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Why drug prices in America are so high (2016)

economist.com

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Re: Why drug prices in America are so high (2016)

#181

Post by harryh »

maxerickson wrote: post #180
harryh wrote: post #178

Earlier quoted context omitted.

Ya, I generally agree that Mississippi run medicaid should probably be paying less for drugs than Connecticut run medicaid. I can see how that might be tricky to get to politically though.

The federal share of Medicaid does vary by state: https://www.medicaid.gov/medicaid/financing-and-reimbursemen... https://aspe.hhs.gov/basic-report/fy2017-federal-medical-ass...

That's about funding though right? And now about how much the individual state programs pay for things (like prescription drugs). In the end does it work out to be the same thing? Maybe? I'm uncertain.

Re: Why drug prices in America are so high (2016)

#182

Post by maxerickson »

harryh wrote: post #181
maxerickson wrote: post #180

Earlier quoted context omitted.

The federal share of Medicaid does vary by state: https://www.medicaid.gov/medicaid/financing-and-reimbursemen... https://aspe.hhs.gov/basic-report/fy2017-federal-medical-ass...

That's about funding though right? And now about how much the individual state programs pay for things (like prescription drugs). In the end does it work out to be the same thing? Maybe? I'm uncertain.

It's at least a similar sort of thing.

Critical access hospitals and rural health clinics probably overlap too, where Medicare pays out to smaller qualifying facilities using a different formula.

Re: Why drug prices in America are so high (2016)

#183

Post by refurb »

dv_dt wrote: post #173
refurb wrote: post #132

Earlier quoted context omitted.

Pricing in the US is not cost-based. That's not how it works. If you price a drug at $100, you can't raise it to $110 to pay for marketing. You set the price at $100, then decide what to do with the profit. If marketing costs $10, but increases your sales by 15%, then you have a positive ROI.

> Pricing in the US is not cost-based I think this speaks for the whole issue ... there are some markets where this makes sense. I don't believe that it makes any sense in the healthcare market - and per-capita US healthcosts vs other nations would seem to bear that out.

Pricing isn't cost based in any developed country. It's value based.

The only market that is cost based are generics.

Re: Why drug prices in America are so high (2016)

#184

Post by aianus »

TheCoelacanth wrote: post #163
calvinbhai wrote: post #91

Drug prices in US go up because of collusion between Insurance Companies and Drug manufacturers. Would I buy expensive health insurance if drugs cost me $100 a month? Most probably never. What if the sticker price for my monthly dose of drugs was $10,000 or $50,000? You bet I'd go get an insurance that'd cost $500 a month. With such sticker shock, manufacturer reaps in profits. Insurance companies get to charge highe…

Or even simpler, just allow people to buy the drugs elsewhere and import them into the US. With most products that is allowed, which through market pressure keeps prices from diverging too much between different countries. With drugs it is not allowed, so drug prices can diverge to a much greater extent.

This will either kill people in poor countries that can't afford to pay more or it will cripple new development of drugs since the successful drugs really do need huge profit margins to pay for all of the losers that never made a dime.

Re: Why drug prices in America are so high (2016)

#185

Post by sigil »

"Why can't we just control prices?" wonders a publication called The Economist in the second graf.

This article doesn't meet the Hacker News bar for me. Why read a shallow, dataless, meandering, "could the grass be greener" thinkpiece when you could be reading and discussing a deep statistical analysis like:

High US health care spending is quite well explained by its high material standard of living https://randomcriticalanalysis.wordpress.com/2016/09/25/high...

The two follow up posts on that blog (Random Critical Analysis) are also quite good. So many surprising discoveries await us in the actual data, but I guess opining and confirming bias is more fun? If real journalism is going to require active philanthropy to survive, I'm funding the kind of critical analysis on open data sets that makes me think & rethink, not the kind of stuff that makes me go "that's just, like, your opinion, man." This article was the latter.

Re: Why drug prices in America are so high (2016)

#186

Post by _jal »

narrowrail wrote: post #167
_jal wrote: post #56

Earlier quoted context omitted.

This is very, very important. The drug market is one of the farthest things we have from a free market in the US outside of military weapons. It is just massively dysfunctional due to a combination of special interest lobbying combined with stepwise path-dependency. A huge part of the health care discussion in the US starts from assuming our current system is somehow natural. It isn't. It is an engineered thing, with…

>why the US is such a special snowflake that what works in various ways in every other first-world country cannot work here. I don't care for this argument simply because the US was the first country to throw off monarchical rule. Why the need for homogeneity? Shouldn't we have as many different implementations as possible? Personally, I don't care for centralized power (i.e. Facebook). Didn't Google take a different…

> I don't care for this argument simply because the US was the first country to throw off monarchical rule.

I'm sorry you don't like it. We have an interesting history, but I do fail to see the relevance of a centuries-old political dispute to the question of modern healthcare policy[0].

> Why the need for homogeneity?

This is a strange question. This seems to presuppose that all other first-world countries have identical single-payer or something. The structure of healthcare in the developed world takes many different forms - see [1] for a sampler. All of them work better than what we have, for cheaper.

