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Comment by alexosh1 | Hacker News Reader

Hi guys, Alex Oshmyansky here, CEO of the Mark Cuban Cost Plus Drug Company. Crazy to see our little project at the top of Hacker News!

We're planning to introduce a lot more drugs with transparent prices later this year, cutting out monopolistic middlemen in the supply chain and alleviating pharma drug shortages, particularly for rare and orphan disease conditions.

We are looking for a few devs (fullstack, frontend, and backend). If anybody is interested, drop me a line at alex@costplusdrugs.com

In the meantime, happy to answer questions if anyone is interested!

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Hi Alex, do you have any plans on selling or attempting to get FDA approval for drugs that are used and known to be safe in other countries, such as the UK?

Our daughter has a life threatening condition that I’ve posted a lot about on, a complication from spina bifida where she holds her breath when she gets upset. Many kids die from the condition.

There’s a medication, piracetam, that a child with the same complication uses in the UK. It’s safe and has greatly helped the little girl in the UK. When we mentioned it to doctors we were immediately shut down and told it was impossible to get in the US.

Any chance of the Mark Cuban Cost Plus Drug Company seeking FDA approval for piracetam and drugs like it?

Stories like this would be a game changer for this new company. I genuinely hope they go for it. In a way, it's surprising that there isn't a charity dedicated to this type of effort for drugs considered safe.

The Wikipedia page [0] says piracetam has been around since the 1950s, and was used to treat epilepsy as early as the 50s. Our daughter’s PEAC [1] is a rare complication of a relatively rare disease.

From my very limited understanding of the regulations, a company would have to spend the million+ dollars it costs to get FDA approval, but then wouldn’t be able to recoup that cost by selling the drug exclusively because the patent has long since expired. The US has this class of drugs that just never got approved and no drug company will ever pay to get approved, even if they are commonplace in other nations.

[0] https://en.m.wikipedia.org/wiki/Piracetam

[1] https://medcraveonline.com/JPNC/peac-prolonged-expiratory-ap...

I had to check if it would fall under Trump's Right to Try Act [0], but sadly it doesn't seem like it would meet the requirements. Perhaps this is something we can continue pushing for more freedom enabling legislation though.

[0] https://www.fda.gov/patients/learn-about-expanded-access-and...

It sounds like we need a mechanism for a company to be granted short term exclusive distribution for drugs that are out of patent but not approved if they sheppard that drug through the approval process.

I believe that's in part what the Orphan Drug Act does - https://en.wikipedia.org/wiki/Orphan_Drug_Act_of_1983

In the short term, how are you getting access to this medicine? Having your friends ship it in from abroad?

I’m hesitant to reveal how as the FDA had been cracking down recently, but racetams are very popular in the nootropics community. It’s sad too because there’s a huge difference between her with this medicine and without.

A few times we’ve missed a day and it’s not a fun experience. Something as innocuous as a diaper change can mean giving her getting upset, turning blue, pulling out the a bag and mask, and giving her oxygen and hoping she’ll come to. Then she’ll sleep for hours. If it’s especially bad, like it was before, she’ll forget words which is super scary.

Shouldn't we keep piracetam (and the rest of the racetams) away from the FDA? https://nootropicsdepot.com/piracetam-800mg-capsules/

The tyranny of prescription required isn't worth it.

The problem, and the reason they’re out, is because of the FDA. While I agree in principal I wish I didn’t have to search websites for piracetam that are all out of stock due to customs not letting them through.

My own interest in nootropics is some years behind me now, but I note that Nootropics Depot does have bulk phenylpiracetam powder in stock, and I don't recall filling my own capsules to have been especially difficult. Slow and exacting work, to be sure, but also the kind of work that a good podcast or TV show helps go faster. With a little practice and a good capsule filling machine, you can make a month's worth of doses in a couple of hours - cheaper than buying prefilled capsules, too.

Yes, we currently use a powder that I weigh and mix into a solution, and administer the piracetam via feeding tube.

FDA is seizing all piracetam at customs. They haven't moved to the other racetams yet, as far as I know.

From the reddit discussion https://www.reddit.com/r/Nootropics/comments/hkn7v2/piraceta...

Articles like this one are driving their actions. https://jamanetwork.com/journals/jamainternalmedicine/articl...

Hi Wincy, Sorry to drop my comment here without any scientific evidence or any such certification of experience.

But I had a similar condition in my childhood. Many doctors thought it was some form of complicated asthama or something but couldn't figure out what exactly was it.

