The Hidden Monopolies That Raise Drug Prices • Hacker News Board

Re: The Hidden Monopolies That Raise Drug Prices

#131

Post by [deleted] » Thu, Mar 30, 2017, 7:06 PM UTC

jobu wrote: post #130

chimeracoder wrote: post #3

> Americans pay the highest health-care prices in the world, including the highest for drugs, medical devices, and other health-care services and products. Our fragmented system produces many opportunities for excessive charges. But one lesser-known reason for those high prices is the stranglehold that a few giant intermediaries have secured over distribution. The antitrust laws are supposed to provide protection aga…

I've been buying albuterol inhalers from Mexico for a several years now. Most of my life these inhalers cost a few bucks, but a few years back (2010?) they started costing me $50 for just the copay. It turns out the pharma lobby was able to get congress to ban CFCs from inhalers (even though the amount of CFCs in these is trivial). Because of that they were able to re-patent them and start charging more. Now I go to…

[deleted]

Re: The Hidden Monopolies That Raise Drug Prices

#132

Post by dikdik » Thu, Mar 30, 2017, 7:09 PM UTC

brandonmenc wrote: post #70

DarkKomunalec wrote: post #53

Earlier quoted context omitted.

> And no, the sales and marketing in that article is not advertising alone. It's mostly sales people who go and visit medical professionals to talk about their products. That's advertising. You mentioned 20% of their revenue is R&D - do you have a source, ideally listing what the other 80% goes to? That's a lot of unaccounted revenue, especially given how many drugs were shown to be dirt cheap to manufacture.

> That's advertising. Anecdotally, a friend of mine was doing post-doctoral work researching and developing cancer drugs. He now works on a pharmaceutical sales team as a scientific liaison. "Advertising" a drug involves a lot more than running TV commercials - it also includes former scientists making the current research digestible for doctors who don't have the time or specialized knowledge to do that in between s…

>The notion that every practicing doctor has enough free time - or is even smart enough - to keep up on the latest pharmaceuticals, is ridiculous.

That's part of the doctor's job, if they can't keep up with new medical/pharma literature then they need to find a different job. Further, most doctors know taking a ton of info from a pharma rep is just asking to be misinformed. A lot of pharma sales reps have no science background and many lie about approved populations and other aspects of a drug (just see the many, many lawsuits out there).

Re: The Hidden Monopolies That Raise Drug Prices

#133

Post by Broken_Hippo » Thu, Mar 30, 2017, 7:11 PM UTC

replicatorblog wrote: post #126

Broken_Hippo wrote: post #80

Earlier quoted context omitted.

"How much are you willing to pay the nine teams of scientists whose experimentation fails to yield any useful medications for every one that works?" The same yearly salary that the folks on the "success" team make. I don't see why success is the issue here. I'd just make sure the failure is public information so that others can learn from it. After all, the things that don't work aren't valueless and the drug may be…

Should we have two teams or twenty researching drugs? How should we prioritize them? Focus on a couple diseases that are extraordinarily hard technically, but impact a small number of highly sympathetic, photogenic victims as with rare childhood diseases? Or problems that treat low intensity pains that could also be treated with behavior change like heartburn drugs and Type II diabetes meds? What should we do if we f…

As many as possible, with international cooperation so that there is diversity. I'm not the best to know how to prioritize them because all have their benefits. I'm guessing there are different folks working on different aspects, and I hope this stuff continues.

I think the proper thing to do with things such as viagra would be to move them over to the proper research team once they become specialized: Viagra would be moved either to a men's health specialist or a sexual health specialist. Viagra can be commercialized, sure, but it can also make a huge difference in mental health - possibly for more than one person. And I do think we should sell them for recreational use as well, if there is that sort of use and use the profits to reinvest or let those be big pharma profits. Possibly in heart health, since lots of folks need that sort of thing.

