Amazon is in exploratory talks with generic-drug makers
cnbc.com
cnbc.com
Amazon is _notorious_ for having counterfeit items commingled with the same bin code (I might be using the wrong term), e.g. for cellular phone chargers, and even things like t-shirts.
Because of this, I share the GP's concern that Amazon would to a terrible, un-trustable job at preventing such commingling of pharmaceutical products. Sure, their pharmacy suppliers might make them right, but that doesn't prevent some random jerk (or just someone w/ crappy safety practices?) from posting a counterfeit with the same labeling.
Do you really think Amazon is going to let anyone sell any drugs?
Except, they are.
To begin with, selling counterfeit goods is flat out illegal.
Electronics have safety standards they are supposed to be tested against. Even clothing has safety standards around flammability.
If you dig deeply into generic drugs, they actually aren't all that well regulated[http://fortune.com/2013/01/10/are-generics-really-the-same-a...]. Legally a generic drug only has to be 80% as effective as the brand name drug it replaces, for psychoactive compounds that can be the difference between working and not working at all. Not so great for anti-depressants (or the vast majority of other compounds for that matter...)
https://en.wikipedia.org/wiki/Dream_Market
https://www.reddit.com/r/Dream_Market/comments/6pp9oi/dream_...
Are there issues when anyone can provide a product? Yes. But this would certainly not involve Amazon opening the storefront to allow selling any sort of drugs, but rather them sourcing generic product themselves and selling it as private label.
I would have no problems trusting this product to be genuine, just as I have no problems trusting their other private label products. It's a different sort of issue.
What's the story here? I purchased on (that failed quickly) and then another - which also failed - and gave up on those. I've actually never found a USB cable (that I often use as a charge) that I liked, but I've never set out on a quest to do so...
Is the AmazonBasics USB cable a well-known lemon?
The places with people behind the counter holding Pharmacist degrees? You trust LAZR shipping and the rest of the supply chain as much as them? Wow.
Also, selfishly, I don't want Amazon delivering meds because package theft will go through the roof when there's a chance of scoring an Amazon box with drugs.
Wow, I didn't expect to bump into the notorious SWIM on an HN thread.
What more could a consumer possibly want?
This is a product which has been pulled from several CPAP vendors, likely due to the potential danger[0] posed by leaving Ozone in the CPAP and its ineffectiveness as an actual cleaner[1]. There's also no health warnings on the product and it makes misleading claims ("Destroys 99.9% of CPAP germs").
This product is particularly dangerous because CPAP users are particularly vulnerable to breathing problems potentially caused by Ozone exposure.
[0] https://www.cdc.gov/niosh/topics/ozone/default.html
[1] https://www.epa.gov/indoor-air-quality-iaq/ozone-generators-...
Even without direct commingled inventory the generic supply chain is riddled with counterfeit and quality control issues.
There is a very big difference between buying a Generic from the likes of TEVA or Novartis vs some low tier Indian or Chinese generic manufacturer.
Even large health care providers have been struggling with the quality of generic these days when not buying from the top 3 manufacturers im not seeing any reason for Amazon to do any better.
Amazon is trying to reach a 1:1 relationship with generic producers so they can skip purchasing from a vendor, reducing costs. In this effect they would have an advantage over Walgreens, CVS, or Rite-Aid.
If Amazon really wanted to they could distribute for one of the aforementioned pharmacy chains as well, provided they are approved by the FDA & DEA.
In order to sell drugs to people, you need pharmacy license in each state.
During a job switch I had a couple of weeks were I was covered, but before I got my new insurance ids I paid full price (then reimbursed in full afterward.)
A very common generic drug I had a $10 co-pay for, was $139 without insurance at the chain pharmacy I went to. Is this ultimately what the insurance company is paying out?
I was shocked. I thought the generic would be mass-produced and only cost, maybe, a few dollars over my $10 co-pay. I suppose of that $139 dollars, only a tiny fraction was the actual drug price; the rest goes into salaries for the pharmacists, business costs and profit. It still seemed pretty outrageous to me.
If a company like Amazon ends up only charging back to the insurance company a lot less, on a mass scale, it would hopefully reduce overall insurance costs.
No not at all. “Self pay” was your status and those people pay the highest rates. This is true for almost all US healthcare. Being self pay is basically like going to a car dealer and paying MSRP with no negotiation or rebates, etc.
