Cost of medicines

Listen troll. This issue has been brought up and beaten to death. If you are so ignorant to think
that the cost of pills should only be based on the cost of active ingredients then you probably are
not intelligent enough to discuss the issue in its entirety.

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

So I imagine if you have an attorney that charges you a couple thousand dollars for his/her services
and he/she only uses $2.00 worth of paper and a $1.00 worth of stamps they should charge you for
their services based on the cost of the supplies used rather than the going rate? What your really
paying for is knowledge and it isn't much different with prescription drugs. You are paying for the
millions of dollars it took for the drug company to come up with a drug not for the manufacturing
costs of the drugs.

If you were stuck in the middle of nowhere, it's raining and your car died and you needed to get
somewhere would you be willing to pay $50 for somebody to fix your car? Most likely yes. But what if
when the person arrived they knew from previous experience that all they had to do was push a reset
button on your fuel pump safety switch and it takes all of 30 seconds to get you on the road again.
Well that is $100 a minute and $6000 dollars an hour. What a ripoff!!! Now all of a sudden your
[censored] and feel like you got taken. You didn't get taken. You got your car fixed and you sure as
hell couldn't do it. There is no difference with RX drugs. You can't make them and so you need to
buy them at whatever the going price is.

As far as you [censored] about how in this particular example the generic, although cheaper and saving
you more money than purchasing brand name, should have been cheaper still because the pharmacy
didn't pay as much for the generic as it did in relation to the brand name, your ridiculous.

If everybody sold things for what they cost they nobody would be in business because who is
going to pay for the pharmacist salary, the techs salary, computers, phones, long distance
bills, paper supplies, pens, space lease, electricity, renewal fees for licensing, etc. Somebody
has to pay for it.

And your list isn't exactly correct. The Prilosec and Claritin is now OTC and much cheaper than you
have listed.

If you want to go to Costco to buy your meds then do so, get off your soap box and take your issue
up via a different venue.

CaptainKrunch

"Edward Elliott" <[email hidden]> wrote in message "]news:[email hidden]...

Quoted message said:

Cost of Medicines

Did you ever wonder how much it costs a drug company for the active Ingredient in prescription
medications? Some people think it must cost a lot, since many drugs sell for more than $2.00 per
tablet. We did a search of offshore chemical synthesizers that supply the active ingredients found
in drugs approved by the FDA. As we have revealed in past issues of Life Extension, a significant
percentage of drugs sold in the United States contain active ingredients made in other countries.

In our independent investigation of how much profit drug companies really make, we obtained the
actual price of active ingredients used in some of the most popular drugs sold in America. The
chart below speaks for itself.

Celebrex 100 mg Consumer price (100 tablets): $130.27 Cost of general active ingredients: $0.60
Percent markup: 21,712%

Claritin 10 mg Consumer Price (100 tablets): $215.17 Cost of general active ingredients: $0.71
Percent markup: 30,306%

Keflex 250 mg Consumer Price (100 tablets): $157.39 Cost of general active ingredients: $1.88
Percent markup: 8,372%

Lipitor 20 mg Consumer Price (100 tablets): $272.37 Cost of general active ingredients: $5.80
Percent markup: 4,696%

Norvasc 10 mg Consumer price (100 tablets): $188.29 Cost of general active ingredients: $0.14
Percent markup: 134,493%

Paxil 20 mg Consumer price (100 tablets): $220.27 Cost of general active ingredients: $7.60
Percent markup: 2,898%

Prevacid 30 mg Consumer price (100 tablets): $44.77 Cost of general active ingredients: $1.01
Percent markup: 34,136%

Prilosec 20 mg Consumer price (100 tablets): $360.97 Cost of general active ingredients $0.52
Percent markup: 69,417%

Prozac 20 mg Consumer price (100 tablets) : $247.47 Cost of general active ingredients: $0.11
Percent markup: 224,973%

Tenormin 50 mg Consumer price (100 tablets): $104.47 Cost of general active ingredients: $0.13
Percent markup: 80,362%

Vasotec 10 mg Consumer price (100 tablets): $102.37 Cost of general active ingredients: $0.20
Percent markup: 51,185

Xanax 1 mg Consumer price (100 tablets) : $136.79 Cost of general active ingredients: $0.024
Percent markup: 569,958%

