertising...

Re: Dutch join backlash at expensive drugs by making their own

#103

Post by aaavl2821 » Sun, Mar 10, 2019, 12:46 AM UTC

Pharmakon wrote: post #77

aaavl2821 wrote: post #68

Earlier quoted context omitted.

One could make a pretty good argument that a government funded drug research system would end up with more expensive drugs (in the form of higher taxes) than a for profit system Drugs, as a whole, aren't that expensive today compared to other healthcare. They make up 9.8% of US health care expenditure, which is pretty much middle of the pack compared to OECD countries. Hospitals, largely "non profit" (but sometimes m…

One could make a pretty good argument that a government funded drug research system would end up with more expensive drugs (in the form of higher taxes) than a for profit system. That sounds like a pretty interesting argument, but I notice that you didn’t actually make it. The rest of your post is full of claims sans evidence, and a lot of numbers out of context. For example how many of those newly approved drugs are…

Yeah making that argument would be beyond the scope of a HN post. I've also never seen a good argument that publicly funding drug research and dev would get us to a better place than today

Those approvals are all for new molecular entities. In 2018 39% of those were first in class, i.e. Drugs with a new or unique mechanism of action. The percentage of first in class drugs approved among all NMEs has been trending upwards. My guess would be that most of the rest are second / third in class, not just "lifecycle management" plays

It's actually much harder to do lifecycle management bs in pharma these days compared to 20 years ago. Yeah you can get patents, some may be enforceable, but insurance companies will not put up with that unless the "new" drug provides a real clinical benefit

http://www.hbmpartners.com/media/docs/industry-reports/Analy...

Re: Dutch join backlash at expensive drugs by making their own

#104

Post by marcell » Sun, Mar 10, 2019, 12:50 AM UTC

rocqua wrote: post #3

Yes, less payout on rare disease drugs is less of an incentive to research them. But: * Drug companies have profit margins of 15% on average indicating there is room. * many recent 'orphan drugs' were not newly developed, but off-label uses registered with the FDA for a whole new patent. * these drugs rely heavily on research done by universities through public funding. It stands to reason the public should get to be…

> Drug companies have profit margins of 15% on average indicating there is room.

This seems to contradict itself. 15% profit margin is not that great compared to the opportunity cost. Someone working at a drug company could in theory switch (retraining etc.) to working at, say, Google which has a 22% profit margin. I realize it’s not apples to apples, but that’s not a huge, monopoly level profit.

Re: Dutch join backlash at expensive drugs by making their own

#105

Post by aaavl2821 » Sun, Mar 10, 2019, 12:51 AM UTC

pkaye wrote: post #82

Pharmakon wrote: post #77

Earlier quoted context omitted.

One could make a pretty good argument that a government funded drug research system would end up with more expensive drugs (in the form of higher taxes) than a for profit system. That sounds like a pretty interesting argument, but I notice that you didn’t actually make it. The rest of your post is full of claims sans evidence, and a lot of numbers out of context. For example how many of those newly approved drugs are…

> rejiggered stereochemistry to keep a patent Can someone tell me how this patent extension works? If they improve on something, is that a new patent? Does the original patent expire or gets extended? Why couldn't someone else have discovered the new stereochemistry before the original inventor dose so? If the new discovery is not significant, wouldn't its be sufficient to use the generic form of the original chemist…

That patent gamesmanship is part of a strategy of "lifecycle management" where pharma tries to extend monopoly pricing beyond main patent expiry. It used to be much more effective. basically companies could do something like patent for ex a pill you take twice a day vs 3 times a day. Other companies can make generic versions of the 3x a day pill

Unless you provide a real clinical benefit, most payers will make docs write an rx for the 3x a day generic vs new 2x a day patent. So these lifecycle extension games certainly happen but it's not really that effective

Re: Dutch join backlash at expensive drugs by making their own

#106

Post by skinnymuch » Sun, Mar 10, 2019, 12:53 AM UTC

pkaye wrote: post #91

pard68 wrote: post #69

Earlier quoted context omitted.

In the US it takes: * 4 years undergrad, of which 90 credit hours must be a specific series of courses * 4 years PharmD, doctorate program * 1800 hours of internship At this point a student has met all requirements to sit for the two license exams (NAPLEX and MPJE[^1]):). Many students will elect for an additional period of education due to the competitive nature of pharmacist jobs in the USA. Those two extra opportu…

12 years of training... does that even make economic sense? Do pharmacists get paid a lot?

