Comment by tadfisher | Hacker News Reader

Comment by tadfisher | Hacker News Reader

The failure at every level here is astounding.

1. The pharma company selling Unisom+B6 for $800, with the FDA apparently not batting an eye. I mean, these are OTC substances, so it's probably safe for consumption, but still.

2. The doctor prescribing an $800 drug with two known, cheap, OTC ingredients. Probably receiving kickbacks.

3. The pharmacy accepting the prescription and billing insurance for a bullshit drug without informing the patient of an OTC alternative, when anyone who is licensed as a pharmacist knows the drug is Bullshit with a capital B and would save the customer $777.50 in needless expense.

4. The insurance company denying coverage, presumably with a form letter, without telling their customer about the OTC alternative.

What's to stop me from creating a pharma startup marketing a combination Vitamin D and acetaminophen as a treatment for back pain, selling it for $1000, and blasting doctors' offices with cold calls? Not our government(s), apparently.

Comparison with Japan:

1. The price of drugs are regulated. There is no chance such a bullshit drug just combining OTC ingredients are allowed to be sold with such a high price.

2. Since there is no bullshit expensive drugs, doctors don't need to worry about it. Rebate is prohibited, but even if it exists, you can't prescribe the drugs you can't use.

3. I'm not sure about the quality of pharmacy in Japan but they regularly call doctor when they have concerns about the prescription and they switch to generic drugs on default unless patient strongly object not to.

4. Universal Health Care. The govt regulate the insurance so it's either all covered by insurance or nothing.

How many new drugs is Japan developing? From what I can tell, a fraction of what we do. The free market is pretty damn good at that.

The US pays the most for healthcare for worse outcomes. Free market not doing so great. An expensive new drug is not necessarily an effective drug, nor is a free market required to innovate. The US imports a very effective lung cancer immunotherapy vaccine from Cuba, for example (CIMAvax EGF).

https://khn.org/news/article/medicare-ruling-aduhelm-controv...

https://hbr.org/2021/10/the-u-s-can-lower-drug-prices-withou...

https://en.wikipedia.org/wiki/CimaVax-EGF

If it's so good at it, why does it always need government funding?

(As testified before a congressional committee by an FDA official, his response to the question of "how many drugs receive government research funding?" was "all of them.")

> why does it always need government funding?

Where is the "always" coming from? Check actual clinical trials registries and you will see that most clinical trials are not funded by the government.

Not all clinical trials are done just to get approval to sell. Some are exploratory, or to create datasets for meta-analysis/other research.

Previous post mentioned "always" and your answer is "some", so I guess my point was right?

> so I guess my point was right?

No, it was not.

US Tax Dollars Funded Every New Pharmaceutical in the Last Decade:

https://www.ineteconomics.org/perspectives/blog/us-tax-dolla...

How many new drugs rely on government-funded science? All of them:

https://www.cbc.ca/news/health/drugs-government-funded-scien...

That's a very biased way of looking at things, because you don't seem to understand how the research is organized in the first place.

The industry works all the time with academics. Academics do the fundamental science labor, which means identifying new targets, new pathways, new proteins and so on. This kind of research is indeed usually funded by a combination of public and private grants. Most of that research leads to nothing in the end, by the way - not everything they produce is picked up by the pharma industry, because most of what they produce fails to give results - that's the inherent property of doing fundamental research.

Then the industry purchases/licenses (and patents) what is considered to have the largest commercial potential - then pre-clinical, phase 1 up to phase 3 are mostly funded by the pharma industry. This is also where the bulk of the cost is. A clinical trial in phase 3 can costs in the dozens of millions of dollars, and there's always a solid chance that it fails to meet its endpoints so the risk is far from nil.

Based on the NIH numbers, the funding for research (i.e. grants) is about 45 billions annually. At the same time, the pharma industry spends 87 billions per year on R&D, which is about twice more.

Ouch. That’s outrageous.

Those drugs still get sold in Japan. It's just the American patient/taxpayer who gets the honor of paying for it.

The important metric here ahould be average health of the population, not total number of new drugs developed.

I dont have those stats handy, but given how unhealtht the American population is as a whole I dont expect that we'd end up on the better end of that comparison.

> How many new drugs is Japan developing? From what I can tell, a fraction of what we do. The free market is pretty damn good at that.

Japan actually has a bunch of fairly major pharma companies that develop a lot of new drugs. You just don't hear their names in the US because the drugs get licensed to other companies when they're sold in the US and you only hear the name of the company that licensed them, but there are plenty of drugs that are commonly described in the US that were developed by Japanese pharma companies.

Local drug price regulations actually don't necessarily affect drug companies in a given country that much for this reason (they don't just develop drugs for the domestic market, and licensing to other countries to sell internationally is pretty much the norm).

However, in the case of the US it seems like the US pays a disproportionate amount of the total costs so it's possible that US drug price controls would affect pharma companies worldwide more than other countries' drug price controls. I'm not sure whether or not this can really be described as the free market doing a good job or not since the location where drugs are developed doesn't really affect their availability in other countries.

> 1. The price of drugs are regulated. There is no chance such a bullshit drug just combining OTC ingredients are allowed to be sold with such a high price.

Wrong, the drug pricing in Japan is not based on the ingredients itself, it's based on what you can prove as an indication for a specific disease. Does not matter if you can mix off the shelf drugs to get the same drug. For example there are painkillers with prescriptions that contain the same drug than the OTC versions but are sold at a more expensive price.