Zestril 20 mg Consumer price (100 tablets) $89.89 Cost of general active ingredients $3.20 Percent
markup: 2,809%

Zithromax 600 mg Consumer price (100 tablets): $1,482.19 Cost of general active ingredients:
$18.78 Percent markup: 7,892%

Zocor 40 mg Consumer price (100 tablets): $350.27 Cost of general active ingredients: $8.63
Percent markup: 4,059%

Zoloft 50 mg Consumer price: $206.87 Cost of general active ingredients: $1.75 Percent
markup: 11,821%

Since the cost of prescription drugs is so outrageous, I thought everyone I knew should know about
this. Please read the following and pass it on. It pays to shop around. This helps to solve the
mystery as to why they can afford to put a Walgreens on every corner.

On Monday night, Steve Wilson, an investigative reporter for channel 7 News in Detroit, did a
story on generic drug price gouging by pharmacies. He found in his investigation, that some of
these generic drugs were marked up as much as 3,000% or more. Yes, that's not a typo.....three
thousand percent!

So often, we blame the drug companies for the high cost of drugs, and usually rightfully so. But
in this case, the fault clearly lies with the pharmacies themselves. For example, if you had to
buy a prescription drug, and bought the name brand, you might pay $100 for 100 pills. The
pharmacist might tell you that if you get the generic equivalent, they would only cost $80, making
you think you are "saving" $20. What the pharmacist is not telling you is that those 100 generic
pills may have only cost him $10!

At the end of the report, one of the anchors asked Mr. Wilson whether or not there were any
pharmacies that did not adhere to this practice, and he said that Costco consistently charged
little over their cost for the generic drugs. I went to the Costco site, where you can look up any
drug, and get its online price. It says that the in-store prices are consistent with the online
prices. I was appalled.

Just to give you one example from my own experience, I had to use the drug, Compazine, which helps
prevent nausea in chemo patients. I used the generic equivalent, which cost $54.99 for 60 pills at
CVS. I checked the price at Costco, and I could have bought 100 pills for $19.89. For 145 of my
pain pills, I paid $72.57. I could have got 150 at Costco for $28.08. I would like to mention,
that although Costco is a "membership" type store, you do NOT have to be a member to buy
prescriptions there, as it is a federally regulated substance. You just tell them at the door that
you wish to use the pharmacy, and they will let you in (this is true, I went there this past
Thursday and asked them.)

I am asking each of you to please help me by copying this letter, and pasting it into your own
email, and send it to everyone you know with an email address.

Sharon L. Davis Budget Analyst U.S. Department of Commerce Room 6839 Office Ph: 202-482-4458
Office Fax: 202-482-5480 Email Address: [email hidden]

Mary Palmer Budget Analyst Bureau of Economic Analysis Office of Budget & Finance Voice: (202) 606-
9295 Fax: (202) 606-5324

Edward Elliott said:

Cost of Medicines

Ever heard of this little expensive and highly risky thing called R&D?

"CaptainKrunch" <[email hidden]> ha scritto nel messaggio
"]news:[email hidden]...

Quoted message said:

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

However drugs in United States are very expensive. Almost all medication, not generic, which appears
in list, in Italy has a price between one third and one half of United States one. In some cases is
terrible, for example here 28 Prozac tablets has a cost of 14 ?, while the difference is so slight
for beta-blockers. Maybe you should buy medication in Italy :-)

Quoted message said:

Quoted message said:

Cost of Medicines

Ever heard of this little expensive and highly risky thing called R&D?

I'll assume at least some of us are in R&D and realize that drug prices could be cut in half and
still put big bucks in our bosses pockets. Now, lets talk about the poor guys that provide made-to-
order precursors, play a role in R&D and never reap the benefit.

Quoted message said:

Quoted message said:

Quoted message said:

Cost of Medicines

Ever heard of this little expensive and highly risky thing called R&D?

...risk is also declining with HTS and on-site specialties (e.g., crystallographers).

Quoted message said:

I'll assume at least some of us are in R&D and realize that drug prices could be cut in half and
still put big bucks in our bosses pockets. Now, lets talk about the poor guys that provide made-to-
order precursors, play a role in R&D and never reap the benefit.

