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this post was submitted on 05 May 2024
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I'm not sure what's worse, the insurance was cut or that a life saving drug is 2.1 million?!
That the insurance was cut. Ethics of private drug R&D aside researching costs resources, resources need to be reimbursed, and if you have a drug that heals a rare illness with one dose you sell very few doses. Another drug for another illness might cost as much to research, but you need a dose every month and there's millions upon millions of patients. Let's also assume that both drugs cost the same to produce, per dose. Which means that to cover total costs a single dose for the first drug might have to cost two millions, and the other 20ct.
The alternative to this is saying "You have a rare illness, tough luck, we won't research drugs for it it benefits too few people".
Places very tightly control the price drugs can be sold for all over the world. They audit the cost of operation, RD, etc and then adjust the price based on a regulated percentage of profit. This means that drug prices, in the rest of the developed world, are far lower than the US. Even in places with non-socialized healthcare like Switzerland, and Japan. Drug companies are still there, still making money, and not increasing drug prices by 1000% because they want to. Then there is the humanitarian practice of subsidizing the cost to patient for exceptionally expensive treatments. For example, the alternative treatment to this drug is more than twice the cost of the drug, it is also less effective, leaving a lot of long term costs. So EU countries, for example, subsidize this drug because it actually ends up saving the tax payers money to do so. This makes it available to the ~1/10000 citizens with the condition, spinal muscular atrophy.
In the US this will likely bankrupt these people, leaving the costs for them and the taxpayer. This ends in a total loss of economic productivity higher than the government just footing the cost for the drug in the first place. The US system is lose/lose. Both the patients and the government pays more than anywhere else. The only people winning here are corporate executives and their shareholders.
That's why I prefaced the whole thing with (more or less)"capitalism aside": Everything you said also applies to drugs which are still overpriced, but definitely cheaper in the US. The reason this kind of drug is especially expensive, also in places not as fucked as the US, is that it's a) a one-dose cure and b) for a rare disease. If it were a monthly injection instead of a one-time one it'd still be as expensive but not per dose but per patient-lifetime, and if twice as many had spinal muscular atrophy it'd be roughly half as expensive.
The bargaining EU insurers do with drug manufacturers takes that into account because, as said, otherwise there'd simply be no drugs for those rare diseases.
Overall I think it'd be better for insurers to fund drug research more directly but also then researching cures for rare illnesses would cost a lot of money per manufactured dose.
I think you missed the point of the second part of my statement. That the government pays for expensive treatments because, in the long run, it actually costs less for them to do so, than to hold the patient liable. This means the cost to patient will never be 2.1 million dollars, which accomplishes the goal of drugs not costing that much where it matters.
The only prescription drugs that are cheaper in the US are off brand generics. This is the case because other options are 3-4 times more expensive, on average, than in the EU, so the increased demand for generics creates a manufacturing scale that drops the prices per unit. This price decrease is 20-30% on average. People in the EU are fine with brand names because they aren't drastically more expensive than generics, even at US generic prices. The end of the day though, they pay less for drugs, as whole, than we do, and no patient is paying 2.1 million dollars for a drug.
If I go to the pharmacy I'll generally get generics, if available, because the insurance is going to give the pharmacist a kickback for finding an option that's below list price. They'll also ask doctors annoying questions if they write a product instead of a drug name (Aspirin instead of ASA / acetylsalicylic acid) on a prescription.
In fact if they didn't do that I'd happily vote for people who'd institute such policies when the next board elections are up.
...that's the economical equation. The legal equation though is that my insurance is required to pay for everything medically necessary, and that might very much be more expensive than not treating me. Health insurance doesn't pay welfare for people with, say, severe but manageable OCD: Unemployable yet not in need of assisted living, incurring no more medical costs than the average person. Yet if a cure were available they'd have to cover it.
The economical equation comes into play when paying for or subsidising stuff from fitness apps to whole holiday retreats which are just a scheme to make you take a nutrition and cooking course and similar things.
