Drug Goes From $13.50 a Tablet to $750, Overnight

Politics and religion
282

Our patent system is definitely broken. You won’t hear an argument for me on that.

We also have a problem when generics are being created by companies that actually own the brand name. They’re only going o undercut their brand so much. In the case of the original drug going to 750… they could have made a generic but there was no incentive to do so. The delivery system for EpiPen is patented but the drug isn’t and there is a competing product. What;s wrong with the competing product… oh there have been issues there too.

Link

Look, i’m all for private companies making money, but I am not for evergreen patents, and I am definitely against brand names owning the companies that make the generics. If the private market won’t provide a valid method for generic creation, then that seems like an area we could consider for the public market to take care of. If the patent system were legit and sufficient, and I agree there is a problem there now, that would provide plenty of time for them to have their time with a profit generating product and just realize once that’s over their going to face very cheap generics from public entities if necessary since the shenanigans in the private sector are not fulfilling the function.

283

Nesrie, I’ve not heard any mention of a widespread issue on pharma companies launching cheaper generics to go alongside branded (but patent expired) medicine.

I can’t foresee how it could be an issue either.

Institutional Corruption of Pharmaceuticals and the Myth of Safe and Effective Drugs

There’s surprisingly little written on how the FDA has become co-opted by the Pharma industry.

284

As someone who works in developing generic medicines, particularly drug delivery devices… It sucks, the FDA is pretty hazy when it comes to approving generics that include a new device. As, due to patents, etc, competitors are not allowed to copy the original device design, but are expected to achieve the exact same results. You have to reverse engineer the wheel each time you make a new generic delivery device. It is difficult, which is why so many device-based drugs do not have generic versions.

285

I don’t know how widespread it is but Greenstone was listed as a top generic company… they’re owned by Pfizer. It doesn’t seem right that a brand name should own a generic company like that. It’s just one example I found. I believe there a few others.

In order for our system to really work, and clearly it’s not working that well, we need a strong generic market. The link i mentioned specifically says there is or was a competitor to EpiPen but the FDA would not allow it to be listed a generic to the EpiPen because it’s different. I just want to know if it was as or very close to as effective. If it was, then we’re back to the marketing problem. If there is a cheaper, just as good or like within a couple percentage good product out there, the physicians need to consider prescribing and the patients need to be okay with using something other than EpiPen and not thinking they’re getting an inferior product.

286

That doesn’t make it a problem and you haven’t really explained how it is…beyond that it is.

Own label groceries are usually produced by manufacturers that also make branded competitors (e.g. Walmart Valu boiled rice can be made by Uncle Bens/Mars)

287

You don’t see a problem with Mylan creating a generic for it’s own product? They’re only creating it right now because of pressure from the media and the public. A healthy generic market would have competition against the brand names but not if the brand names are creating competition against themselves.

If a product is selling for 700, and the generic costs maybe 20 dollars to generate and bring to market, but the brand name owns the generic so they sell it for 300… that’s not real competition, that’s just a company creating something to shut everyone else up.

288

You’re changing the goalposts and showing a fundamental lack of knowledge on how competition works.

Mylan also aren’t creating a generic, they’re creating generic labeling for their existing patented product. There’s a difference.

If Pfizer sell for production cost +140^% and their subsidiary generic company sells for production cost +80%, another generic company will step in and sell for +70%. Etc, etc until an imperfect market equilibrium is reached. That Pfizer own one of the generic companies is completely irrelevant in the generic market, it’s only relevant when Pfizer own all the generic companies, or artificial barriers to entry (e.g. FDA’s absurd stance on autoinjector generics) stop competitors from entering the market.

So again, in the former scenario it’s irrelevant that a subsidiary is creating generics, and in the latter the subsidiary has no impact on the barriers to entry.

289

This is why i often don’t engage you Kedaha. You’re just openly hostile and rude.

Mylan came out today and said they would launch a generic to compete with their brand name. I don’t find that an acceptable response because their goal is to half the price of a product that is ridiculous high already. They’re setting the price.