"Edward Elliott" <[email hidden]> wrote in message
"]news:[email hidden]...

Quoted message said:

Cost of Medicines ".....We did a search of offshore chemical synthesizers that supply the active
ingredients found in drugs approved by the FDA. As we have revealed in past issues of Life
Extension, a significant percentage of drugs sold in the United States contain active ingredients
made in other

countries."

Many offshore chemical companies manufacture pharmaceutical ingredients. Many of these companies are
NOT approved by the FDA as suppliers to US pharmaceutical companies. I assume you are talking about
approved companies.

"......we obtained the actual price of active

Quoted message said:

ingredients used in some of the most popular drugs sold in America. The chart below speaks for
itself."

Quoted message said:

Celebrex 100 mg Consumer price (100 tablets): $130.27 Cost of general active ingredients: $0.60
Percent markup: 21,712% "

You state the cost of ingredients as the cost per 100 tablets in order to come up with your figure.
If this is the case (0.6 cents per unit - I doubt it), then those [censored] overseas have been raking
us over the coals. After all, if they can sell it to us for $0.60, then it must cost them between
one and two cents. $0.60 per capsule seems more like it. If you understand how business operates,
you know that no organization can afford to stay in business and not make a realistic profit

You paint a very simplistic view of this complicated picture. Beside the obvious costs of Research
and Development, alluded to by Andrew White, there are many activities within a pharmaceutical
company which must come together, before the tablets/capsules start rolling off of the presses. Add
to that the many support activities, which are ongoing, you wind up with a comprehensive
organization, consisting of many indiduals.

Don't forget the distribution channels at the wholesale and retail levels. Each organization adds
its cost of operation to the total picture. And yes, having that bottle of tablets on the pharmacy
shelf conveys a cost, albeit an invisible one.

Would you deny the workers at every level a good living? Would you deny the corporation a profit on
top of its cost of operating? Or, would you suggest sending our jobs overseas to reduce cost? Hey,
come to think of it, maybe some public sector jobs should be sent there as well.

HankG

---
Outgoing mail is certified Virus Free. Checked by AVG anti-virus system (grisoft.comgrisoft.comOpen ↗).
Version: 6.0.587 / Virus Database: 371 - Release Date: 2/12/2004

HankG said:

"Edward Elliott" <[email hidden]> wrote in message "]news:[email hidden]...

Quoted message said:

Cost of Medicines

I have looked at this question in some detail, and I must say that I'm no closer to a position one
way or the other. On one hand, the high costs are a tremendous burden on individuals and the health
care system and insurers. On the other hand, I'd hate to think what would happen if we killed the
golden goose that funds research. Clearly a manufacturer selling substitute generic formulations for
a fraction of the original manufactures price is not in a position to pour huge amounts of money
into R&D. I don't know the answer, and could argue both positions.

Edward Elliott said:

Did you ever wonder how much it costs a drug company for the active Ingredient in prescription
medications?

No, because it's irrelevant. Trying to compare the retail price of a drug with the wholesale cost of
its raw materials is assinine. You might was well accuse software companies of ripping you off,
since CD-ROMs cost only pennies to burn.

"CaptainKrunch" <[email hidden]> wrote in
:"]news:[email hidden]:

Quoted message said:

Listen troll. This issue has been brought up and beaten to death. If you are so ignorant to think
that the cost of pills should only be based on the cost of active ingredients then you probably
are not intelligent enough to discuss the issue in its entirety.

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

And people who defend the pharmaceutical companies conveniently leave out the taxpayer supported
funds and research facilities and universities that are used in the development of drugs. The
pharmaceutical industry is heavily subsidized, but they try to make people believe that they foot
the entire bill for drug research.

--
Dan Solomon

Daniel Solomon said:

"CaptainKrunch" <[email hidden]> wrote in :"]news:[email hidden]:

Quoted message said:

Listen troll. This issue has been brought up and beaten to death. If you are so ignorant to think
that the cost of pills should only be based on the cost of active ingredients then you probably
are not intelligent enough to discuss the issue in its entirety.

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

And people who defend the pharmaceutical companies conveniently leave out the taxpayer supported
funds and research facilities and universities that are used in the development of drugs. The
pharmaceutical industry is heavily subsidized, but they try to make people believe that they foot
the entire bill for drug research.