Except Zolgensma's R&D was funded through the NiH. The only reason why it costs millions per dose is because Novartis bought AveXis for 8.7 billion solely to acquire the rights to Zolgensma.
[citation needed]?
Wikipedia mentions that it's based on research from the Institut de Myologie, France, nothing about the NiH.
Also I already made the whole capitalism angle an aside. Plenty of people are talking about it, meaning I don't need to talk about it. One-dose cures for rare diseases are more expensive per dose than multi-dose treatments for common diseases under any system, that's what I wanted to say.
I get that y'all yanks hate your medical-industrial complex, and you're right to, but that doesn't mean that everything is expensive just because some suit rolled some dice.
https://www.durbin.senate.gov/imo/media/doc/Senate%20Ltr%20to%20FDA_Zolgensma%20Data%20Issue.pdf
"benefited from comparative studies on patients with spinal muscular atrophy", that's not "funded the R&D" but "NiH did studies and AveXis read them". If it was more than that they wouldn't use that kind of weasel language that only implies, but doesn't say, things. The rest is approval fast-track which saved AveXis money, but didn't cost the tax payer a dime.
I'm not saying that they're not overcharging -- of course they are, they definitely are, especially after getting bought up by Novartis and given the US's inability to actually bargain with drug manufacturers. But this narrative of "taxpayers fronted all the costs" ("R&D was funded through the NiH", implying all of it) is BS.
And even then, and I fucking knew what I was doing when I said "I don't wanna talk about the capitalism aspect", the drug would've still been more expensive to develop, per dose, if it was fully state-funded.
Also I wouldn't be surprised if the French research that led to the whole gene therapy stuff in general was 100x more expensive than those NiH comparative studies. It's foundational research companies never do that kind of stuff. Probably at least 10-20 PhDs in that overall, funded by the French taxpayer.
The cost of the drug. Since the US refuses to socialize Healthcare, people can't afford insurance if companies can charge millions for their dosages, and keep getting higher. My insurance at work covers me, but adding family is already at $800/month. My take home pay (without family insurance) amounts to $2,200 a month.
Companies charging millions for cures in the US means only the wealthy get to be fixed.
Definitely that insurance was cut. Drug R&D is expensive, and they need to pay people who work and have projects that don't pan out. But they should be able to spread that cost over everyone in the pool, reducing the cost to everyone to mere dollars or cents. But that requires insurance to actually fucking do their job.
Drug R&D is expensive, but it's only 21% of the top 15 Pharmaceutical companies' revenue. And that number is actually misleadingly high because it actually includes some actions that are just meant to help advertise the drugs.
Source
I really don't want to defend pharma but that study is a bit dubious.
There's a bunch of issues but the most obvious is simply that a percentage of turnover is meaningless.
What percentage would be right?
Given that they're using the cost of R&D to justify their prices? A lot more than 21%.
The rest of the world gets much lower prices. That's not out of the goodness of their hearts or the generosity of their wallets, yaknow?
You've missed my point.
The percentage of total expenditure spent on R&D is not in any way indicative of the cost of R&D compared to the sale price of a given medication.
Quite simply, maybe the majority of a company's turnover is manufacturing licensed or generic meds. No R&D required.
Does the remaining 21% equate to $2m or $2b, and how many new medications did they create with that expenditure?
That's a mind-numbingly obvious point which completely ignores the context, which is Pharma justifying their high prices based on the amount they spend on R&D.
The rest of the world gets drugs 2-3x cheaper than the US. Do you imagine they're selling at a loss to everywhere else?
Yet completely lost on you ?
If a company spends $2b on research each year and after 5 years brings a new medication to market which is only useful for 1 person in every billion, how much should that company sell that medication for and how is it relevant that the company "only" spent 21% of it's revenue on research? That company could still say that the medication is costly due to research costs and the claim would be true.
I'm not saying pharma companies aren't shady as fuck, I'm just saying that complaining about the percentage of their revenue spent on research is absurd.
