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Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

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Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#71

Post by 1024core »

gaius wrote: post #12
empath75 wrote: post #4

The answer is that our insurance and medical billing system is a complete tirefire and needs to be burned to the ground and replaced with something sane.

If the pill retailed for $0.04 in the US could the R&D be recouped? Americans should feel good about high drug prices: that's your aid to the Third World right there. Not the most efficient technique but still better than not doing it at all.

> If the pill retailed for $0.04 in the US could the R&D be recouped?

The same tired old and wrong argument. The article clearly states that the patent expired decades ago. So why not read the article and see that this old excuse is WRONG ?

What do you stand to gain by putting out these lies? What will it take for idiots like you to stop doing so??

[Note to "dang" or any other mod: yes, I called this person an idiot. I was trying to be restrained. I am tired of people making excuses for the greed of pharma companies. They always use "recoup R&D costs" as an excuse for price gouging, and killing people.]

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#72

Post by barry-cotter »

harryh wrote: post #15
gaius wrote: post #12

Earlier quoted context omitted.

If the pill retailed for $0.04 in the US could the R&D be recouped? Americans should feel good about high drug prices: that's your aid to the Third World right there. Not the most efficient technique but still better than not doing it at all.

While in general I agree with you that is not the case here. The drug's patent expired decades ago. The issue is that there is only 1 US manufacturer giving them pricing power. It's unclear to me why another drug manufacturer doesn't come in and undercut the price. This is what happens in most other industries. My gut suspects the arduous FDA approval process, but I have no real evidence for this hypothesis.

You are correct. The FDA is insanely parochial. They won’t allow importation of generics approved by their European, Canadian or Japanese equivalents of generics with decades of use. The only reason Martin Shrkeli was able to jack up the price of the drug he did, a generic, is because the FDA won’t white label or fast track drugs from other jurisdictions.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#73

Post by bufferoverflow »

huherto wrote: post #62
bufferoverflow wrote: post #22

Earlier quoted context omitted.

Typical socialist answer. Burn a working system to the ground, so everyone suffers equally. At the very least the current system allows poor countries to enjoy cheap excellent drugs, researched and paid for by the wealthy western countries.

No one is really really suggesting to burn it down. It is just an expression of how frustrated we are becoming with a system that is not working out. It is hurting us. It is hurting the country.

The comment I replied to said

"needs to be burned to the ground".

And now you're telling me no one really suggested it.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#74

Post by sol_remmy »

FLUX-YOU wrote: post #48
geekamongus wrote: post #29

Earlier quoted context omitted.

The answer is that we buy health insurance, not health care.

The problem is that insurance costs continue to rise for no real reason. They even made costs rise when more people were insured because of ACA. In what world does that make sense?

> They even made costs rise when more people were insured because of ACA. In what world does that make sense?

I'm surprised you don't remember the reason because it was in the news 24/7. It's because insurance costs 10X for sick people (because they also draw 10X in insurance), those sick people could not afford their insurance, and the ACA gave those uninsured sick people deeply subsidized insurance, raising the average cost to insurance companies of each insured person

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#76

Post by yequalsx »

notyourday wrote: post #51
yequalsx wrote: post #39

Earlier quoted context omitted.

Not if there is collusion or cartel pricing. There are also regulatory means of limiting competition. The basic economics notion works in a market that is mostly free. I suspect that most things related to the American health care system do not qualify as a free market.

There's no cartel pricing in medicine. If there was there would be a competing cartel as it is the case everywhere . The reality is that companies that make generics are simply too small to be able to compete with Pfizer, Merc, Glaxo etc and for all big talk our scientists in R&D and FDA are bought and sold like trading cards and their opinions change with the opinions of their owners, which is, for example, why FDA…

Your view of economics does not match reality.

A survey of hundreds of published economic studies and legal decisions of antitrust authorities found that the median price increase achieved by cartels in the last 200 years is about 23%.[1] Private international cartels (those with participants from two or more nations) had an average price increase of 28%, whereas domestic cartels averaged 18%. Less than 10% of all cartels in the sample failed to raise market prices.