--
Dan Solomon

Maybe so. But subsidies are used in many industries. The point is, if the subsidies were
removed the cost of the drugs would be higher. And please don't start any nonsense like they
make enough already, etc. Last I checked business was business and I don't recall any socialist
revolution recently.

In article <[email hidden]>, Daniel Solomon <[email hidden]>
wrote: for approval.

Quoted message said:

And people who defend the pharmaceutical companies conveniently leave out the taxpayer supported
funds and research facilities and universities that are used in the development of drugs. The
pharmaceutical industry is heavily subsidized, but they try to make people believe that they foot
the entire bill for drug research.

Of course, the ENTIRE NIH research budget is less than half of the money paid by pharms and this
includes many studies that have nothing to do with pharm company's needs (indeed they do much of
the old drug vs new drug comparisons).

Daniel Solomon <[email hidden]> wrote in message news:<[email hidden]>...

Quoted message said:

"CaptainKrunch" <[email hidden]> wrote in :"]news:[email hidden]:

Quoted message said:

Listen troll. This issue has been brought up and beaten to death. If you are so ignorant to
think that the cost of pills should only be based on the cost of active ingredients then you
probably are not intelligent enough to discuss the issue in its entirety.

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

And people who defend the pharmaceutical companies conveniently leave out the taxpayer supported
funds and research facilities and universities that are used in the development of drugs.

This is a commonly trotted out factoid though I have yet to see specific evidence that the
participation by NIH and/or university medical centers in the drug research process is altruistic.
There are shared programs between the public and private sectors that are funded on a shared basis.
The ownership of the outcomes of the research is shared as well. The benefit of these endeavors
accrues to the patient and to the creators (royalties, patents, etc.), and ultimately to patients,
so the taxpayer does benefit.

Quoted message said:

The pharmaceutical industry is heavily subsidized, but they try to make people believe that they
foot the entire bill for drug research.

I haven't seen a single subsidy paid to the pharmaceutical industry. The accounting costs ae handled
the same as with any business, the tax incentives to do research are intended to promote a valuable
activity and are available to any research intensive company. What "heavily subsidized" examples can
you share? Specifics would be nice - preferably from credible sources, not Time magazine.

js

In article <[email hidden]>,

Edward Elliott said:

Did you ever wonder how much it costs a drug company for the active Ingredient in prescription
medications? Some people think it must cost a lot

Nope. The drug industry's products are much like those in the entertainment industry: the costs of
developing a product (the "fixed costs"😉 are high, while the costs of making new copies of the
product (the "marginal costs"😉 are low.

This sort of product, when put in a market of consumers that have very widely ranging abilities or
desires to pay for it, gives a very strong incentive to price discrimination. Setting a uniform
price for goods may make your market too small or too low-margin to earn a profit. On the other
hand, if you can charge differently based on expected ability to pay, you can make money all around.
In this case, the American market represents the high-paying customers, who effectively cover the
fixed costs, whereas the foreign markets, who pay less, still cover the lower marginal costs, so
drug makers are able to profit from both kinds of market. But if you're a middle-class American
consumer, the burden of paying for the drug falls largely on you.

The other thing you tend to see in this kind of market is a strong push towards government-sponsored
monopolies. (Without monopolies, competitors tend to discourage developing new products involving
high fixed costs, and also tend to undercut price discrimination.) In the drug industry, that
monopoly is granted in the form of patents; in the entertainment industry, it comes as copyright. In
both cases, some degree of monopoly protection is a good thing (since it helps innovators recover
their fixed costs, giving an incentive to create new products that otherwise would not exist). But
it can also be taken too far, to the detriment of consumers. (And the producers have incentives to
extend this monopoly power as far as they can.) Monopoly enforcement can be more of a problem, both
for manufacturers and consumers, when consumers find ways around the price discrimination vendors
have set up (such as by buying drugs abroad, or using P2P networks to get copies of movies or
recorded music). Producers see an erosion of their markets; consumers see erosions of their freedoms
as pressure is imposed to restore the pre-existing markets.