I know the pharmacists you see at CVS and other face to Facebook pharmacies make pretty good money. But those are the ones that only need 7-8 years as noted.

Re: Dutch join backlash at expensive drugs by making their own

#107

Post by aaavl2821 » Sun, Mar 10, 2019, 12:55 AM UTC

samfisher83 wrote: post #89

aaavl2821 wrote: post #68

Earlier quoted context omitted.

One could make a pretty good argument that a government funded drug research system would end up with more expensive drugs (in the form of higher taxes) than a for profit system Drugs, as a whole, aren't that expensive today compared to other healthcare. They make up 9.8% of US health care expenditure, which is pretty much middle of the pack compared to OECD countries. Hospitals, largely "non profit" (but sometimes m…

The NIH is by far the single largest contributor to drug R+D in this country. Pretty much every big pharma company is cutting R+D.

Johnson and Johnson invested $10.8B in r&d in 2018 compared to $34b nih budget. Merck spent $9.6b. Pfizer spent $8b. Bristol Myers spent $5b

Yes NIH is biggest single spender but pharma industry as a whole spends much more

Re: Dutch join backlash at expensive drugs by making their own

#108

Post by refurb » Sun, Mar 10, 2019, 12:56 AM UTC

Retric wrote: post #81

refurb wrote: post #72

Earlier quoted context omitted.

The ones doing basic research today have zero capability to do the development part. So you'd be looking at spending a ton of money to try and develop the needed expertise to bring a molecule all the way to market. Would that also include commercialization - things like marketing?

I don’t know. Clinical trials can already be outsourced, so that’s not a major issue. And only two countries allow for direct to consumer drug marketing so that’s clearly unnecessary. Honestly, this is simply not going to happen in the US so it’s hard to say what’s realistic.

I wasn't referring to DTC marketing. DTC is a small percentage of the marketing companies do.

Any yes, you can outsource running a trial, but you still need someone to design it, process the data, put together an NDA and submit for approval.

I can only imagine the complete clusterfuck that would be if it was all done by public employees.

Re: Dutch join backlash at expensive drugs by making their own

#109

Post by aaavl2821 » Sun, Mar 10, 2019, 1:00 AM UTC

consumer451 wrote: post #99

aaavl2821 wrote: post #19

Earlier quoted context omitted.

Drug companies increasingly fund r&d with their balance sheet, not with internal r&d. So the money they pay for new drugs is not reflected in the profit and loss statement. There are maybe 15 pharma companies that commercialize a large portion of the drugs developed in the world. The vast vast majority of drug companies never make a penny in profit. They sell their products or companies to bigger, commercial companie…

I am pretty uninformed in this space, but the D in pharma R&D includes the cost of direct to consumer advertising, correct? I see a lot of expensive looking ads on TV. Those ads were made legal in my lifetime. Maybe it’s time to ban prescription ads again?

The "d" is for development. Basically "research" is finding a potential drug (making a chemical that has an effect on disease in animal or in vitro models and has good pharmacological properties) and "development" is testing it in tox studies, scaling up manufacturing, testing it for safety and effectiveness in humans. There is a ton of risk and cost in the "development" stage

DTC ads would be in the marketing budget under SG&A

Re: Dutch join backlash at expensive drugs by making their own

#110

Post by aaavl2821 » Sun, Mar 10, 2019, 1:04 AM UTC

dmitriid wrote: post #95

aaavl2821 wrote: post #19

Earlier quoted context omitted.

Drug companies increasingly fund r&d with their balance sheet, not with internal r&d. So the money they pay for new drugs is not reflected in the profit and loss statement. There are maybe 15 pharma companies that commercialize a large portion of the drugs developed in the world. The vast vast majority of drug companies never make a penny in profit. They sell their products or companies to bigger, commercial companie…

R&D spending has been relatively stagnant. While industry revenue increased by 45 percent, or $241 billion from 2008 to 2014, industry spending on R&D increased just 8.5 percent in that same period, from $82 billion to $89 billion (GAO 2017). By some measures, R&D expenditures are actually falling, as more firms are outsourcing R&D to third parties. In that seven-year period, purchased R&D increased from $20.5 billio…

That links a 404 for me but I'd want to investigate the methodologies. The r&d numbers for the industry seem low as do the revenues, I don't know what sample of companies they used

Also don't know what criteria Bentley used to determine how much NIH research contributed to new drugs

This report provides another perspective and highlights the role of industry

http://www.hbmpartners.com/media/docs/industry-reports/Analy...