290

Are you sure that’s why? I thought it was because you were too busy running away from all the statements you so blithely make but seem to find indefensible.

You introduced yet another new tangent:

You claim that there is a problem with traditional patent using Pharma companies producing ‘competing’ generics…

I say I had never heard any mention of it being a widespread issue and couldn’t foresee how it could be one.

You change the initial argument to a Pharma company owning a generic company in general, rather than it being about competition.

I say that that doesn’t make it a problem and that you haven’t explained how it does.

You then change the argument again back to Mylan creating an ‘authorised generic’ of EpiPen being bad because it isn’t a healthy generic market and brand names competing against themselves is bad too and it isn’t real competition.

So, your explanation for your original argument is that… ownership of two competing products is a very big issue because the FDA makes it extremely difficult to get approval of generics for combination drug/device medicine?

What does that have to do with Pfizer? How is two products competing in a market worse than just having one? How does ownership of competing products tie into FDA regulatory approval?

Also, it really is just a labelling change. The difference between a generic and authorised generic is that a generic is required to have identical active ingredients while those of an authorised generic is required to have identical inactive and active. AGs are also brought to market extremely quickly via an existing new drug application rather than the generic’s laborious and slow Abbreviated New Drug Application.

291

[quote=“ravenight, post:277, topic:77479, full:true”]
As some of the links above pointed out, the solution is to rethink the patent-protected free market. Companies do need some form of reward for investing research that saves lives (unless the government is going to somehow fund all research)…[/quote]

Again, companies are still making extremely good profits in first world single payer systems (which do pay handsomely for new medicines, just much less than over the counter in the US because they dare to negotiate). The reward is there without the totally free market, and has been for a while. Single payor systems don’t make medicines go free and respect theneed for profit, they just lower them from, say, $84k to $25k per patient (Hepatitis C treatment).

The US has more generic prescriptions (by percentage) than any Single Payer system (84% of the prescriptions are for generics), so that’s not really the key issue.

292

Is the US paying the same price for the generics as other systems?

293

[quote=“Nesrie, post:292, topic:77479, full:true”]Is the US paying the same price for the generics as other systems?
[/quote]

That’s hard to know, they definetely have less volume percentage and less cost percentage, which means they are definitely paying much more for non-generics. 16% of drugs sold in the US account for 72% of the income (non-generics).

http://d3i6fh83elv35t.cloudfront.net/newshour/wp-content/uploads/2014/02/Pharmaceuticals-2.jpg

Back of the envelope calculation missing tons of data (so take with a grain of salt):

If we look at America per capita spending on medicines of around $900, we get the average American spending about $250 on generics a year, but this accounts for 84% of the medicines consumed.

If we look at the OECD20 data, about $500 are spent per capita, or $95 on generics (19%). But this is only 43% of the medicines consumed, so $2.2 per percentage. The US consumes about twice the amount of generics compared to other drugs, so adjusting to that we have $2.97 (US) vs $2.2. A higher price on average, but not significant.

Let’s look at non-generics. In the US a patient spends $650 on non generics, but this is only for 16% of the medicines consumed, or $40.6 per 1%. In the OECD20, we have $405 for 43% of the medicines consumed, or $9.4 per 1%.

So generics is $2.97(US) vs $2.2(OECD20) while non generics is $40.6 (US) vs $9,4 (OECD20). Generics are 35% more expensive while non generics are 331% more expensive. It’s a good thing there so much more use of generics in the US than in other systems. That is, bringing generics to OECD20 prices will result in a 6.5% overall cost reduction in medicines, but will affect 84% of prescriptions, while bringing non generics to OECD20 levels will result in a 50% overall cost reduction in medicines affecting only 16% of prescriptions.

Now, it’s true that these non generic are normally the newer drugs with more R&D (but I maintain there’s still a profit to be made at OECD20 cost levels, or they wouldn’t sell there), so I don’t think it’s so easy as just price control everything like crazy but generic pricing is a very small part of the problem.