Here are some things consumers who are suffering under the current drug market can do:

-- Buy generic when you can. Generic drugs are those for which monopoly protection has expired,
so they're much more competitively priced than patented drugs. And in the US, their preparation
is also closely regulated, so you'll usually get a product that's indistinguishable from the
brand name.

-- Encourage your doctor to consider drugs that are already in the public domain (and can thus be
generic) as well as new drugs.

Doctors are subject to a lot of marketing for patented drugs (which patients also pay for when
they buy those drugs), and older proven remedies may get short shrift as a result. While in
many cases new drugs really are the best ones to use, often they have little or no real
advantage for many patients over older remedies that are in the public domain. (Most drugs
marketed before the mid-1980s are now in the public domain.) Moreover, many of these older
drugs have a longer track record of studies showing their safety and effectiveness. And you'll
often pay a lot less for them.

If you can't afford the newer drugs, it's particularly important to consider alternatives.
There's no point in getting a prescription for a new drug that gets rid of 90% of your problem
if you can't afford to have it filled, when you could pay for a cheaper drug that takes care of
80% of the problem.

-- Encourage your legislators to make and maintain reasonable patent laws. Often they only hear
from industry lobbyists, who have an understandably one-sided agenda on the issue. (In related
monopoly legislation, the entertainment industry has severely unbalanced copyright law in recent
years, for instance.) Special sweetheart patent extensions, which occasionally make it through
Congress, should be resisted, as should wholesale expansion of patent terms or powers.

-- Encourage both government and drug companies to make special arrangements to provide drugs that
are particularly crucial to patients who can't afford them at normal retail. If there's going to
be price discrimination in the patented market, it can also be used for good purposes. If drugs go
to the people who really couldn't get them any other way, at prices not much higher than the
marginal costs, then everyone can benefit: more people get the treatment they need, and the drug
companies still make money.

John Mark Ockerbloom

Jonathan Smith said:

Daniel Solomon <[email hidden]> wrote in message
news:<[email hidden]>...

Quoted message said:

"CaptainKrunch" <[email hidden]> wrote in :"]news:[email hidden]:

Quoted message said:

Listen troll. Specifics would be nice -

preferably from credible sources, not Time magazine.

js

More likely Guns & Ammo or Redneck Hotrodding.

[email hidden] (John Ockerbloom) wrote in message news:<[email hidden]>...

Quoted message said:

In article said:

Did you ever wonder how much it costs a drug company for the active Ingredient in prescription
medications? Some people think it must cost a lot

Nope. The drug industry's products are much like those in the entertainment industry: the costs of
developing a product (the "fixed costs"😉 are high, while the costs of making new copies of the
product (the "marginal costs"😉 are low.

This sort of product, when put in a market of consumers that have very widely ranging abilities or
desires to pay for it, gives a very strong incentive to price discrimination.

Which, according to economic models, provides the greatest societal value.

Quoted message said:

Setting a uniform price for goods may make your market too small or too low-margin to earn a
profit. On the other hand, if you can charge differently based on expected ability to pay,

willingness, not ability?

Quoted message said:

you can make money all around. In this case, the American market represents the high-paying
customers,

How do you know this is true? You just suggested that price discrimination is an objective and now
you take 50 or 60 percent of the world market for pharmaceuticals and call it a single market?
Hardly evidence of effective price discrimination. Perhaps you'd like to revisit that comment. Is
the US a single price market?

Quoted message said:

who effectively cover the fixed costs, whereas the foreign markets, who pay less, still cover the
lower marginal costs, so drug makers are able to profit from both kinds of market.

Are you implying that all foreign markets pay less and equally less than all US markets? I would
argue that this is not true at all.

One of the largest "fixed" costs is the FDA. That is uniquely American. No question that there are
regulatory agencies elsewhere but then again, once you have the FDA ok, licensure requirements are
likely marginal in cost elsewhere.

Quoted message said:

But if you're a middle-class American consumer, the burden of paying for the drug falls
largely on you.

If you are one of the 85% of US consumers with health/drug insurance, the cost of medications falls
on your insurer. Are US insurers not equally as good negotiators as European governments?

