[__s]

Surprised by the comments in this thread

US drug prices are not because of R&D. This title presents a false dichotomy

Drug companies have enough capital at this point that they don't need old drugs to fund new drugs. They can charge a high price for new drugs to recoup their development costs, & then charge closer to the cost of production once that development has been covered

[zbyte64]

Also surprised by the lack of mention of reformulating existing drugs to extend their patents. The poster child of this practice is insulin, where Americans pay absurdly higher amounts for something where generics are abundant.

[vonmoltke]

> Also surprised by the lack of mention of reformulating existing drugs to extend their patents.

Reformulation does not extend patents, it creates a new patent on the new substance. The substance in the existing patent can be manufactured as a generic after the existing patent expires.

The wrinkle is that the new and existing substances are not equivalent, and thus cannot be substituted for one another. Thus, if a doctor prescribes the new one, that is what needs to be dispensed.

[eyko]

Can't a patient ask a doctor to prescribe a generic, when it exists? It seems like that would be an easy fix: a law that requires doctors to give you the alternative name for a generic, and make the sponsored version an optional upgrade.

I'm European and the whole concept of a doctor prescribing a "brand" sounds alien to me.

[vonmoltke]

> Can't a patient ask a doctor to prescribe a generic, when it exists.

Yes, but it requires the patient (or their pharmacist) to request such.

> It seems like that would be an easy fix: a law that requires doctors to give you the alternative name for a generic, and make the sponsored version an optional upgrade.

> I'm European and the whole concept of a doctor prescribing a "brand" sounds alien to me.

The issue is that the two drugs are not equivalent, and is not about prescribing a "brand". Occasionally, a doctor insists on the brand for some reason (seems to be most common with Synthroid for some reason), but generally the prescription is treated as a prescription for the compound, even if the doctor uses a brand name.

The trouble with reformulation patents is that there is no generic for the reformulated compound. It is sufficiently different from the previous that it cannot be substituted by the pharmacist (otherwise it wouldn't have been patentable). In that case, the "brand" is the only thing available.

[bluGill]

To be fair, reformulation isn't exactly cheap (though compared to a new drug it is), and often they are better than the generic. Generic insulin still exists, but the reformulations are better - or so the diabetics I've heard from have said.

[AnthonyMouse]

> They can charge a high price for new drugs to recoup their development costs, & then charge closer to the cost of production once that development has been covered

You have just described the patent system. They get a period of patent protection to charge high prices, then anyone can make the drug and competition lowers prices.

There are some places where this falls down, i.e. there are some generic drugs that have high prices due to a lack of competition, but that's not the common case. Have a look at the price of Ibuprofen to see how unpatented generics ought to work.

What really causes the failures is the amount of bureaucratic overhead which deters other companies from entering the generics market. When the market for a drug isn't very large, the return from selling a generic is less than the regulatory cost required to enter the market, so nobody does. Lower the compliance costs and that doesn't happen as much.

[leakybit]

sounds like a not for profit