It's true for new drugs, but insuline price have been multiplied by 5 during the last decade (https://www.ontrackdiabetes.com/type-1-diabetes/insulin-pric...), which is a drug that should actually cost less to make, since we know it very well, and have a lot of demand now with the obesity epidemic.
Similar thing happened to dexamphetamine, an ADHD medication. It's not quite as bad (also because people need insulin to live, but dexamphetamine to function), but it just shows how tremendously STUPID this whole business is. Note that dexamphetamine is an old, very well-known medicine, just like insulin, none of the bullshit about pharma-startups business plans and research costs apply.
So, basically someone bought the rights to the 5mg tabs, and now those are uninsured and would rack up 100s of euros per month. So instead you get the same prescription but in 2.5mg tabs, which is available as a generic brand and therefore just about free under Dutch healthcare. This may seem like a small difference, but we're talking about people with attention-deficit disorder, having to count and not get distracted twice as many pills, right at the moment the previous dose wears off. Taking them at a very precise regular schedule at the right dose really can make a huge difference in effectiveness. You don't want to get it wrong.
Sure it's not insulin, and it's mostly an inconvenience, but it's just so STUPID. I mean who the hell obtains the rights to 5mg dexamphetamine tablets? How? Why? And could the same happen to paracetamol?
What troubles me about insulin prices is that raising prices can simultaneously be used to satisfy shareholders with growing profits AND be used to fund new drugs (revenue from existing drugs obviously must fund the creation of new drugs). I am a little worried that if strict financial controls are put in place, then the companies will just turn into cash cows for existing drugs because a limit has been put on the profitability of new ones.
I believe we need to trudge further and further because even though we are creating new therapies that are wildly expensive, we are moving closer to truly cost effective therapies and best-in-class therapies. Though, we are certainly not there yet.
If someone can explain to me that my fears are unjustified about price controls diminishing capital invested into new treatments, I'd happily join the chorus of people calling for price controls in medicine (US citizen here with a chronic disease treated by TNF inhibitor which can cost 30K+ a year but through employer insurance, I pay nothing except for a copay which the manufacturer pays for).
> What troubles me about insulin prices is that raising prices can simultaneously be used to satisfy shareholders with growing profits AND be used to fund new drugs (revenue from existing drugs obviously must fund the creation of new drugs).
That's not obvious at all; there's no reason creation of new drugs couldn't be financed by raising capital through either debt or equity issues, which are then paid back, in effect, by the profits from the drug itself; in fact, a fair amount of drug development is funded that way, because it's done by startups which are acquired by major firms, if at all, only after doing much of the development work; obviously, that's how every firm’s first drug is financed.
It may be that firms want to eventually shift business models, so at some point they take their existing stake of drugs and body prices so instead of paying off their own development, they are doing that and paying forward development, and after that switch to internal financing, but there is no reason that is obviously a necessity.
Fair reply, and thank you for replying. While I agree the funding mechanisms you mentioned certainly must exist, I imagine things like unexpected delays for a given therapy or complications with a clinical trial (not with the medicine but with some procedural stuff) must happen. Times where existing room in revenue streams is vital for the development.
Secondly, if a publicly traded company already has a significant amount of equity in the hands of the public, issuing too much debt can mess with the balance sheet, right?
I hear you though, I still worry that price controls is attacking the issue in the wrong way. I don't know all the specifics, but I feel like protections to competition would be a better way to ensure the competitive market?
This is an area I'd really like to understand more from a non-partisan perspective, especially understanding the current nature of which countries actually do develop the most drugs. But every piece of information I find on this subject has a partisan bent. Anyone got a source they'd recommend?
So, basically someone bought the rights to the 5mg tabs, and now those are uninsured and would rack up 100s of euros per month. So instead you get the same prescription but in 2.5mg tabs, which is available as a generic brand and therefore just about free under Dutch healthcare. This may seem like a small difference, but we're talking about people with attention-deficit disorder, having to count and not get distracted twice as many pills, right at the moment the previous dose wears off. Taking them at a very precise regular schedule at the right dose really can make a huge difference in effectiveness. You don't want to get it wrong.
Sure it's not insulin, and it's mostly an inconvenience, but it's just so STUPID. I mean who the hell obtains the rights to 5mg dexamphetamine tablets? How? Why? And could the same happen to paracetamol?