> Since there is no bullshit expensive drugs,

You seem to have no idea what you are talking about, sorry, There are drugs that cost more than 1000 dollars per injection in Japan as well, and that are reimbursed. Oncology is full of such drugs, look at the highest pharma revenues in Japan, they are all coming from companies focusing on oncology.

> Rebate is prohibited

Rebate is happening between wholesalers and hospitals, and it's not unusual, it's the de-facto mode of operation in Japan.

> they switch to generic drugs on default unless patient strongly object not to.

Depends, if the doctor has prescribe the drug with the commercial name the pharmacist can't switch you to a generic. And generics are not equivalent to the original drug - the formulation matters, not just the active ingredient.

> The govt regulate the insurance so it's either all covered by insurance or nothing

You still have to pay out of pocket in Japan, while it&'s a fraction of the total cost (30% for regular employees, 10% for elderly people). It can still get fairly expensive if you add hospital nights and all. That's why you also have additional private insurances in Japan to get higher levels of reimbursement.

Agree with some of your points but you are missing something essential here.

You don't pay for the cost of the ingredients in pharmaceutical products (otherwise the cost of most drugs would be 1/10th of what they are or even less), but for the IP behind it. You need clinical trials to demonstrate that something works for a specific condition, and this is what gets an approved stamp by the FDA and integration with the reimbursement system, along with a negotiation on pricing.

If there were no such incentives, then nobody would do any kind of clinical trial for compounds that are already widely available in OTC form, and the only thing you would have is anecdotal evidence (i.e. noise) to know what works or not.

Whether this is the right way to incentivize research and development is a valid topic to discuss, however.

To be fair its not so simple. You fund the clinical trial perhaps, but you also fund shareholder profits. This incentive model is actually pretty perverse because there are diseases that aren't seeing drugs developed because they are so rare that a treatment will never be given to enough patients to turn a profit. A better incentive model is to have the government identify diseases that lack a solid treatment option and fund clinical trials through direct taxation versus profiting off of the sick or abusing the for profit insurance process to cover these huge fees.

> A better incentive model is to have the government identify diseases that lack a solid treatment option and fund clinical trials through direct taxation

The government is the worst tool for this job, because they would need to hire external experts to assess which disease should be studied, and those experts would be already in bed with the industry for a long time. You would just be diverting tax-payer money in a different way.

How do you think government research money is currently directed? Sure you get people from industry but you also get people from academia and government as well filling these positions. That's basically anyone with domain knowledge. Sure people can be corrupt and evil or whatever, but that's why you have other checks in your system to deal with it. If you think it can't be done just because 'government', that's not a strong argument because literally any sort of person in any position in any org, public or private, could be corrupted, and the race to the bottom of this logic is to trust nothing and no one.

>The government is the worst tool for this job, because they would need to hire external experts to assess which disease should be studied, and those experts would be already in bed with the industry for a long time.

There's no need to "hire external experts". They could have their own pool.

Like the FDA? We see how well it works...

Well, other countries managed to solve it, as they've managed to have schools without shootings, cities with public transport, no gerrymandering, and so on.

So it's not unsurmountable, just badly done...

other countries fail at research. there is close to zero new drugs that are not developed in the US

You'd be surprised, especially since most of the "new drugs developed in the US" are crap consumer oriented drugs with no real medicinal value (a trillion snake-oil industry) and differentiating qualities, and reiterations of existing stuff to get new patent leases...

Even so,

https://www.iam-media.com/article/switzerland-once-again-nam....

> "new drugs developed in the US" are crap consumer oriented drugs with no real medicinal value (a trillion snake-oil industry)

This is true to some extent (not all drugs approved require more than just superiority vs placebo), but that reads like throwing the baby out with the water. There's a ton of great drugs developed every year that are clearly very innovative in terms of mode of action, and by far and large those come from the US.

Where does this hate from government Congress from? Government funded research is how a lot of research is done in Europe. If you saw these academics and researchers salary you would laugh, but still they produce stuff without being in bed with anyone.

The vast majority of new drugs in the US research was funded by the taxpayer.

Innovation comes mostly from the public sector, not private sector. This applies equally to technology.

Private-led innovation is hyped by these industries PR departments. DARPA, NASA, NIH don't have a PR department.

References: 1/ Overall, NIH funding contributed to research associated with every new drug approved from 2010-2019, totaling $187 billion." (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3731819) Search Mariana Mazzucato talks, books on innovation, example: https://www.noemamag.com/big-pharma-is-hurting-drug-innovati...

2/ "Apple Didn’t Build Your iPhone; Your Taxes Did": https://www.pbs.org/newshour/economy/the-entrepreneurial-sta...

3/ 97%-99% of Astrazenneca covid vaccine research was public+charity funded( ref https://pubmed.ncbi.nlm.nih.gov/34937701/ )

> Probably receiving kickbacks.

In the best case scenario. The more likely, and actually worse scenario, is that they have no idea either.

Doctors get "free samples" all the time, and are so conditioned to receiving "freebies" by drug reps unquestionably that they aren't even aware of their biases after a while.

Comparing to Sweden, 1 and 2 could happen here as well. But since government subsidies costs over 1200 SEK ($120), the pharmacy will always suggest the cheapest alternative (by law). If doctor prescribes something for $2 but an alternative exists which is only $1 then pharmacy will suggest the one for $1.

If we stopped scamming people and did things right the way you described, the system would collapse.

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