@cocosweet: I would venture the guess that it's because the original cost of
research, development, clinical trials, and approval, is recouped by the drug
companies from the large insurance companies in the US. Without that money, the
drug companies could not stay in business. They wouldn't have the funds to
create these medications.Because their initial investment is
recouped from big insurance in the US, they can sell the product in other
markets (Canada, Mexico, Europe) for much less. If they didn't get the big
money from big US insurance companies, then the drug wouldn't come cheap in
other markets.Also, many of the drugs that are cheap in other
markets are manufactured by secondary companies who didn't make the initial
investment in R&D, trials, etc., so their cost to produce is minimal. Again,
without the original big money from big US insurance the drug never would have
been developed in the first place.
@Invisible Hand. Drugs are cheaper in Mexico also (much, much
cheaper). I can assure you there is no Gov subsidization and they do NOT have
higher taxes. Explain that!
This is an old debate that the public has never really taken to heart but never
the less needs a broadly base vocalization. Recognizing that pharmaceutical
manufacturers need to recover research and reasonable profit. The stumbling
block is "reasonable profit". Using Pepcid as an example, the cost to the
pharmacy before going generic was $132 for 30 tablets., or $4.40 per tablet.
When the generic became available the price dropped to $6.50 per 100 tablets or
a little less than 7 cents a tablet in cost to the pharmacy, or a cost to the
pharmacy of $2.10/ 30 tablets. Now, figure the profit of 6 to 8 million
prescriptions a year--the is manufacturer profit. At $132/30 tablets, pharmacies
rarely marked this up more than 4 to 6 dollars a prescription because of
I find this article very interesting, however I find the comments even more
interesting. You see I have MS and just one of my drugs cost $4000.00 per month,
I take 7. There is no cure for MS and without this one daily interferon drug I
would progress quickly to death. I do now have Medicare on a supplemental
insurance. Monthly I never know if they will pay for my shot one month it is
approved the next month it isn't. Why? because it is not a CURE. due to the
on/off I have now progressed to a wheelchair and need assistance. Before I could
work. It is the Insurance people not the drug Co. that decide if I get my meds
or not. When I worked I paid cash for them and did fine for 14 years. BC/BS
decided at age 55 I no longer needed my drug. So here I think Insurance is more
at fault. I am a user of a drug that extends my life why not let me decide if I
@Screwdriver: I agree that the government already distorts the free market. This
is a problem. But the solution is more freedom, not less. What's your solution
to the problem of "secret combinations" controlling markets? It's not very
useful to call someone naive and then not propose a better solution. Do you want
MORE government control?@cocosweet: Why are drugs so much cheaper in
Europe? Are they subsidized by the governments with their higher taxes? Are they
limited in their choices of drugs? There has to be some tradeoff unless you
really believe in the notion of a free lunch.
Why the cost? I once worked on a court case where a major pharmaceutical
company was attempting to defend its patent on a simple cholesterol medication
against a generic drug manufacturer who had jumped the gun on producing the
medication during the exclusivity period. One of the witnesses on the case was
the company's chief scientist on the team that developed the drug. He testified
that in his 34 years with the pharmaceutical company, this was only the second
medication he'd worked on that made it all the way to market.Why do
drugs like this cost so much? Because it costs a lot in time and money to make
them and drug companies are given a very narrow window to recoup their expenses
before generic manufacturers get to copy and distribute at a fraction of the
costs. Cost cutting definitely has its place, but consider for a moment where
medicine would be if the pharmaceutical companies went out of business.
When you travel to Europe the drugs are MUCH less expensive and we are talking
about name brands. US consumers are paying an inordinate amount because of the
Free Market and lack of regulation. I am all for Free Market for
most things (even if it did cause our economic collapse). However, when it
comes to a life/death sort of product, where the end user has NO choice? That
is where we desperately need the government to step in.
TMKH: As one of those nurse I would say it is less of a death panel thing, and
more of a reality check thing. When I first started in nursing we almost never
discussed cost with the patient.Now we present it as a cost vs.
benefit analysis, and allow them to decide based on their situation, and their
desires.At least now we are letting people know in advance what they
are choosing, instead of sticking them with a massive bill that would have made
an impact on the choices they made.We see it in all areas of
medicine, not just cancer. More people are trending towards the conservative
treaments and the wait-&-see approach. Cost is a big factor, but so is the
awareness that aggressive treament is not always best.The biggest
cost of a new drug is split between Research & Development, and the clinical
trials they are required to run (both in animals & human). People in trials get
compensation (which the drug company pays out). The US is one of
the last countries that still produces new medications in volume, and
frequency. "Medicine of the future" will not exist if companies stop research &
"Doctors and insurers increasingly are doing the cruel math that many cancer
patients want to avoid, and questioning how much small improvements in survival
are worth."Hmmm, sounds like death panels ALREADY exist! We don't
need the government to create them, the private insurance companies are doing a
great job at it.
It's so naive to even talk about the "free market". Look into the corruption in
big pharma before you even speak of such fiction. It's like saying the free
market will jail the mob for the FBI. Secret combinations are way ahead of the
free market. You have to go below the Forbes 500 to start to find a free market.