The rest of the world gets cheaper medications because the medical system in the US is just a mess.
That said, some medications are still preclusively expensive outside the US "due to research".
Good grief. You don't need to wave your hands so wildly, this is really fucking simple maths. Expenditure which is 21% of the total cannot possibly be the reason why USians pay 2-3 times more than everywhere else for drugs.
Sorry chief. I don't think I can dumb it down any more for you. Good luck with that.
lol
You mean the R&D that the government paid for to take place at a public university, as is the norm? That's the expense you're claiming justifies this profiteering?
Until they start actually paying those subsidies back, that excuse doesn't explain any of their profiteering.
I’m a researcher in the biological sciences at an institute which receives lots of government funding, and was at a university before my current position. We are not being paid to develop drugs. We are being paid to develop new knowledge that hopefully can be useful (in the broad sense of the term). Practically no one I’ve ever met during my time in academia is developing drugs, and the small few that were doing so were only researching a single, small part of a very long, complex process.
The R&D you are paying for is for us to typically find out that “Protein X interacts with Protein Y and causes Effect Z. When we delete Protein X then Effect Z goes away”. We might also find out that “Molecule Q can block the activity of Protein X, but has a host of issues that make it ineffective when given to Petri dish cells and mice.” This can give you a lead towards making a drug, but what we do is basically discover a possible starting point, nothing more. If someone wants to make a drug from this, they typically will start a company and get venture capital and angel investor money, as university labs are usually poorly equipped financially and talent wise to actually develop a drug (to speak nothing of pushing it through clinical trials). Transforming Molecule Q into a bona fide drug candidate is going to require a massive amount of work that most lay individuals are completely unaware of.
I’m really curious where this concept that the government is spending tons of money on drug R&D at publicly funded universities is coming from. It sounds great as a talking point, but from my perspective within the system it’s not quite how things work.
You know that the R in R&D stands for "research", right? 🤦
Sounds a hell of a lot like that's the kind of research that's indispensable when formulating drugs.
Ya think? 🤦
Sounds like you're doing all of the research and other legwork tbh. That's hardly just "a starting point".
You mean other than how you just confirmed it while trying to disprove it?
That being the perspective of living proof that you can be intelligent and simultaneously oblivious of the obvious.
Either way, pharmaceutical companies aren't spending all their income on R&D. By far the biggest expense is advertising and after that, it's stockholder dividends of the absolutely obscene profits they're making on ripping off sick people.
Lol the guy said it himself: “I am a researcher” doesn’t understand there is an entire other part called development that also gets government funding. He works in the field and doesn’t realize that the pharmaceuticals companies “developing” drugs also get grants and tax breaks.
It’s the same for engineering.
The government funds all those small pieces of knowledge through various grants. Some are private, but most are from the government.
Then someone will take those bits of knowledge and assemble them into a new drug. 90% of the boring research is already done.
My employer pays me and my team a lot of money to develop new engineering projects based on these academic papers. Everything is cited, and normally the grad students are ecstatic to be named as contributing work. Their names don’t show up on the design patent, but if someone digs into it they can see all the work that contributed.
You might not see it at your level, and I am truly sorry for that because you deserve credit for your work.
It comes from reality
The Institut de Myologie in France is a nonprofit org that funds itself mostly from a yearly telethon and government funding... This would be you
The Nationwide Children's Hospital is a nationally ranked pediatric acute care teaching hospital located in the Southern Orchards neighborhood of Columbus, Ohio. The hospital has 673 pediatric beds and is affiliated with the Ohio State University College of Medicine
See? At least in part, the money for the start up that D the drug, based on the R France publicly provides, came from the Ohio State University which also receives public funding
As always with Capitalism... Socialise the costs, privatize the profits
This isn't what my understanding of how the system works, but the way you word it, you seem very confident that it is. I'm honestly curious what you read that lead you to this perspective.
This study should be a decent starting point.