Personally, I'd be fine with any of those models. Or, if you have a new one, please, let's hear it - just about anything is going to be better than what we have[2].

> Shouldn't we have as many different implementations as possible?

Unless you want to throw a lot of money and lives away, no.

Generally, one experiments with different things in order to find out what works. We have a fairly decent, if not great, idea of things that work and things that don't. A huge swath of "things that don't" probably shouldn't be tried again, because that leads to suffering, death and wasted money. I'm all in favor of refining something that works into something that works better, and we should do that. But we need to get to the "something that works" part, first.

> Personally, I don't care for centralized power

Good. Me, too, and I think too few people feel that way. Unfortunately, if you're looking for decentralization in healthcare, you're still in the wrong country.[3]

Bottom line for me: If, in fact, the U.S. is supposed to be exceptional, supposed to be showing the way, supposed to be a better place, why do we tolerate a sixth of our economy being a shit-pit of waste, misery and dysfunction?

[0] For the pedantic, modulo constitutional issues, path-dependence through legal precedent, convincing people that somehow our government/land/people/animating spirit is so magically special that somehow economics, game theory and human nature don't apply to us, etc.

[1] https://en.wikipedia.org/wiki/Universal_health_care

[2] https://www.forbes.com/sites/danmunro/2014/06/16/u-s-healthc...

[3] http://www.allhealth.org/health-care-consolidation-trends-im...

Re: Why drug prices in America are so high (2016)

#187

Post by ddxxdd »

RcouF1uZ4gsC wrote: post #25

This has a very simple fix, and is a fix that would appeal to Donald Trump: Require that pharmaceutical companies do not charge Americans any more for their drugs than what they charge any developed country. This lets other countries do the dirty work of negotiating prices while reaping the benefits for the US. In addition, it goes along with his whole America is getting screwed narrative - ie that other companies ar…

>Require that pharmaceutical companies do not charge Americans any more for their drugs than what they charge any developed country

If i recall correctly, that has been part of Trumps platform for several months before the election.

Or rather, allowing American customers to buy drugs overseas was part of his platform. And i remember that idea went before a congressional vote recently, with both republicans and democrats voting it down.

On mobile, so sorry i cant provide links.

Re: Why drug prices in America are so high (2016)

#188

Post by _Wintermute »

toomuchtodo wrote: post #41
harryh wrote: post #36

Earlier quoted context omitted.

Has the US ever disallowed a patent because the company holding it refused to sell a product to the government at the price the government wanted? It's hard to imagine SCOTUS allowing that sort of thing. The US gov't is subject to its own laws.

Has the US ever fought hard to institute a travel ban in order to prevent people of a certain religion from entering the country, despite judicial intervention. That's the thing about governments: they can do whatever they want. And your recourse is to deal with it or spend years fighting against it (or die in the streets fighting it, lest we forget that option). Disclaimer: I'm for breaking patents when necessary, a…

You're comparing printing simple metal structures from metal powder to synthesizing complex molecules from scratch? I think you might want to brush up on your chemistry before pinning your hopes on 3D printed drugs.

Re: Why drug prices in America are so high (2016)

#189

Post by fleetingmoments »

RcouF1uZ4gsC wrote: post #59
harryh wrote: post #50

Earlier quoted context omitted.

This is not a great fix. Almost all companies (not just drug companies) routinely find ways to segment the market into different groups with different abilities to pay and then charge different prices for very similar products. That is the profit (or future research budget) maximizing strategy. The US is richer. It should be paying more. How much more is debatable.

The US is richer and should be paying more than say Kenya. However, you would be hard-pressed to explain why the US should be paying more than say Denmark or Sweden or Germany?

As a non-US citizen who as been to all the countries in question the answer seems obvious: Their citizens are much unhealthier.

Re: Why drug prices in America are so high (2016)

#190

Post by Thimothy »

chimeracoder wrote: post #149
breatheoften wrote: post #140

Earlier quoted context omitted.

This. It's explicitly capitalistic to be against socializing risk and privatizing profits -- which the is game being played with the current setup of trying to fund drug creation via patent monopolies combined with per unit regulatory pricing games. Academia should be the primary means of drug discovery. Drug manufacturing and distribution _should_ be a commodity business. Anything otherwise and all research on the t…

> Academia should be the primary means of drug discovery. Drug manufacturing and distribution _should_ be a commodity business As mentioned below, the discovery is not the biggest driver of costs. But you should also ask yourself: why is this not already the case? Currently, there's nothing stopping other countries from using taxpayer money to fund drug development locally. Except, by and large, they don't - as menti…

"Currently, there's nothing stopping other countries from using taxpayer money to fund drug development locally. Except, by and large, they don't - as mentioned in the article"

Come on!! Hasn't anybody actually read the article?? Unless the economist is showing different articles to different people the only phrase that mentions research implies that is an argument made by the industry and not clear at all. The "the US subsidizes drug research for the rest of the world" is a huge lie that cannot die soon enough.

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