Contrary to what my post says, I don't mind big pharma in itself. Sure, there are issues, but I don't mind them making profit. I just wish we'd do more - including making sure you don't have unaffordable premiums and deductibles just to live (as in my view, life is a human right if we can prevent the death).

Re: The Hidden Monopolies That Raise Drug Prices

#134

Post by refurb » Thu, Mar 30, 2017, 7:11 PM UTC

dikdik wrote: post #132

brandonmenc wrote: post #70

Earlier quoted context omitted.

> That's advertising. Anecdotally, a friend of mine was doing post-doctoral work researching and developing cancer drugs. He now works on a pharmaceutical sales team as a scientific liaison. "Advertising" a drug involves a lot more than running TV commercials - it also includes former scientists making the current research digestible for doctors who don't have the time or specialized knowledge to do that in between s…

>The notion that every practicing doctor has enough free time - or is even smart enough - to keep up on the latest pharmaceuticals, is ridiculous. That's part of the doctor's job, if they can't keep up with new medical/pharma literature then they need to find a different job. Further, most doctors know taking a ton of info from a pharma rep is just asking to be misinformed. A lot of pharma sales reps have no science…

That's part of the doctor's job, if they can't keep up with new medical/pharma literature then they need to find a different job.

Do you know any doctors? Have you talked to them about how they spend their days? Most want to maximize the time they spend with patients. Any way they can keep up to date on the latest technology is helpful.

Re: The Hidden Monopolies That Raise Drug Prices

#135

Post by refurb » Thu, Mar 30, 2017, 7:12 PM UTC

Retric wrote: post #112

brandonmenc wrote: post #70

Earlier quoted context omitted.

> That's advertising. Anecdotally, a friend of mine was doing post-doctoral work researching and developing cancer drugs. He now works on a pharmaceutical sales team as a scientific liaison. "Advertising" a drug involves a lot more than running TV commercials - it also includes former scientists making the current research digestible for doctors who don't have the time or specialized knowledge to do that in between s…

There are only ~50 new drugs a year, and many of those are highly specialized. So, it's really not hard to keep up with new drugs. The hard part is actually staying fresh on all the existing knowledge that you don't use regularly and some changes to best practices.

You realize that new data comes out on drugs constantly? Even drugs launched 10 years ago. Just take a look at all the medical journals.

It's not a one-and-done thing with learning about drugs.

Re: The Hidden Monopolies That Raise Drug Prices

#136

Post by refurb » Thu, Mar 30, 2017, 7:14 PM UTC

triangleman wrote: post #86

refurb wrote: post #44

Earlier quoted context omitted.

Drug companies spend the most on R&D out of any industry. The average is almost 20% of revenue. That means if you buy a drug for $1000, $200 of that goes back into R&D. And no, the sales and marketing in that article is not advertising alone. It's mostly sales people who go and visit medical professionals to talk about their products.

Someone had just posted a really useful post that was deleted about 15 minutes later. Here is the post copy/pasted in its entirety: EDIT: Wall of Text warning. >The average is almost 20% of revenue. This isn't exactly true. In fact the pharma industry lies so prodigously about it's own costs that it's almost impossible to know what they actually are spending on R&D. We can trace back the source of these numbers to va…

Ummm... the numbers reported by pharma companies has nothing to do with the estimate DiMasi's group did. The pharma numbers are SEC approved financial statements. That real cash going to R&D, not some pie in the sky estimate.

Re: The Hidden Monopolies That Raise Drug Prices

#137

Post by kbenson » Thu, Mar 30, 2017, 7:17 PM UTC

chimeracoder wrote: post #105

kbenson wrote: post #101

Earlier quoted context omitted.

