Mylan’s EpiPen price hike was a scheme to stifle competition, rival claims
arstechnica.com
arstechnica.com
- Price transparency for common treatment/diagnosis.
- They must charge insured and uninsured the same rate, no more 70% discounts for the insured.
This would, if nothing else, get the insurance company and patient on the same team (since they're both fighting for lower prices across the board, rather than just higher insurance discounts on bonkers pricing).
I tried to clarify - different doctors are free to charge different rates for a given service (say 15K for an appendectomy), to make them charge the same is price fixing and should not be allowed. What I advocate is that Alice, Bob, and Charlie all get charged the same price by Dr. Sam regardless of insurance coverage or any of the other deals that take place today. Dr Alfred is free to charge a completely different price than Dr Sam.
Say two people get their appendix out and the hospital bill is about 15K. One person is uninsured, so they get a bill for the full amount. The other is insured, so their insurance company gets a bill for 15K. The insurance company has an existing agreement with the hospital and says "We're only going to pay 12K" and that's what the hospital gets. Then they pass on the 30 percent of 12K to the patient and get that. This is seen as a bonus the insurance companies provide - negotiating better prices - 12K vs 15K. But what's really happening is the hospital is going to try to get 3K more from the uninsured guy.
My argument (how I think it should be) is that the hospital has to demand the same payment from everyone for that procedure - you will be responsible for whatever portion your insurance company doesn't pay, which is full price for the uninsured. Now the other hospital across town is free to offer the same procedure for 13K or 8K or 25K - whatever they think they can get, but they have to charge that price to all patients. This promotes competition between providers AND insurance companies and it will result in lower prices for both.
"In 2013, Sanofi began selling Auvi-Q, which works to quell life-threatening allergic reactions, just as EpiPen does. Sanofi priced Auvi-Q on equal footing with EpiPen. And, initially, Sanofi claims it showed promise of gaining market share and providing real competition to EpiPen, which at the time had more than 99 percent of the market, according to Mylan. But that all changed when Mylan began using dirty tactics, Sanofi alleges."
Looks like Sanofi sold the product to another company - the $4500 number is a price from the company Kaléo.
"In 2015, Sanofi pulled Auvi-Q following quality control issues. The device has since been put back on the market by another pharmaceutical company, Kaléo. The list price of the newly released Auvi-Q is set at $4,500."
Obviously Sanofi should have been able to massively undercut the Mylan price if there truly was xxx% profit margin built in, so it is not really apparent why they didn't do that.
My point about "good guys" was because of the whole tone of the article. A romantic story of two brothers, one of whom became a doctor, and another an engineer, so that they could invent their dream automatic injector. Except that autoinjectors are a 1950s technology, used by most militaries to deliver antidotes to chemical weapons - here's a film from 1963 which demonstrates a device that I have a hard time telling from an EpiPen: https://www.youtube.com/watch?v=oeyW8aoP8mE.
So what the hell was there to even invent, why are these devices covered by any patents at all, why is the FDA allowing just two companies to dominate the market (I am sure plenty of people would like to charge $100 for devices which cost a few dollars to manufacture), and why doesn't a lockstep price hike from $130 to $500 attract the attention of antitrust prosecutors? Because healthcare in the USA is an insane fever swamp...
[1] https://onlinedoctor.lloydspharmacy.com/uk/allergy/epipen
To me though the kicker was at the very end -- "The list price of the newly released Auvi-Q is set at $4,500." That is for the device now being sold by another company (Kaleo). I just don't understand what is going on here. EpiPen is priced at what $600? CVS sells a generic for about $100 (Adrenaclick).
It's not a completely ridiculous regulatory decision, but it certainly factors into people not using the alternatives.
Oh wait, it talks to you. Why do you need an EpiPen to talk to you? You literally just take the cap off, whack it to your (or their) thigh, and count to 5.
In an emergency situation it's occasionally other parties, with no experience or knowledge of these devices, who administer. The design decision was likely made for observed reasons.
2. Except you missed a step - you have to take off the cap AND the safety. I don't need an EpiPen to tell me how to use it, but if my son is anaphylaxing, I want a panicking 15 year old babysitter to have a device that is as fool proof as possible.
In at least one study[1], admittedly funded by Sanofi, ~1/3 of people stuck the wrong end into their thing and ~1/2 didn't keep it in long enough. Just to emphasize on the second item, you said "count to 5" when the EpiPen instructions say 10 seconds. Only 35% of people completed all the steps correctly.
[1] http://www.jaci-inpractice.org/article/S2213-2198(13)00125-6...
Ow...
I yearn for the day that humanity reaches Star Trek ideals, and looks back on people like the Milan CEO the way we regard magnanimous tyrants and bloodthirsty war criminals.
3 month supply costs less than one months co-pay.
http://www.npr.org/sections/health-shots/2016/09/01/49223579...
If you were to look at the statistics, these would either be edge cases or outliers when considering the overwhelming evidence that in most cases, free markets are far better than having burdensome government regulations.
It's funny to hear people complain about how bad the free market system is in this case, but are also crying about employment immigration issues and how we can't get MORE H1-B's visa's, and why SV companies can't bring in more highly skilled candidates from other countries.
It cuts both ways. There is a median in there. Heavily regulated or totally free markets never work, we need to find a balance.
The problem with your type of logic is illustrated best not by the complicated reality, but (as usual with philosophical problems) a corner case. Imagine that I invent a fantastic new medicine - and being an evil genius, leave it in my lab, never announcing it to the world, knowing perfectly well that millions of people around the world could be saved if I did.
In your logic, this absence of action makes me evil - although these poor sufferers would suffer just the same if I didn't invent this new medicine to begin with. The same is true for EpiPen: it's their inaction you condemn, not action.
The medical industry is not making the world a worse place through it's actions; it just isn't doing it a better place to an extent that you would want them to.
The ridiculous price has little to do with the original inventor.
A not stupid regulatory system would evaluate the value of the improvement to the market (likely hugely negative in this case). The idea wouldn't be to deny the company the right to the patent, it would be to deny regulatory approval for the patented version of the device.
(the argument being that decreased access to the patented device costs more than the benefit provided by the minor safety improvements it offers).
I'd take my systems stupid and simple, please.
They would of course argue that this confuses the marketplace. But they are sitting there exploiting the confused marketplace, so not much of an argument to be made along those lines.
Something changed in ths mid-90s. Neoliberalism became salonfähig, or something.
You have someone like Jonas Salk who basically fit your example perfectly, except he decided to share his invention with the world instead of hiding it away as per your example.
You're free to not share your cure with the world, no one could force you, but I would question the motivations of someone who chose not to.
Your claim is factually incorrect. The issue here is specific, purposeful, anticompetitive behavior.