Cartels do exist and do not always have a competing cartel. Especially if the cost to entry is too great for a competing cartel to get started. There is also the fact that competition doesn’t just instantly occur. There is a lag in the market and during the lag cartel pricing occurs.

It’s not some immutable law of the universe that completion always springs up in economics. This isn’t always the case and it isn’t always the case that a cartel, oligopoly, or monopoly will instantly lose its pricing power simply because a new player arrives. Sometimes the new player gets absorbed, or becomes part of the cartel.

Quote above from

https://en.m.wikipedia.org/wiki/Cartel

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#77

Post by Symmetry »

justin66 wrote: post #31
harryh wrote: post #15

Earlier quoted context omitted.

While in general I agree with you that is not the case here. The drug's patent expired decades ago. The issue is that there is only 1 US manufacturer giving them pricing power. It's unclear to me why another drug manufacturer doesn't come in and undercut the price. This is what happens in most other industries. My gut suspects the arduous FDA approval process, but I have no real evidence for this hypothesis.

> It's unclear to me why another drug manufacturer doesn't come in and undercut the price. From the sound of things these diseases were until very recently isolated to poorer countries. Even today, with the increased number of cases, there might not be enough money to be made based on a few sick North Americans to justify tooling up to make a new drug. (Some of that is about FDA regulatory approval, but not much sinc…

That explains it with this drug but wouldn't explain why the US just as EpiPen as our one adrenaline injector (in practice) with a single manufacturer while there are a half dozen competing manufacturers.

And if the FDA recognized that Europeans aren't particularly dying off from poor quality medicine and maybe we should allow import of EMA accepted drugs then maybe economies of scale would be less of a problem.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#78

Post by jacquesm »

harryh wrote: post #46
gizmo wrote: post #21

Earlier quoted context omitted.

Because there is no price the competitor can charge that the original supplier can't match. There is no profit to be made, unless there is only a single manufacturer. Also, it's difficult to acquire approval needed from the FDA to demonstrate the new drug is safe and equivalent to the already approved because the original producer won't cooperate and provide relevant samples to their competition so they can demonstra…

Because there is no price the competitor can charge that the original supplier can't match. This is a commonly cited reason but I don't buy it. They're selling these things for 4 cents in tanzania so we're talking about something that is practically free to make. There are lots of things that cheap where we see competition in the US: paperclips, reams of paper, chewing gum, whatever. Why is there competition for thes…

At a guess because then that other manufacturer would undercut the first manufacturers cash cows. In other words: it could easily be a cartel of sorts with some regulatory capture thrown in to ensure the cake stays divided between entrenched parties.

Situations like these should count as evidence that something isn't quite as it should be.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#79

Post by maxxxxx »

gaius wrote: post #12
empath75 wrote: post #4

The answer is that our insurance and medical billing system is a complete tirefire and needs to be burned to the ground and replaced with something sane.

If the pill retailed for $0.04 in the US could the R&D be recouped? Americans should feel good about high drug prices: that's your aid to the Third World right there. Not the most efficient technique but still better than not doing it at all.

This often repeated line about the high drug prices in the US being a good thing because it subsidizes R&D for the rest of the world sounds like very self serving propaganda by pharmaceutical companies. I don't believe it a single second.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#80

Post by Symmetry »

edko wrote: post #56
harryh wrote: post #46

Earlier quoted context omitted.

Because there is no price the competitor can charge that the original supplier can't match. This is a commonly cited reason but I don't buy it. They're selling these things for 4 cents in tanzania so we're talking about something that is practically free to make. There are lots of things that cheap where we see competition in the US: paperclips, reams of paper, chewing gum, whatever. Why is there competition for thes…

Maybe the market in the US isn't big enough to recover the fixed costs. How many pills at 4 cents would they have to sell?

If fixed prices inherent to the production of the drug were the key then I wouldn't expect a manufacturer would be able to provide this same drug in the UK for $2 without going out of business. Now, there are probably reasonable health and safety procedures done in the UK but not in Tanzania that bump the price up that much which I want done to my drugs as a wealthy resident of the first world but which I might not be able to afford if I were a Tanzanian. But $400 is clearly not required to make the drug up to reasonable safety standards.
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