I think fundamentally what we have here is the collision of socialism and capitalism, and I'm not sure how to make those work at the margins where they meet. Government funding of research is socialism, but selling the developed drugs is capitalism, and selling them outside the funding country without an increase in price costs the funding country. I'm not sure what the research on this topic says, but I suspect the…

> I think fundamentally what we have here is the collision of socialism and capitalism, and I'm not sure how to make those work at the margins where they meet. Government funding of research is socialism, but selling the developed drugs is capitalism, and selling them outside the funding country without an increase in price costs the funding country. I don't think you really want to call what happens in Europe and Ca…

I'm not labeling countries socialist and capitalist, I'm labeling practices such. I was talking about socialism and capitalism purely within the context of the U.S.

Government funding of medical research for the good of its citizens is socialistic. Selling developed drugs on the market is capitalistic. When you use government funds for something which is eventually sold, but the government doesn't receive any direct compensation, there's a friction between the socialistic and capitalistic forces at play, and that's what we've been discussing.

To be clear, I've made zero claims as to what is better, just that dthey engender different incentives that don't always play well with each other. My personal view is that there are definitely things we want the state to handle (some degree of welfare including health, some level of regulation of various parts of the economy), but the details as to how much government control are the important bits. Purely socialist and purely capitalist environments don't seem to function nearly as well as a mix, from what I've gleaned from history.

Re: The Hidden Monopolies That Raise Drug Prices

#138

Post by refurb » Thu, Mar 30, 2017, 7:17 PM UTC

jcfrei wrote: post #87

rayiner wrote: post #64

Earlier quoted context omitted.

So that's an article on how pharma companies spend more on sales and marketing than research. But many companies we'd consider "innovative" spend about twice as much on SG&A (sales, general, and administrative) as on R&D. For 2014-2015, the ratio between R&D spending and SG&A spending is 0.59 at Pfizer, 0.75 at Google, 0.56 at AstraZeneca, 0.43 at Apple, and 0.58 at Microsoft.

I'm skeptical that pharma companies should require equally high levels of marketing spending as other industries. After all most expensive pharmaceutical products are bought through an expert (ie. your physician). There's not a huge discoverability problem to be solved for those companies - or at least there shouldn't be - after all there's a national drug directory run by the FDA. Furthermore the US is one of only t…

Doctors vary a lot by how up to date they are on new drugs. Some are focused on research, read all the latest journal articles and could teach pharma companies a thing or two.

Then there are the physicians who prefer to spend time treating patients. Maybe they are a generalist and don't have time to learn about every new drug. A brief conversation with a sales rep might point them in a right direction to learn more.

Re: The Hidden Monopolies That Raise Drug Prices

#139

Post by refurb » Thu, Mar 30, 2017, 7:20 PM UTC

txmx2000 wrote: post #120

> The Pharmaceutical Care Management Association, the industry’s lobbying group, claims that PBMs will save health plans $654 billion over the next decade. That's about $16 per person per month. Not a very compelling argument for keeping your drug monopolies: eliminating them costs little more than a Netflix subscription.

Keep in mind that insurance companies make decisions based on a change in cost of only $0.05 per member. $16 per person is HUGE when you're talking about an insurer who covers 30M+ people.

Re: The Hidden Monopolies That Raise Drug Prices

#140

Post by refurb » Thu, Mar 30, 2017, 7:23 PM UTC

code_duck wrote: post #89

refurb wrote: post #13

Earlier quoted context omitted.

Have any examples? The FDA won't approve a drug unless safety and efficacy have been proven.

Unfortunately that process is a lot more complex than one might think, like everything else involving medicine, government, or even worse, a combination of the two. Safety and efficacy are not a binary condition, either. Questions you might ask are, how effective does a drug have to be to be approved? Is it better to have false positives or false negatives? Who pays for and conducts the studies, and who reviews them?…

Every drug is approved based on a risk vs. benefit analysis. The FDA can't know exactly what will happen when the drug is approved since you can't test a drug on every patient prior to approval (that would be unethical).

No one should be surprised when a few drugs are pulled off the market post-launch. I would argue the FDA didn't make a mistake here and the system works.