Then my parents put me in an breathing camp (yoga retreat kind of thing). I was there for six months and we were convinced there that breathing is life. Breathing is the most important thing in and for life. And slowly, the condition disappeared.

The condition was more of an impediment in the brain blocking the breathing command when I got upset unlike some incurable damage to the lungs. Just teaching and reminding us to breath every second for six months made things a lot better.

If there's no such camp/retreat in your country, you could try India.

You both brought up a memory for the first time where as I child I once decided to hold my breathe and started to panic and worry because I didn't seem to be able to start breathing again. I think it was only a one-time thing, and obviously I started breathing again. I wonder how common it is and what the state of a child who experiences this is - it's fascinating.

Will your company become obsolete once the US removes the ridiculous law that US citizens can't buy drugs from other countries? Every modern country has solved the low price drug problem except the US because of criminal and fraudulent healthcare laws.

Ideally yeah, would be good if we didn't need to exist. There are a variety of policy initiatives the US could likely implement to bring costs down. My kind of mindset with the company though is I am a nobody from nowhere, and congress isn't going to listen to me. I can make cheap / sell medicine at an affordable price though. So I will do that.

I'm not sure drug importation will work though, not because it's a bad policy per se, but I'm not sure that other countries will let the US import their low-cost medicines if US law changes in order to protect their domestic supplies.

There's Canada as an example case. We have ~10x the population of Canada, and California alone could use up all of Canada's medicines. Not sure Canada would go for it.

Think it's worth a shot though. I know there are some trial programs going into place in Colorado and Florida around allowing drug importation. Will be cool to follow and see how they play out.

Makes sense, I always appreciate healthcare companies that capitalize on bad laws saying that ideally they wouldn't exist and they're trying to work within the existing framework.

Cross-border drug buying works well in the EU, where any European country can buy drugs from any other European country, so whoever has the lowest price usually wins the market.

As a private company, your incentive is to maximize profit for shareholders. Since all you have to do is undercut high drug prices a little, what will stop you from the same price gouging that all other US drug companies perform?

Well, there's some technical measures we've taken and some practical ones to ensure we work to be profitable but remain focused primarily on improving public health and helping patients.

On the technical level, we incorporated as a public benefit corporation, so we are judged not only on how profitable we are for shareholders, but how well be maintain our social mission. That is actually in our charter documents and is a legal requirement.

On a practical level, Mark Cuban is our lead investor and his interest is very much focused on helping people and fixing system issues in healthcare. We also did some screening to ensure our other investors are socially minded and prioritize social benefit as well as profits.

My mindset is that we need to be profitable to be sustainable and grow enough to help the overall system, but we won't be extortionate.

> On a practical level, Mark Cuban is our lead investor and his interest is very much focused on helping people and fixing system issues in healthcare.

Also he got to write his name on it

I wonder how much credibility his name adds in the short term. People might take it more seriously if it's backed by someone with a reputation.

In the longer term, success in the health space could add prestige to his name, ala the Nobel prize.

Yes, I agree with both. Seems win/win, and a much better claim to fame than putting radio on the internet! ;-)

The only reason I clicked and am reading these threads right now is because I was curious why he put his name on a drug company.

Even more importantly, the company got to put his name on it.

Nice! We had Obamacare, now we get MCubanocare?

Obamacare actually increases the cost of drugs. Here is a study showing the comparison adjusted for inflation.

https://pubmed.ncbi.nlm.nih.gov/28224469/

For some single source drugs the suppliers absorbed some of the subsidies, while others and generics were cheaper for consumers. It is unfortunate that sometimes customer facing subsidies get abused by single source suppliers.

This study is not about drugs per se, but only some oncology drugs that were popular in 2006. It even states "however, generic oncology drug prices showed no significant changes" in the abstract.

That’s selective quoting. The study states in the abstract the top selling drugs saw price increases. Here is the full abstract.

> The results show that the average annual price of top-selling cancer drugs in 2006, adjusted for inflation and secular changes in drug prices, have increased by US$154 and US$235 for branded and competitive brand drugs, respectively, following the 2010 ACA; however, generic oncology drug prices showed no significant changes.

The top-selling branded drugs price increased. Generic drug prices (the relevant comparison to Cuban's Cost Plus) showed no significant changes.

Probably more "the company begged someone of high visibility to write their name on it".

Cost of advertising is a serious problem for generic drug makers. There are a lot of drugs where there exists an identical, cheaper, generic version, but the more expensive one gets sold because neither the doctors nor the patients have any idea that it exists. Hence all the "ask your doctor for x" ads, but the problem is that advertising on that scale, especially for low-incidence conditions, is very expensive compared to the amount of money you make, an so will result in just another expensive drug.

