It seems to me that US people have been sold FUD by there own pharma companies, if I’m honest.
Most novel R&D, in America and Europe, happens in biotech. (“Big” pharma does trials, manufacturing scaling and distribution.) The investment thesis for most of this research does not work without the American market.
This doesn’t mean high drug prices are a necessity. Just that the funding needs to be replaced if we want to preserve innovation.
That's not really on Europe though. It's for the US to sort out it's horrifically dysfunctional health care system, if it chooses to. Honestly I don't know if what Biden plans to do, particularly in relation to Big Pharma is reasonable. I suspect it's likely to be treating the symptoms with regulation rather than the disease through reform, but maybe that's what you do when treating the disease runs into insurmountable political resistance.
They have the advantage of pushing through Clinical trials without much oversight.
I am all for strict Clinical trial protocols, but our biotech companies are testing their drugs in countries that don't have strict protocols on safety.
I don't get the price increase argument anymore. The biotech companies are multinational. It's just Americans give them the most money.
I'm getting afraid of the whole, "American biotech will cure anything because of the financial perks they get" mantra too.
I pay out of pocket for my needs at Costco. Their prices are a bit above wholesale. That said, I pay way to much for certain drugs. I guarantee their are shinagigans going on in the pricing if certain drugs.
Bupenorpine us a generic drug. Why gave I been paying $70 for a decade?
(This drug is America's answer to the opioid crisis. I was prescribed this drug off label for another condition. It's the price that has me scratching my head. It's been the same price for too long. Other pharmacy's price it higher.)
I won't get started on the drugs (new--not genetic) prescribed for depression. And then reading Irving Kirsch's research. His paper can be found, but you need to hunt for it. I'll offer this interview.
https://www.aarp.org/health/drugs-supplements/info-05-2010/d...
I am proud of Biden's promise to lower prices. I am so glad he's at the helm. I'm not being overly political. I just am just at bit hopeful now. Something I haven't been in 4 plus years.
And China and Russia are not "making big breakthroughs": just look at the vaccines again: BioNTech/Moderna/J&J/AZ all work extremely well, all things considered. The Russian and Chinese vaccines don't. Just ask/look at the charts of Chile. Or any Russian.
And it's a real working vaccine, effects of which I see basically every day on my friends.
It is better than nothing. But it’s a far cry from the best vaccines (Pfizer, Moderna, and to a lesser degree, AstraZeneca), which protect against novel variants and can produce some level of herd immunity.
This isn't an advantage. What you end up with is a lack of clarity on what works well, what doesn't, and why. It makes it easy to go from A to B, a hypothesis to a drug, but it clouds what C, D, and E should be, as that lack of oversight turns into a lack of deeper insight.
The main value proposition of big pharma is that they take those results, find the ones that actually work (very few of them do), study them for side effects, and characterize them. There is a LOT of work between the published research and an actual drug (there is actually significantly more risk and cost to go from a paper to a drug than to write the initial paper).
Spending money on marketing lowers prices by increasing volumes.
If you spend a billion dollars on R&D and then spend nothing on marketing and sell to 200,000 customers, they would each have to pay $5000 to fund the R&D. If you spend a billion dollars on R&D and two billion dollars on marketing and sell to a million customers, they would each have to pay $3000 to fund both the R&D and the marketing.
And it also does something useful, assuming the new drug is actually beneficial, by making people aware of the existence of something that would make their lives better. It helps no one to invent a great new thing that then nobody uses because nobody knows it exists.
> And a huge chunk of that R&D budget goes into analogue drugs to either sidestep patents from rivals or maintain profit margins when their own patents expire (they can then use that huge marketing budget to get the newly patented drug to take over for the old one with the nearly-expired patent, despite small or non-existent benefits from a medical perspective).
It doesn't actually cost that much to do that because you already know what you're looking for in that case. It's the real R&D that costs money.
> So long story short, there's a pretty good case to be made that public research with somewhere between 1/10th and 1/5th the budget of big pharma is all it takes to match or overtake them in innovation, as measured by actual benefit to the patients.
The biggest problem with public research funding is how to allocate it.
With a profit motive and market competition, the people who allocate research funding inefficiently go out of business and the people who allocate it well make a lot of money, and then have more money to fund more research.
Without that, research funding turns into defense contracting and then we waste trillions of dollars and have nothing to show for it. Or worse, politicians say we'll only need 1/10th of the budget even though the incentives aren't actually there to improve efficiency, and then we get 1/10th of the research.
That explains why they do it, but not why it's useful to the public. Marketing isn't necessarily a zero sum game, but it in the case of direct-to-consumer drug advertisments, it's pretty close.
Do you have any proof of this - had you said it increases profits - I'd have readily agreed with you.
> If you spend a billion dollars on R&D and then spend nothing on marketing and sell to 200,000 customers, they would each have to pay $5000 to fund the R&D. If you spend a billion dollars on R&D and two billion dollars on marketing and sell to a million customers, they would each have to pay $3000 to fund both the R&D and the marketing.
Or, in line with their "fiduciary duty to shareholders", the company still sells at $5000 to a million customers: see Martin Shkreli, Epipens, or dozens of other real-life examples that prove your lower-price hypothesis wrong. Without competition, drug manufacturers have no incentive to lower prices when they can make more profits instead.
For a market like pharmaceuticals where patients are prescribed by Dr's and are going to be subscribed one thing or another regardless, the lack of any marketing wouldn't really reduce the amount of volume in the industry as a whole, might just switch around which drugs/companies it goes to.
Biotech/Pharma are international. Irrespective of the home location of the organisation, virtually every drug trial from phase I onwards will be run in multiple countries. Further, virtually every drug found to work and filed with regulators for a license, will be filed internationally: Europe (EMA), US (FDA), and a whole host of smaller independent country regulators: Japan, Australia, Switzerland, etc.
So within the overall business model of a given company, there’s no link between the countries in which research is performed, and the prices ultimately set in those countries.
Drugs are more expensive in the US simply because there aren’t any pricing controls (beyond maybe some bargaining by providers; I can only assume this is because of the power of lobbying over the political process in the US). Drugs are cheaper where there’s an established process for determining or controlling prices.
There aren't any other markets where "pricing controls" are needed. Drugs are more expensive in the US simply because it is illegal for a 3rd party to sell them.
If it were legal, anyone could buy the drugs where they are cheapest and ship them to America. The problem is obviously that competition is banned. If that isn't the problem, the entire population of the world is remarkably indifferent to a really easy opportunity to make lots of money.
And, I suppose almost to obviously to add, if competition is illegal then prices go up.
When I used the term ‘pricing control’, I was referring to the systems that some countries (eg UK, Germany) have in place for determining the price they’ll pay for a drug based on (roughly) the value it brings to patients. (The best known of these is probably NICE in the UK; it’s not a perfect system, but it’s a pretty good attempt.) Other countries in turn ‘reference’ their price from a number of similar countries including those with formal processes.
Broadly, this is why drug prices are controlled and lower in Europe vs. the US.
In the US, even where there are competing drugs in the same disease, there’s no pressure on prices - manufacturers can just keep on racking up their prices almost without a concern.
If that was legal, someone would do it and make bank. And it is the US that is responsible for those laws.
Ever wonder why it’s the Pfizer-BioNTech vaccine? It’s because the simple nationalist narrative you’re repeating is misrepresenting a far more complicated international research story.
Every European drug firm also sells in the US, so I suspect that's taken into account in their business model