294

I wouldn’t think generics would be a small piece for a couple of reasons. Once these patents are up, essentially someone else can try and undercut them. Most US pharmacies are going to substitute a generic automatically in place of a brand name unless the physician gives a compelling reason not to do so or the patient insists. As soon as that generic is on the market, it doesn’t make a lot of sense for someone that will cost say 200 dollars with a 100 dollar co-when they can get a generic for say 50 dollars with a 10 dollar co-pay. If they’re dragging on patents though or are part of the generic piece itself then it seems a little broken to me. Years drag by and there’s no generic or they do it themselves and instead of 50 generic offer like a 150 which is less but not that much less.

I mean why does anyone think the patent system is broken if we also don’t think generics are that worthwhile as a part of the equation? Mylan is definitely getting push-back on this 300 bargain generic option they’re offering which is still considerably higher than what the main brand used to sell. for.

295

Because what you are saying is that the solution for a country that spends much more than any country in medicines and uses generics more than any other country, is to use even more generics. That’s a logical contradiction. There has to be other, easier solutions, given that other countries pay less and yet use less generics. Unless the US is such a special snowflake that what happens in the rest of the world does not apply there.

Also, if generic usage is so high, one has to wonder what’s really the volume of old drugs protected by patents. Of the 16% of non generic medicines many will be genuinely new medicines that do need patents to protect R&D investment.

I mean, I provided the data, just look at it. Generic prescription is already above any other country’s level, yet you think the minor increase to that (because increases have to be minor at those levels) will make a significant difference?

Generics are a worthwhile part of the equation. But it seems the US is already using them pretty well (they will help lower pharma costs in Spain, though, with only 34% of generic prescription).

296

Well if the brand name is under patent longer than it should be, and the generics cost more than they do in other countries, and there isn’t enough incentive to create a generic… why is that illogical. The two cases in this very thread don’t have generics.

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These two cases are loathsome, but they are not the norm (although there seems to be a trend, so maybe this will change). I think everybody in this thread agrees about these two cases (and how the patent system is not working here).

However, when the conversation moves from these two cases to the broader conversation of US pharma costs, the arguments are different. These are (so far) exceptions in a country with generic medicine cost only moderately above average and extremely high usage of generics.

298

Well the insurance companies are going to push the generics, especially since many of them have a different out-of-pocket structure for brand names vs the generics. These two cases are the reason for this long conversation and why, once again, drug companies are in the spotlight for the second time this year. It seems kind of strange to not address them consider the title of this topic.

299

But again, we just agree in these two cases, pretty much everyone does. Why keep talking about them? The data says this is not the norm (and maybe that’s why they are so noticeable).

I think it’s good they are in the spotlight because they bring attention to the different issue of pharma cost being too high in the US, but getting cheap generics for these two drugs (and other similar ones) is not going to significantly change the situation, unless I’m really misjudging the volume here.

300

According to this website, consumer.healthday.com, . about 20 percent of prescription drugs have no generic equivalent. I can’t really validate if that’s true or not, but that means at any given time any of these drugs could have the exact same situation we just saw today. In both these cases, we are told this price increase is not unusual. It happens all the time but evidently those patients don’t reach the media. My sister just got prescribed a medication that costs 35 a month. She asked if there was a generic and they said no. This could easily be her less than a year. Tomorrow someone raises the price and suddenly she’s paying 100. I think there is risk here and happens more often than the news prints.

301

Yet in the OEDC20 countries that’s more than 57% of drugs not having a generic equivalent (or the generic not being prescribed), and the costs are still way lower than in the US.

The issue is not so much the availabilty of generics, but the lack of negotiating power/price controls. Other countries with less generics but better controls don’t suffer so much price inflation.

The problem is that with your current system, generics are about the only way to lower the price. BUT generic use is so high already that keeping going in that direction is going to change little (not that much volume can be shifted). The more effective solution would be to change the system. It’s not a free market, so stop treating it like one.

Again, the US is not that special. Most other countries have found a (very similar between them) solution that works. You can’t get to 95% generic use and keep R&D in pharma running (which is something everybody here agrees should be taken into consideration), because generics are by definition not new drugs.