A celebrity putting their name on a drug company and then maybe mentioning it a few times publicly in places where normal people hear about it may make people who are facing very expensive drug bills look up the site and see if they make something useful for them.

If there’s an actual generic (e.g. Naproxen Sodium :: Alleve), then your doctor just has to ensure that the Rx isn’t “fill as written”. The pharmacist can then offer you options (Namebrand at X times 5 or generic at X)

If it’s the case where there’s an older generic and a newer product still under patent, that’s a discussion with your doctor: Is the newer product worth the money, or should I stick with the older thing?

Can you put your email in your profile please? Reaching out from working at a healthcare company now.

You can find it at the top of the thread: alex@costplusdrugs.com

In Italy our representatives negotiates the prices of the important drugs with the pharmaceutical industry, and they have little or no cost for the individual. There are always some very annoying exceptions, of course, but that's the general rule. We all take it for granted and demand it, doesn't matter the political orientation. I think your representatives are not doing a good job (not that ours are better, eh;), and makes me wonder what you vote for, if not for this basic things.

Would it not be somewhere in the middle though? Instead of completely saying yes or no, maybe Canada would say "We'll allow you to purchase X% of all drugs produced in the country, as we need to hold onto some, but we'd love it if you'd buy the surplus."

Canada produces very little. They are importing it from the big manufacturers. Last time importation from Canada became an issue the companies just said to Canada “we’ll sell you what you bought last year plus 5%.”. Then Canada got to choose - give those drugs to Canadians or sell them to the US. But they can’t do both.

> We have ~10x the population of Canada, and California alone could use up all of Canada's medicines. Not sure Canada would go for it.

Couldn't Canadian drug companies increase supply if the demand was there? In the short term, sure, they would not be able to handle our level of demand, but unless there's some constraint I'm not aware of they could always just scale up and make more animal insulin or whatever.

They don’t make the drugs in Canada. They buy them in the open market, likely from us.

It's sort of the open market.

The history is that Canada used to have "compulsory licensing" for patented drugs. Anyone could manufacture a patented drug in Canada and pay a ?6?% or whatever royalty to the patent owner and they just had to deal with it.

Over the years, first 4, then 10 years of exclusivity were provided to the patent owner.

Then the WTO came along, and presently, everyone has agreed to ~20y exclusivity and charge/pay the median price of OECD countries before it's a royalty-free free-for-all.

http://publications.gc.ca/Collection-R/LoPBdP/BP/prb9946-e.h...

Canadian generic drugs today aren't usually cheaper than US generics, except where patent exclusivity mismatches.

> There's Canada as an example case. We have ~10x the population of Canada, and California alone could use up all of Canada's medicines. Not sure Canada would go for it.

Depends on the country. For example India is the largest generic drug manufacturer and has a population of over 1 billion, and they already export their drugs to many countries.

India would go for it without even noticing I guess.

The laws regarding importation from other countries are odd, but they are not what you think they are.

In effect, it's about 're-importation' of drugs, not so much regular import.

The Government of Ontario negotiates drug prices for it's citizens, as to other entities elsewhere.

By selling to XYZ regime at ABC price, drug companies create a situation wherein 'the resulting price will be the lowest price we sell to any regime' - because of course everyone will want to import from there.

In many cases, the price sold to XYA regime isn't quite a very good measure of net market prices.

Ergo, it's a weird law, but it's rational on a level.

To start - there could be a slew of laws requiring transparency on pricing for everything in the medical domain. That would be a good start.

More challenging - Americans could actually get together and start negotiating hard on prices. This may require some legislation.

So the 're-importation' issue is an artifact of an odd system, not in and of itself the issue.

Ontario's a great example of how this problem is usually solved in developed countries.

OHIP negotiates the prices of all drugs on behalf of Ontarians by being the sole purchaser, and then drugs are sold at that rate (cost plus, I believe) in pharmacies. Further, the cost of all services is listed on the OHIP website. [1] Not that anyone needs to worry about that as they are fully covered for everyone - not the drugs (yet, fingers crossed), the procedures.

[1] http://www.health.gov.on.ca/en/pro/programs/ohip/sob/physser...

Tons of new drugs are never even marketed in Canada due to this, or marketed much later.

Almost all expensive drugs end up being on a special permission list, where you must to beg the government for access.

Not any different than dealing with an insurance company, really. At least you can sue an insurer.

You can sue the province too.

However of course consider delays in getting a drug to market aren’t always provincial; Health Canada has their own timelines and schedules for approvals, sometimes it’s faster than in America and sometimes it’s slower.