Quoted message said:

The other thing you tend to see in this kind of market is a strong push towards government-
sponsored monopolies. (Without monopolies, competitors tend to discourage developing new products
involving high fixed costs, and also tend to undercut price discrimination.) In the drug industry,
that monopoly is granted in the form of patents; in the entertainment industry, it comes as
copyright. In both cases, some degree of monopoly protection is a good thing (since it helps
innovators recover their fixed costs, giving an incentive to create new products that otherwise
would not exist). But it can also be taken too far, to the detriment of consumers. (And the
producers have incentives to extend this monopoly power as far as they can.)

You should consider the actual patent life and the effective patent life arguments. The effective
patent life is measured in months in the pharmaceutical industry. Competition is therapeutic based,
not chemical based. The instability indices attest to this dynamic. The advantage of monopolistic
competition (this is a bonafide economics term) in terms of market behavior is in its ability to
support innovative competition while still maintaing a certain level of price competition.
Considering that penicillin doesn't work a third of the time or more, it sure is nice to have
macrolides and cephlasporins don't you think?

Quoted message said:

Monopoly enforcement can be more of a problem, both for manufacturers and consumers, when
consumers find ways around the price discrimination

You've confused some terms, here, I think. Your suggestion of "enforcement" of monopoly (this would
be patent protection) and the "ways around price discrimination" (this would be arbitrage) are not
interchangeable. For example, in the EU, parallel imports often are the mechanism by which
distributors finese the price discrimination issue - but it is hardly a patent concern.

Quoted message said:

vendors have set up (such as by buying drugs abroad, or using P2P networks to get copies of movies
or recorded music). Producers see an erosion of their markets; consumers see erosions of their
freedoms as pressure is imposed to restore the pre-existing markets.

Your drug example is one of arbitrage, your music example is one of trademark/copyright
infringement. These are not the same.

Quoted message said:

Here are some things consumers who are suffering under the current drug market can do:

-- Buy generic when you can. Generic drugs are those for which monopoly protection has expired,
so they're much more competitively priced than patented drugs. And in the US, their preparation
is also closely regulated, so you'll usually get a product that's indistinguishable from the
brand name.

Some have argued brand loyalty and quality but for the general case, this is an effective way of
managing drug costs. It is unfortunate that this competitiveness in the US market is not better
publicized.

Quoted message said:

-- Encourage your doctor to consider drugs that are already in the public domain (and can thus
be generic) as well as new drugs.

No drugs are "in the public domain" per se. The only drugs that cannot bve patented are ones derived
from "plant" products - though there are some real technical issues here.

Quoted message said:

Doctors are subject to a lot of marketing for patented drugs (which patients also pay for
when they buy those drugs), and older proven remedies may get short shrift as a result. While
in many cases new drugs really are the best ones to use, often they have little or no real
advantage for many patients over older remedies that are in the public domain.

What you describe here is what I was referring to earlier. The competition is not at the molecule
level but at the therapeutic level. Your observation that some newer drugs provide only
incremental benefits is a valid one. However, some of these benefits have more than incremental
value in some patients. For example, there is an argument in support of diuretics rather than ACE
inhibitors in the treatment of hypertension. The unfortunate thing is that control on diuretics
alone is short lived.

Quoted message said:

(Most drugs marketed before the mid-1980s are now in the public domain.) Moreover, many of
these older drugs have a longer track record of studies showing their safety and
effectiveness. And you'll often pay a lot less for them.

And they also have serious side effects along with marginal efficacy. But, then again, the choice is
left to the patient and doctor.

Quoted message said:

If you can't afford the newer drugs, it's particularly important to consider alternatives.
There's no point in getting a prescription for a new drug that gets rid of 90% of your
problem if you can't afford to have it filled, when you could pay for a cheaper drug that
takes care of 80% of the problem.

Or you can have your physician contact the manufacturer. According to the PMA, many companies have
programs for low income (seniors?) to get the drugs they need at a cost they can afford.

Quoted message said:

-- Encourage your legislators to make and maintain reasonable patent laws. Often they only hear
from industry lobbyists, who have an understandably one-sided agenda on the issue.

There is no rreason why patent laws should be tailored to specific industries. Considering the
length of time a drug spends in development and not on the market, I don't think patent protection
is a concern for consumers.