The pharmacy has agreements with wholesalers (sometimes directly with manufacturers) that determines their cost structure of inventory. This includes discounts and rebates and a lot of other cost reductions but All these drugs have sticker price. Insurance companies drive volume and can decide which pharmacies their patients use, thus they can negotiate prices as well. The pharmacy<>insurance transaction is usually going through a PBM, another middle man, that can tell them pretty much instantly what you owe based on your coverage (this is why a pharmacy can give you accurate pricing but doctors offices can’t). There’s a lot of intricacies but the difference between self pay and insured rates can significant. For a generic, I’d be surprised if the pharmacy paid more than 5-20$ but billed you what they could. When insured and you pay 10$, the insurance company has done the math that they will profit on their total generic base even if they lose a little on your purchase (but they probably didn’t).
I work in healthcare finance currently at a pharmacy
Large pharmacies like Walgreens negotiates contracts directly with insurers. Smaller independent pharmacies band together to negotiate as a group.
Because so much discounting and rebates happen on drugs, it's actually really hard for an insurance company to know what a pharmacy paid for a drug. Plus, there are so many drugs, it's hard to negotiate each one. What you end up with are blended reimbursement rates. An insurer might agree to pay 5% below list for all blood pressure medication. The pharmacies then try and get the best price they can. As a result, they make a lot of a handful of drugs, a slim margin on most and lose money on a few.
PBMs that own pharmacies (Express Scripts is the biggest) are in a unique situation where they know both side of the transactions - what the purchase price was so they can set reimbursement.
There are also DIR fees happening where PBMs clawback additional funds later on. That makes knowing the actual margin for a pharmacy really hard to determine until the transaction is already complete.
I’ve worked in a couple of healthcare segments over a couple decades. One thing I’ve come to learn is things can never be simple. I think economic complexity somehow adds s ton of system cost. If nothing else it adds layers of middlemen
If you don't have insurance you just default to the list price.
However that is changing. I can't remember the company, but one pharmacy is starting a cash pay discount program.
They get insanely large profit margin and its pretty much a result of years of lobbying and hard-to-get-in type of market. You are absolutely right with your hopes and when Amazon finally kicks in you will see massive "discounts" from Wallgreens CVS etc al... while they will still rack up nice profits! The whole idea behind Amazon looking deep into disturbing this market is exactly the fact how much lobbying and deals-behind-the-curtain are being made jack up the pricing.
PS. A friend of mine works high in ranking in Wallgreen and all upper management is truly losing sleep over this.
PS2. Same situation applies to aviation. All major players are in shenanigans in price gauging (they simply agree NOT to lower the price) that's why the price of oil went down over 50% meanwhile your average ticket went up 15%. With so much money on hands, I would hope Amazon will eventually disturb flying market in USA; we need it.
Amazon also has questionable quality and reliability these days with co-mingled inventory, 3rd party sellers, and reviews that are impossible to determine the authenticity of.
Please enlighten me as to how "consumers will only benefit."
https://www.reuters.com/article/us-usa-generics/u-s-states-a...
Flint, Michigan has lead-poisoned tap water.
Look at the salmonella cases that pop up every few years and kill handfuls of people. Look at the infants accidentally being given methadone prescriptions. There's never any real consequence for mishaps in the US. Maybe a fine at worst.
Even American generic manufacturers get a large percentage of their APIs from India. Surprise surprise, weak patent laws mean you get pretty good at making complex things.
The bulk mass-produced excipients/binders/“fillers” often come from China, since that’s what they’re good at.
Pressing tablets and packaging them is fairly commoditized work. The extra cost of doing it in the USA won’t make a perceptible difference to the end-user.
QC is easier when you’re working with verified pure ingredients.
I’m much more worried about food made with imported ingredients than drugs made with imported ingredients.
When a 500k tablet per hour rotary press can be tended to by a person or two and do its thing, labour costs aren’t very relevant.
Just because counterfeits still happen doesnt mean they are not trying to stop nor does it mean they are doing a bad job.
And Im sure there will be further regulations around this then there is for nockoff plastic goods.
I am not normally a conspiracy theorist but Amazon manufacturing things to spy on me with audio, video, being able to unlock my doors and now know my prescriptions, naaah.