The difference is frequently you’re forced to sue insurers as they have a profit motive to screw you. The province only cares about getting you healthy within their means.

It has benefits but also obviously drawbacks.

Ambien is not available in Canada for example.

One of the things about hard negotiations is that sometimes the other side will call the bluff and walk away.

And of course in rationed systems you don't get things that 'the masters' decide you don't need, like Ambien.

In the case of Ambien, I don't care, I question the real medical value of it, but you can see how that could get out of hand with other things.

It would better to solve the 're-import' problem with better regulation - and of course, initiatives such as the the MC Company here.

I think the Cleveland Clinic and some others like it are technically non-profits, there are models that work.

The thing about MC company is they have no obligation to keep their pricing or business model moving forward. They can sell to an insurer or pharma company or just raise their margins. This is good but shouldn’t be integral.

Other countries don't solve the problem via re-importation.

Re-importation shouldn't be illegal, but it shouldn't be necessary - it's really kinda dumb. Other countries have solved this problem by making healthcare universal, and forming a bulk purchasing group which strong-arms providers into charging something the system can bear. The end user doesn't have to care how much that is, because most developed countries simply pay for the drugs people need in the first place.

The ideal way to obsolete this problem is to follow their lead - get Medicare for All to happen and restore Medicare's ability to negotiate the price of drugs directly with manufacturers.

Then nobody has to pay for the drugs directly in the first place.

the bulk prices developed countries in Europe are paying is still much greater than some countries that have a truly free market system. For example, I lived in Tanzania and all drugs were imported and all of them over the counter. Drugs that literally cost thousands of dollars a month in America without insurance would usually come to around $5-10.

I doubt the American people (or American industry) would ever allow such a truly free market system to transpire, but I know for a fact it can work.

Labor is cheaper in Tanzania obviously, but even if you adjusted for the more expensive labor, a free market system (vs the crony capitalist system we have now) would probably be 10-100x cheaper.

Also, even controlling for median wage, the drugs are vastly cheaper in Tanzania vs America. A median worker there might make around $5-10 in wage, so most drugs for a month supply would be only a day of work. Median hourly wage in America of $15 would correspond to drug prices between $60-120 dollars, much cheaper than most medications without insurance. In reality, it should be much cheaper, as the marginal cost can be reduced a lot through online pharmacies (remember that $5-10 cost in Tanzania not only factors in product cost and labor cost, but a staggeringly inefficient distribution network).

In short, I don't believe there's any theoretical reason why generic drugs couldn't be dirt cheap and affordable by all in a free market system. After all, capitalism has done a stellar job at reducing the cost of consumer goods over time, and medication should be no different.

If everyone could buy lightly regulated pills from alibaba, it would definitely be a win from a utility standpoint. But of course such a thing would never fly, as maximizing total utility doesn't get people elected. Everyone might win except one guy who died from bad pills and the whole gig would be up, even though the total utility function of every citizen in aggregate was being correctly maximized.

The strong needs of the few always trumps the weak needs of the many. If everyone paid one $1 dollar per day in order to prevent one death, I'm sure some politician would call it a massive win, even though that's an aggregate loss of 100bn dollars annually and the money saved generated more utility than the utility lost by that one guy dying.

Unfortunately, human beings are unable to make correct statistical/utilitarian decisions and support so many policies that are a net negative utility wise.

Drugs in countries like Tanzania are cheap because drug companies don’t think they can get more money out of it, it’s more of a charity project. They offer them to developing countries well below cost - Tanzania is the 15th poorest country in the world with a GDP per capita of $500 (2011). It’s not an example of a free market.

I'm not sure that's true. Most of the medication I came across came from third rate Russian or Indian suppliers. I highly doubt the sales of drugs from these countries (also poor countries) to another poor country (Tanzania) was charity.

It ain't a charity: after the initial development, drug production is usually very cheap.

Aligning prices with purchasing power allows pharmaceutical companies to get _something_ out of the markets they'd get nothing out of. And with large numbers, that something might turn out to be a bit more.

Third rate Indian suppliers? I’m not sure if you’re implying that the price is low or the quality is poor. If it’s the latter, you don’t know much about Indian pharma companies. Btw, Indian pharma companies selling high quality anti retro viral drugs to African countries at low prices is why HIV is relatively under control right now.

https://www.fraud-magazine.com/article.aspx?id=4294983341

You need to distinguish between drug development and production.

Sure production cost is usually low and that technically allows to sell to poor countries essentially at cost plus a tiny margin.