Quoted message said:

(In related monopoly legislation, the entertainment industry has severely unbalanced copyright law
in recent years, for instance.) Special sweetheart patent extensions, which occasionally make it
through Congress, should be resisted, as should wholesale expansion of patent terms or powers.

patents are an effective public policy tool. Two examples: In an effort to promote the User Fee Act,
Congress allowed patent extension of regulatory delays. In order to promote research in diseases
with small economic value, the Congress implemented the Orphan Drug Act. In an effort to promote
research of adult drugs for use in kids, the Congress provided for patent extensions for pediatric
reesearch.

Quoted message said:

-- Encourage both government and drug companies to make special arrangements to provide drugs
that are particularly crucial to patients who can't afford them at normal retail. If there's
going to be price discrimination in the patented market, it can also be used for good purposes.
If drugs go to the people who really couldn't get them any other way, at prices not much higher
than the marginal costs, then everyone can benefit: more people get the treatment they need, and
the drug companies still make money.

This is an interesting comment. I remember a year or three ago companies were being challenged to
provide South Africa with low cost HIV drugs. In response, a number of these companies priced these
drugs at manufacturers cost. Rather than applauding this effort, the response from Sidney Wolf at
Public Citizen was that they were still too expensive and if they could afford to sell them so cheap
in Africa they should sell them at theat price in the US, too.

John - drug development and computer science had a lot less in common than you might think.

js

In article <[email hidden]>,

(Jonathan Smith) said:

If you are one of the 85% of US consumers with health/drug insurance, the cost of medications falls
on your insurer. Are US insurers not equally as good negotiators as European governments?

It has nothing to do with negotiating ability. In most Euro areas (and Canada) the governments
don't negotiate prices. They SET them. The governments are what the econ-types call monopsonists,
or monopolistic buyers for ease of understanding. In Canada, for instance, the government
sometimes doesn't even tell pharm companies what they can charge for a new med until a few months
AFTER it is out. Thus, pharm companies, if they guess wrong on the formula, have to give back
"overcharges". Don't know of a US Insurer that can do either.

Quoted message said:

You should consider the actual patent life and the effective patent life arguments. The effective
patent life is measured in months in the pharmaceutical industry. Competition is therapeutic based,
not chemical based. The instability indices attest to this dynamic. The advantage of monopolistic
competition (this is a bonafide economics term) in terms of market behavior is in its ability to
support innovative competition while still maintaing a certain level of price competition.
Considering that penicillin doesn't work a third of the time or more, it sure is nice to have
macrolides and cephlasporins don't you think?

And there are any number of other cases where first-in-class meds get
supplanted by follow ons that have been tweaked for different side effects or

instance, over the next few quarters.

Quoted message said:

What you describe here is what I was referring to earlier. The competition is not at the molecule
level but at the therapeutic level. Your observation that some newer drugs provide only
incremental benefits is a valid one. However, some of these benefits have more than incremental
value in some patients. For example, there is an argument in support of diuretics rather than ACE
inhibitors in the treatment of hypertension. The unfortunate thing is that control on diuretics
alone is short lived.

There are also many instances where medications of the same class just plain don't work the
same at the individual level. For instance, it is well established that a person may not
respond to one antidepressant (say Prozac) but will for a different member of the same class
(say Zoloft). Many other kinds and types of medications have been shown to work in the same
strange way. Personally, I am beginning to think that "Me-too" drug may not be a viable
discussion point any more.

talkback said:

Daniel Solomon said:

"CaptainKrunch" <[email hidden]> wrote in :"]news:[email hidden]:

Quoted message said:

Listen troll. This issue has been brought up and beaten to death. If you are so ignorant to think
that the cost of pills should only be based on the cost of active ingredients then you probably
are not intelligent enough to discuss the issue in its entirety.

Although I agree some drug prices seem ridiculous you conveniently have left out the millions of
dollars the drug companies have spent in trying to bring that drug to market. This includes
probably hundreds of different drugs created and tested just to get one drug to pass the FDA
standards for approval.

And people who defend the pharmaceutical companies conveniently leave out the taxpayer supported
funds and research facilities and universities that are used in the development of drugs. The
pharmaceutical industry is heavily subsidized, but they try to make people believe that they foot
the entire bill for drug research.

