California aims to make its own insulin brand to lower price | Hacker News Reader

California aims to make its own insulin brand to lower price

apnews.com

37 pointst_a_v_i_s29 comments

Previous discussion: https://news.ycombinator.com/item?id=31649237

I think my comment there still applies. There's a simple way to buy insulin for 10x cheaper: Drive over the border. Any border will do. The extremely high prices are unique to the United States. Other countries have the same insulin brands, from the same companies, at literally 10x lower prices.

That should make the solution clear: Undo the laws that prevent retailers from driving over the border themselves. If US drug stores could import insulin from Europe, Canada, and Mexico, then it would be impossible to maintain such a large price difference, and the US price would come down.

Are these other countries producing their own insulin? Or importing it from the US?

I can imagine pharma companies retaliating against, say, Canada, by refusing to sell Canada insulin (or only at US-equivalent prices), unless Canada bars export of insulin to the US. Maybe the pharma companies would blink and not murder a bunch of diabetics? I'm not so sure about that; I have a hard time believing that the execs have souls.

Still, I agree we should allow drug import. The FDA is totally captured, though, so they'd try to block it. And there's no will in Congress to do anything - see the EpiPen pricing scandal.

Small problem; that doesn't reinvest money into California's economy.

They are, will be, contracting with established companies. It's a good way to go. Pharmas have found out that they can buy a company that makes an established med and hike the costs of the med since it's the only med available and it's very expensive for new competitors to come in. Martin Shkreli got in trouble for trying to do that but it has been an established way of doing business for a long time. He didn't invent it. Other CEOs have gotten rewarded for doing just that.

I hope California can show that government can come in and help with the situation since the free market is only making it worse.

Legitimate question - how is the state allowed to compete with private merchants to sell a product?

It is a market that is likely going to have multiple competitors with the patent expiring, and those competitors are not likely to succeed if they compete against a state with a bottomless pocketbook. It appears likely this would result in less competition and - over a long run - higher prices?

Not trolling, I am genuinely confused how this is supposed to work.

The same way its allowed to provide any other product or service, like security (police), transportation (roads), etc.

There is no reason it can't offer other things, and often in many other places, do. The state is perfectly capable of doing things effectively, but we've conditioned ourselves to believe it can't because corporate America has wanted it that way due to the sheer terror of being out-managed by the state/municipal option (they can't gouge as flagrantly or impose endless layers of their own bureaucratic middle men, so they accuse the government via the dumbest projection).

The state sucks for many reasons, but often for the same reasons corporations do; bad leadership and defection from purpose, often in the process of avoiding transparency. Either can suck, and picking one over the other just because of an ideological crutch is daft.

To be fair, in most cases private industry can produce far more efficiently than government. Healthcare in our country is so screwed up that it may be a glaring exception.

Private industry seems best for things with no natural monopolies and high demand elasticity. Natural monopolies: you get Comcast, low demand elasticity: you get US healthcare prices.

Heres an example of private contractors for city services going for $21m while the city realized they could do it for $7m.

Turns out regulatory capture is great for middle man but horrid for costs

https://www.ajc.com/news/local/sandy-springs-amid-reinventio...

"private industry can produce far more efficiently than government" and yet often chooses not to, because profit does not efficiently produce gains to customers as much as "stockholders" today, and healthcare is far from the only glaring exception, its just the most terrifying to most people.

And 'efficiency' isn't the sole determinant of value.

The state of California is simply another entity in the market. As long as they don't use illegal means to establish market position (i.e., coercion, etc.), there are no laws against them competing with private markets.

And in this particular case, the reason that California is jumping into the market is because the private merchants have artificially increased prices to pad their profits and pay their executives, at the expense of thousands of people who are now struggling to afford an essential (and a historically ridiculously cheap) medication.

If you’re referring to financial cost, it’s not at the expense of thousands, it’s at the expense of millions of diabetics in the US. (1) (2)

Unless of course you mean the expense of thousands of dead or permanently disabled diabetics, that is the correct ballpark! (3)(4)

(1) https://www.diabetes.org/about-us/statistics/about-diabetes

(2) https://www.forbes.com/sites/debgordon/2022/06/20/4-out-of-5...

(3) https://www.cbsnews.com/news/insulin-prices-2019-diabetes-ra...

(4) https://www.reuters.com/world/us/exclusive-us-diabetes-death...

I was specifically referring to CA taxpayers, not the entire country, as the CA insulin would only be available to CA residents initially.

Thanks for clarifying! My point sadly still stands when looking at just California.

California has about ~2 million diabetics (1) and even when factoring in type 2, most of them (2) will require insulin at some point. The scale is still in the millions.

(1) https://www.cdph.ca.gov/Programs/CCDPHP/DCDIC/CDCB/CDPH%20Do...

(2) https://pubmed.ncbi.nlm.nih.gov/25451189/

> The state of California is simply another entity in the market.

Well, no, it's the state government. It has powers that it absolutely can use that other market participants cannot.

> As long as they don't use illegal means to establish market position (i.e., coercion, etc.), there are no laws against them competing with private markets.

State governments, acting as sovereigns, are immune from federal antitrust (Parker immunity doctrine), and can, therefore, use what would otherwise be illegal means (including coercion) to exclude others from the market.

No, by definition those means are not illegal...

And the state could alternatively pass laws regulating private behavior. But sometimes having a state agency instead of a law is the less burdensome option.

The state does many things that could theoretically be provided by private companies. The state also does not exist to serve companies and the richest, it exists to serve all the people equally. It often goes the other way around, which is just accepted as normal.

Cynical take would be it's pretense for future nationalization of industry.

The prison industry would be a good start. My point is that the US in little danger of the state nationalizing industries, but there are real cases of privatizing state functions.

excellent thought friend

It would not work. At all. No where in the world does it work, nor has it ever worked.

It is just politics... Semi communist statements like that can gain traction in California, so they are uttered. It will not happen, but will spur another round of talks about how great state is, and what ifs

The state of California producing insulin won't work? Why the hell not? They can buy all the equipment from private industry, run it, and make a non-obscene profit. Or not, they don't need to. Taxes are spent on much worse things.

This is how Europe works. And it works well, and the reason the US pays WAAAY more for items like this. The US also allows price gouging of course..

No sympathy for those who want to gouge ill people. About time, I hope the rest of America gets to buy cheaper insulin. Saying otherwise is a disgrace

Your idea of Europe is wrong. Where do you get this information from? Europe likes a lot more free markets and is a lot more conservative then that Americans try to paint it while having their own politicial wars.

This is not how Europe works... Misconception no1: Denmark has no minimum wage. We rely on market forces.

It is truly terrifying to see how the narratives about Europe, and especially my home country, have infested the internet to a point where young people in Denmark actually believe random foreigners online know more about Denmark than their parents.

Is Denmark representative of Europe?

Find the person that wants to mimic the Greek healthcare system and not the Danish.

I’ve never heard of a European healthcare system mass producing its own medication (except in communist countries and their remnants). European healthcare systems achieve lower prices through bulk orders and using the massive market to negotiate lower prices.

> through bulk orders and using the massive market to negotiate lower prices.

Although through regulatory pressures: "if you're too expensive we're not approving you"... usually works.

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