But that's only half the story. Drugs need to be developed. From idea to market only a tiny fraction of medication makes it. You need studies ovet studies, and most of the time a drug does not make it through that process because it's ineffective or dangerous or both. The few that make it need to compensate for the cost of this process, not just their own but all of those that didn't make it.

So, in "rich" countries, a pill that costs $0.10 to produce can easily cost $1000. That's a necessity to finance the whole process of getting there.

After that is all done and established, sure, you may get that same pill for $1 since it's either that or no sale. But that does not mean the whole system would work for $1 per pill everywhere in the world. Then the pill would not exist in the first place.

See also: region locking in video games. Again, the development costs vastly outweigh the marginal cost of producing an extra unit to sell, so they sell the product at whatever the local market will bear, which breaks down if richer markets have access to supply from poorer ones.

Strong arming is the right term. United Healthcare in the US has 40 million members. Bigger than the entire population of Canada. Yet they can’t negotiate prices anywhere as low.

> Yet they can’t negotiate prices anywhere as low.

Can't or won't?

This would just screw over poor countries. See the example of Tanzania someone gives below: selling drugs cheaper in such a country will stop immediately if it risks undercutting the US market.

> This would just screw over poor countries.

Lot of drugs are manufactured and exported from India.

While the general idea that rich countries should help poorer ones has some merits, the idea that poor people in rich countries should be shafted in order to provide cheaper drugs for everybody else doesn't quite make sense to me.

I've heard the argument that Americans effectively subsidize drugs for everybody else. While it may be true, it still seems like a terrible situation to me, even as a non-american. There's got to be a fairer way to work this out.

Hi Alex,

How is the example cost of Albendazole right? Technically, it's a generic drug, and the cost is 10c (locally in India, atleast). What marks this up 130x in the US?

[1] eg: https://www.1mg.com/drugs/zentel-tablet-137773

Pharmaceutical companies in the US charge whatever they can get away with, with the argument that insurance will cover it for most people. The price of insulin (clearly not a new drug) has increased 10x in the last 15 years.

The price of insulin (clearly not a new drug)

This is a misconception. There are dozens of different drugs people refer to as Insulin, some new insulin analogs are better, and expensive. You can still get old synthetic formulations very cheaply. Walmart famously sells them for $25.

https://www.medicalnewstoday.com/articles/311300#drugs-for-t...

How is $25 "very cheaply" ? That's already super expensive !

It's absolutely insane really. $25 is not cheap for something you need to live.

Sometimes I'm so happy to live in Ireland, I know we have our faults. But at least with some things, we seem to get it right.

Diabetics in Ireland have 0 cost associated with it. They can go to any pharmacy, and get anything related to Diabetes for free, and as much of it as they need.

This should be the case for any life long illness - or any illness for that matter, in any country; in my opinion. Healthcare should be free for all, it amazes me that this is not yet the case. I do know deep down that it will be eventually though.

But it's not 'free' in Ireland, right? It's just covered (as it should be). Here in Czechia it costs around $30 - covered of course. But the US price doesn't seem out of reality - it's cheaper than here!

It's free at the point of service.

Yeah, in CZ you also get it without any out of pocket payment if you have prescription - the insurance pays it directly to the pharmacy. But I guess you can't go and get it for free without any prescription in Ireland, right?

It’s free at the point of service in the U.S. as well with most insurance plans, including Medicaid which covers most low income people.

> Healthcare should be free for all, it amazes me that this is not yet the case.

Why are you amazed? It's impossible to provide a valuable product or service for free without institutionalizing either slavery or robbery, and not everyone agrees on that trade-off.

Regardless of where you fall on the spectrum of opinion regarding this, it shouldn't come as a surprise that there are some people with philosophical objections to encoding nonconsensual interactions like slavery or robbery into the fabric of our society.

Many reasonable people agree that providing healthcare (or other important services) for "free" to all people is more important than not having the government rob people to pay for it.

Many reasonable people agree that that is a bridge too far, and that we shouldn't be robbing people, regardless of what the stolen money is used to do.

Both are sincere positions held by sane, reasonable, intelligent, empathetic people.

This is missing the point. The insulin Walmart sells for cheaps is definitely lower quality, which causes serious complications in the long run because it's impossible to _accurately_ regulate your blood glucose levels.

The newer, better insulin costs around €7 (~$8.50) per pen in Europe. That same pen costs $180+ in the US. The markup these companies charge is criminal.

Willpostforfood’s point was that “insulin” is not an old drug, as there are many forms of it, and some are new.

Exactly, and that the Walmart version is not "low quality". It is the older formulation. The newer better insulin analogs aren't the same old drug, but priced up. They are new, different drugs that are better.