--
Dan Solomon

Maybe so. But subsidies are used in many industries. The point is, if the subsidies were removed
the cost of the drugs would be higher. And please don't start any nonsense like they make enough
already, etc. Last I checked business was business and I don't recall any socialist revolution
recently.

Increase subsidies/tax benies and remove patent protection.

--

Pramesh Rutajit - [email hidden] - remove tongue to reply.

[email hidden] (Kurt Ullman) wrote in message news:<[email hidden]>...

Quoted message said:

In article <[email hidden]>, [email hidden] (Jonathan

Smith) said:

If you are one of the 85% of US consumers with health/drug insurance, the cost of medications
falls on your insurer. Are US insurers not equally as good negotiators as European governments?

It has nothing to do with negotiating ability. In most Euro areas (and Canada) the governments
don't negotiate prices. They SET them.

No, they do not - they negotiate reimbursement status and listing. France is a very extreme case.
Germany has fairly open pricing. The UK has free pricing but limits "profitability" and uses
technology assessment to priovide recommendations to NHS. Italy sets maximum prices for inpatient
drugs and limits reimbursement for outpatient drugs.

Quoted message said:

The governments are what the econ-types call monopsonists, or monopolistic buyers for ease of
understanding.

The health systems which may or may not be government run (for example, germany is an exception) are
large buyers. As such, they control the shape of the demand function and can influence price. The
term monopsonist refers to the control of the demand function whereas the term monopolist refers to
control of the supply function.

Quoted message said:

In Canada, for instance, the government sometimes doesn't even tell pharm companies what they
can charge for a new med until a few months AFTER it is out. Thus, pharm companies, if they
guess wrong on the formula, have to give back "overcharges". Don't know of a US Insurer that
can do either.

The Canadian government does not control pharmaceutical prices in Canada directly - it is done
indirectly through the PMPRB and administered at the province level and it is done under the guise
of a provincial formulary system.

US insurers are no different than any other large purchaser - and why should they be? Medicaid gets
rebates based on a reference pricing scheme.

Quoted message said:

Quoted message said:

You should consider the actual patent life and the effective patent life arguments. The effective
patent life is measured in months in the pharmaceutical industry. Competition is therapeutic
based, not chemical based. The instability indices attest to this dynamic. The advantage of
monopolistic competition (this is a bonafide economics term) in terms of market behavior is in
its ability to support innovative competition while still maintaing a certain level of price
competition. Considering that penicillin doesn't work a third of the time or more, it sure is
nice to have macrolides and cephlasporins don't you think?

And there are any number of other cases where first-in-class meds get
supplanted by follow ons that have been tweaked for different side effects or

Quoted message said:

instance, over the next few quarters.

I wouldn't know about that. The effect is therapeutic not chemical competition. This is a
good thing.

Quoted message said:

Quoted message said:

What you describe here is what I was referring to earlier. The competition is not at the molecule
level but at the therapeutic level. Your observation that some newer drugs provide only
incremental benefits is a valid one. However, some of these benefits have more than incremental
value in some patients. For example, there is an argument in support of diuretics rather than ACE
inhibitors in the treatment of hypertension. The unfortunate thing is that control on diuretics
alone is short lived.

Quoted message said:

There are also many instances where medications of the same class just plain don't work the
same at the individual level. For instance, it is well established that a person may not
respond to one antidepressant (say Prozac) but will for a different member of the same class
(say Zoloft). Many other kinds and types of medications have been shown to work in the same
strange way. Personally, I am beginning to think that "Me-too" drug may not be a viable
discussion point any more.

Chemical, mechanistic, target, or market definitions are useful inexplaining competition.

I think, in general, we are in agreement. I would recommend, though, making an effort to go beyond
the NHS sound bite and investigate pricing at the country/payer level more closely. If you find
differences between how large purchasers act based on geography, let me know. So far, in my
experience, they don't. They use the same approaches, just that they have different constituencies
to whom they answer. No one pays more than they need to.

js

Governments get discounts on full retail pricing including the America VA system and so do
private insurance carriers. The person who gets shafted is the poor consumer without any
healthcare insurance. He can be charged almost anything as he has no cost basis to know how much
markup he is paying.

They say only in America and South Africa are people not provided health care as part of the
national health policy.