The best way to lower the price on this drug is to let the free market operate.
If the company can make $93K for one dose of it, you can bet they will work hard
to figure out a way to produce as much of it as they can. When they make more of
it the laws of supply and demand will kick in and the price will fall.Once again, the cure for high prices is high prices. There's nothing unethical
about that. What would be unethical would be to tell them they can't charge so
much, and then all the people that devoted years of their lives and millions in
investment to develop that drug would not be compensated.
Death Panels? WHite House to Blame? Have we really become that warped and
twisted? If you are looking for today's death panels, head to United Health
Care or one of the Blue Crosses right now. They all in very capitalistic
manners decide what treatments and at what levels they allow their paying
customers to receive. Stop the red herring arguments.The problem is
we do have a broken model for funding basic medical research. For every
successful treatment there are ten that don't make it to market. Those cost do
need to be recaptured somehow, but how those cost are distributed is at
question. What becomes even more disturbing is when you look at
medicine distribution by channel, the cost vary widely. For example, one
medication at a leading drug store cost $70 per dosage. The same branded
medication at a big box wholesale club cost on $40. In Canada, it is even
lower. So medical cost will vary widely depending on your location more than
on the actual cost of production or development.What is even more
sad is the Republicans while in control banned states from negotiating with drug
companies for lower rates like Canada.
The big question is why each of these drugs cost so much.If a drug
costs $50,000, is it because it costs the company who makes it $40,000 in
manpower and equipment so they must charge a lot in order to make any profit at
all? Is it because only a few people in the country need it so
companies have to charge a lot to recoup their development costs?Is
it because the drug approval process is so long and expensive that drug
companies have to make huge profits on the one or two drugs that get approved in
order to make up for the hundred drugs that never make it?Is it
because every drug company has to put a ton of money in a liability account to
pay out the outrageous lawsuits that will surely accompany any drug that is
successful but may have a side effect?There are no easy answers,
although it is very easy to just assume that everyone in the drug business is a
greedy, heartless person.
@ MY2Cents: You are correct that they are not asking the right questions. Until
we have answers to those questions it is not wise to blame the drug
companies.Pharmaceuticals are very expensive to develop, test and bring to
market. Government regulation is responsible for much of this cost. Drug companies formerly charged more when a new drug is released and reduce
the price when the research and development costs had been recouped. The
government sued companies for price gouging because they lowered their price.
(Lowering the price was sited as evidence for gouging) Now no drug company will
lower their price, ever.First the government causes the problem,
then they sue private business for the inevitable results.
Dialysis keeps a patient alive at a cost of $50-65,000 a year. That is where the
$50,000 a year figure originated. We, as a nation, have decided that is a "good
value" for patients with renal failure.Interesting to note that
Medicare is not allowed to consider the cost of a treatment when determining if
they will cover it.Very difficult decisions. The country has limited
resources and infinite treatment needs.
Here's a thought...Eliminate any and all govt. insurance subsidies.
Eliminate "insurance" copays and other subsidies that jack up the price.Let the market decide. We'll see how long that price holds when no one
will pay it.
This is about two separate issues:a. AP propaganda which lays out
the administration case for "death panels" by showing it is too expensive to
keep people alive. Note that the patient is one of those "evil rich executives"
not some poor minority AIDS patient.b. The cost for new drugs is
astronomical and mandating that companies cannot make a profit, or even cover
the huge cost of bringing it to market will kill all pharmaceutical innovation.
It takes a lot of smart, well educated scientists years doing
unsuccessful experiments before coming up with a possible cure for something.
More years jumping through FDA regulatory hoops and clinical trials, and legal
expenses getting it patented and protecting against counterfeiting. All those
costs have to be covered by what is charged for the drug, often used in limited
quantities for the first several years. If successful, and development costs
are recovered, then the per dose cost can be lowered. However, they still need
lots of money to work on developing the next wonder drug. And, investors
deserve some return on the money they invested.We should praise the
drug companies, not vilify them. Unless justifying death panels.
This highlights the reality of health care in the US, we may have the best
health care in the world, but we may not all be able to afford it.This has always been the case throughout history. The truth is we already
limit health care to those who can afford to pay premiums. Currently there are
millions of American's with who are too poor to get this treatment, or any
other.Frankly, there is a limit to what we can afford as a nation.
Maybe, just maybe, we cannot afford everything we want?
This article started out and really upset me. Why and when there is such waste
going on in the White House with the expensive vacations and other social
activities at the taxpayers expense. Then, Why does the government put a cap on
how much it will pay for the citizens who PAY these taxes and it goes on and on?
Where does the administration stop it or Congress draw the line
here? This is where the government spending is lax and then tight
fisted at the same time.
Still, they are not asking the right questions. Why does this drug and treatment
cost so much? The medical industry needs to have some cost containment controls
levied against it. These costs are not non profit costs and a slap in the face
of every american seeking health care. Health care is looting America and
government with this kind of ridiculous costs. It's way beyond reason or
reasonable and the real ethical question is why is health care allowed to loot
and pilfer the sick and dieing?