Quite the opposite: drug regulation in the USA makes it criminal for people to sell the European pens in the US.

The status quo isn't criminal: changing it to make things cheaper and more efficient is.

Have you studied healthcare/drug distribution in other countries? If so, could you identify things that work from those examples, and comment on why the USA lacks those characteristics, and how your new venture might go some way towards making amends?

The US is kind of unique in a lot of its healthcare dysfunctions and there are a lot of individual policies that might help.

For example, one thing most other developed countries do is have a central state agency negotiate prices for drugs for the whole country at once, which exerts a lot of buying power to drive costs down.

The idea of Medicare in the US doing that has been proposed several times, but has been blocked, most famously during the initial ObamaCare debate.

The stated reason for blocking that is that decreasing reimbursements would decrease the profit motive for pharma companies to innovate and create new drugs. The more practical reason is.... probably just that lobbyists exist.

But that is just one policy among many. We are simple folk here at the MCCPDC, we just charge less. :-)

Hey Alex,

I’m the Founder of mailmyprescriptions.com (now rebranded as geniusrx.com) the second online pharmacy / first wholesale online pharmacy (similar cost plus model) - just sent you an email. Love what you guys are doing, would love to help. Keep driving those prices down!!

The website says you're planning to build your own manufacturing plant. What will that plant do? Will you actually be manufacturing your own medication?

If so, would that include manufacturing the active pharmaceutical ingredients or will you be sourcing them from generic manufacturers and then making the final drugs at your plant?

It will be a sterile fill-finish facility. The facility will fill vials of sterile injectable medicine. Those tend to be the drugs which are most affected by shortages and price gouging overall. The facility will just do finished drug products.

Our initial drugs are supplied on "private label" arrangements where other companies actually do the manufacturing, and we just add our labels and our own NDC code so we can set the price. Since we don't go through middlemen, that price can often times be a lot lower.

We'll have to source API (active pharmaceutical ingredients) elsewhere for now. At some point, would like to completely internalize our supply chain, but one step at a time. :-)

I know this is crazy, but have you talked with Bill Gates?

He planned to pre-fund several coronavirus vaccine manufacturing plans _prior to FDA approval_ just to speed up vaccine production. He expected several of those would end up being wasted money. [1]

Perhaps he would find this valuable too?

[1] https://www.weforum.org/agenda/2020/04/bill-gates-7-potentia...

Hi Alex, I just want you to know, I really admire what you're doing, and I hope you're wildly successful at it!

Thanks Benjismith!

If I'm understanding correctly, once a drug patent expires there are 2 possibilities:

1) The FDA grants a single company the exclusive right to manufacture, distribute, market and sell a generic version of a drug. In this case, the price will be lower than the brand drug, but not by much, since there's only one maker and no competition.

2) Several drug companies are allowed to design their own versions of the brand drug. Because there are several competing brands with essentially the same product in the marketplace, competition causes the prices drop.

If your company targets the first type, you replace another company as the sole producer of the generic, and there's still no competition to drive the price down.

If you target the second type, you become an additional competitor to the other generic drug makers, so the market gets a bit more competitive, but the prices in theory were already competitive because of the number of makers. For example, the Lexapro generic Escitalopram has many makers, so you can get it for as low as $10.

So in terms of generics, the options are either single source agreements where pricing won't be competitive by design, or multiple makers, where the pricing is likely already competitive. Having said that, which of those does your company want to target, and how do they plan to tackle it?

If they target the first type, won't there be TWO competitors where there used to be a monopoly? Shouldn't prices then come down? As to the second type, just because there's an oligopoly doesn't mean competition will ensue and prices must drop. Look at the insane price on insulins.

I suspect their intended mission is to cover their costs with only a modest profit and thereby drive down prices where they are most inflated.

Given the proliferation of people like Martin Shkreli and companies like Purdue, there's a lot of pharmaceutical fruit out there to be pulled down and made low hanging once more.

I don't know if this question was asked before the question was asked upthread ("how do we know you won't cave to investor pressure to raise profits?", basically) but the answer was that they're chartered as a "public benefit corporation" and that comes with a legal requirement to "maintain the social mission". So, if they're targeting the first type, the theory is that you don't need market pressure to drive the price down because they're only "allowed" to make enough margin to cover expenses.

Excuse my ignorance of all this:

I'm assuming most drugs are priced high to start due to the R&D costs, and (I hope) they eventually decrease their costs over time as that's recouped.

If Cost Plus comes in and reduces the costs significantly, then the original manufacturer has no incentive to create these medicines to start.

Or is that not at all how this works :-)

You’re on the right track, but there’s a big difference between under patent and post-patent expiry drugs. Patents last 20 years, so if you invent a drug, patent it, then go through FDA approval, you can charge whatever price you want to recoup development cost until the patent expires. After the patent expires other firms can make ‘generic’ versions of the drug without having to license it. The goal with generics was traditionally take expensive patent drugs and make them more affordable while still retaining reasonable profit - in theory multiple drug makers would create an efficient market price. However, many generics for critical but low volume drugs have become single sourced, and there has been a move over the last 20 years for single sourced drugs to dramatically raise their prices and bleed insurance companies and the unlucky individuals that aren’t covered by insurance. This is what MCDC are fighting.

That's the first approximation estimate, But drug production requires a significant fixed investment to build the "factory" for the drug in the first place. Drugs with crazy prices tend to be those where a rational actor would choose to invest in a safer investment instead of expanding the supply, because they are being priced by people who are smart enough to make sure that is true.

Hey, I wrote about monoamine oxidase inhibitors on Scott Aaronson's blog a few months ago: https://www.scottaaronson.com/blog/?p=4933

Basically, there's is an international shortage for one of the most effective treatment for severe depression because of an unfortunate series of events, the drug's long history as a generic and the manufacturers' willingness to replace the drug class, and constantly produce new patented molecules with chemical tricks(ex. just taking one isomer in the citalopram->escitalopram case, or even metabolites in the case of venlafaxine -> desvenlafaxine case) like they are 'annual smartphone model releases', except efficacy even goes down.

You can read more about it the drug itself on the blog of Scott Alexander (the rationalist/Bayesian psychiatrist guy) as well: https://slatestarcodex.com/2015/04/30/prescriptions-paradoxe... And now some years down the line after his observation, the price has exploded, very few new patients get a prescription due to uncertainty and there's no alternative. Your options are either taking taking an atypical antidepressant like vortioxetine or an experimental ketamine.

> monoamine oxidase inhibitors > citalopram ... venlafaxine

God I hate myself for being that guy, but neither of the drugs you’ve listed are actually MAOIs. I’m sure the point still stands though.

That's exactly the point. The selective classes (SNRI/SSRI) are marketed as a complete and safe replacement for MAOIs, on top of the chemical structure irony. Even the new atypicals with innovative chemical structure (and targets other than 5-HT1/SERT) are of significantly worse efficacy MAOIs

I'll edit my parent comment to make it clearer.

I don’t quite get the point you’re making then, as there’s a lot of generic citralopam on the market, despite escitralopam being patented.

selegiline is cheap. Rasagiline is available but I suspect cost inflated. However, I don't think either are targeted at depression, esp at the doses available.

Those are MAO-B inhibitors; i think the thread was referring to MAO-A inhibitors, which are the mechanism for depression.

I supposed I should have read it more carefully. It refers to phenelzine which is...both. It's nonselective so it's an A and B inhibitor.

How good is it, I cannot say as not a lot of people prescribe it anymore. The problem with it is that a risk of hypertensive crisis, especially in combination with tyramine in aged foods, or inducing an overload in combination w/ any other drug that raises monoamine neurotransmitter levels, i.e. SSRI's etc. It's become kind of a bogeyman. So the original source seems to be trying to fight that particular "meme" in medical education. I'm not about to wade into pubmed regarding how often hypertensive crisis happens in a 60 or 70 year old drug, but there may be a point in that as medical students, we memorize the "quick bites" of some of these things as our time and attention is extremely limited in figuring out what to study for the boards. and if we do want to prescribe it, we have a pharmacist pushing back on the other end of the phone because it has this thing as a big scary Black Box Warning on the drug.

I will say, MAO-B inhibitors (at least those studied in anti-parkinsonian trials and doses) don't seem to do anything. No hypertensive crisis, but we haven't been able to see a huge therapeutic effect either. The psych people dose them at 6 times the parkinsonian dose though...<shrug>

The other potential angle on that post is...this may reflect on some aspect of an unregulated generics market. Aside from phenelzine, I seem to see weird swings in availability and pricing of generics in the past few years.

Excellent project! Do you guys plan on making insulin more affordable in the US?

Or epinephrine (e.g. EpiPens)?

Awesome project!

What is the stack, what kind of developers are you looking for?

Maybe post a link to your job listings.

Currently our frontend is react, backend node.js, and a MySQL database with a graphql API (edit).

Would be looking for folks to help make a more robust consumer facing site as we add products and different types of customers.

We've been focusing mostly on filling roles for the sterile fill-finish facility we are constructing in Dallas (QA, formulation specialists, etc.) and have put building out the dev team for the web sit kind of on the backburner with me just kind of personally managing it at the moment.

While Hacker News is looking though... :-)

Why do you need a graph database to run a drugstore? You will save hundreds of thousands of dollars in development if you just use postgres...

GraphQL is not a database it’s just a wire protocol. You need a database behind it and Postgres is quite common.

Compare it to JSON:API or GRPC.

With Apollo it also solves a lot of frontend caching and state management problems so you can somewhat use it as an alternative to Redux.

He probably meant a Graphql API in front of the DB (e.g. Hasura)

Oops, yeah sorry. Graphql API in front of MySQL

O should also point out, these roles can be remote

Not a question but a request: might not be a massively used drug, however pharmacies where I live don't seem to even carry the generic version of it, but dopamine agonists could use some competition.

I would love to help as a software developer but I'm super busy with school and my PhD studies. Best of luck! Please make the repos publicly available so we can contribute for the greater good.

how can you compete with generics giants such as Teva, or even the entire Indian industry?

Hi do I have the ability to invest/buy stock of your company?! I am a huge fan of shark tank/especially Mark Cuban and would be excited to play a part in a company he also believes in. Even if it's just a miniscule role.

Thank you!

How will you avoid shortages, when the returns to drugs with chronic shortages are no better than those to drugs with plentiful supply on the market already?

What do you mean by "monopolistic middlemen"? Who are these people and how do they manage to make drug prices higher?

Short answer... it's complicated. And it's intentionally complicated to make it difficult for people to understand how they are getting ripped off on the price of drugs and by who.

Here's a brief video that breaks down some of it though: https://www.youtube.com/watch?v=15IQO_jTMUM

Congrats on the launch Alex - very happy for you and everyone you will be able to serve! /Gustaf

Is this a for profit at the end of the day?

And can you export the drugs to other countries (for sale)?

Are there any non-dev, remote roles needed?

Do you check for impurities in the drugs? One of the biggest issues these days is impurities of carcinogenic chemicals in many of the generic drugs.

If you are referring to the issues with Ranitidine, it is erroneous to consider that a generic drug problem. Research has shown that the NDMA is a degradation product of the drug itself and that the brand of the preparation does not affect it.

Maybe for ranitidine, but for the ARBs (common blood pressure treatment drugs) that are a few decades old, the NMxA source was sourced from a new synthetic route and that's when they appeared in the drug supply: "It believes there has been NDMA contamination in those drugs for up to four years."

https://www.lexology.com/library/detail.aspx?g=fcf817fe-192b...

> Ultimately, scientists traced the contamination back to a change in valsartan’s synthesis. The antihypertensive drug contains a tetrazole ring, which is an aromatic five-membered ring with one carbon atom and four nitrogens. For many years, the synthesis for this compound, developed by Novartis, used tributyltin azide to form the tetrazole, with xylene as a solvent. However, in 2014, China’s Zhejiang Huahai Pharmaceutical, which makes valsartan for some companies, filed a patent for an improved method for forming the tetrazole ring.

https://cen.acs.org/pharmaceuticals/pharmaceutical-chemicals...

It's not just Ranitidine.

It's all blood pressure medications like Valsartan, losartan and irbesartan, and metformin the diabetes drug.

These are just the ones that have been tracked. Sometimes the drugs come in with higher doses than they should, or less than they should. Or sometimes the pills are mislabeled.

What's the tech stack?

Why not make a website that doesn't require Javascript?

I love those kinds of sites. But realistically the main reason people don’t build that way is it’s harder to hire for that.

Really? Am I somehow worth more by not knowing React?

If you apply to jobs where the stack advertised looks like it's from a decade or more ago, you might have to actually deal with technology from two to three decades ago (or not, but it's probably more likely). People like new things, and often switch jobs looking for something new, and in tech that's often new technology they've played with but not got a chance to use in production.

Honestly, something that's advertised as ruby/python and HTML will probably put a lot of devs off that used to happily do that all day, and so a company might have to pay higher for good talent, or put up with worse talent applying for the same salary.

You might actually be worth more not knowing react. Communicating that to prospective employers might be hard though.

In other words, you can probably make really good money slinging COBOL if you know it and can communicate your talent sufficiently for the same reason, but more extreme.

You wouldn't be worth more as a carpenter if you didn't know how to use a hammer.

(I'm not saying React is as useful as a hammer, but if it genuinely makes building and maintaining websites faster, it's a skill worth paying for).

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