[iams]

This is more of a negotiation tactic against pharmaceutical companies that are marketing new wonder drugs that give terminal cancer patients 1% longer life expectancy for 10x more cost.

The drugs company can sell their new wonder drug to the UK for 80k a year, or not at all. That's why these drugs are so much cheaper in the UK than in countries such as the US.

[robertlagrant]

> That's why these drugs are so much cheaper in the UK than in countries such as the US.

Well, sort of. The drugs come to us in the UK after the US customers have paid for the R&D. That's why they're cheaper; they're not being used to fund new drug discoveries.

[s1artibartfast]

Drugs dont come to the UK after R&D has been paid. UK/EU approvals times are often close to the US, but anticipated US revenue is what justifies the initial R&D spend.

E.g. You are deciding if you will spend 1 Billion to develop a drug with a 20% sucess rate. Europe sales are projected at 2 Billion, and US sales at 10 Billion.

It is US sales that make the expected value positive. If the US paid European rates, the product would not be developed.

[robertlagrant]

> Drugs dont come to the UK after R&D has been paid

The R&D funding came from the previous drug, not the current drug.

[s1artibartfast]

>The R&D funding came from the previous drug, not the current drug.

In practice, yes that is often the case, but it doesn't matter for the new drug development decision.

If a new drug is unprofitable, it doesnt matter if there are funds from a prior one. A company will invest it elsewhere instead of spending it on a revenue negative drug.

Similarly, If a new drug looks profitable but internal funds are scarce, the Company will secure funding or sell distribution rights to raise the funds.

The Key role that the US is currently playing to making drugs profitable to develop that otherwise would not be.

I have worked on several programs, and the question is always "what is the return on investment" and never "how much do we have in the bank".

[robertlagrant]

Understood, but I wasn't saying anything different.

[s1artibartfast]

I think it is more than just a negotiation tactic. Spending controls drive prioritization within socialized health systems. You cant spend "whatever it takes" for each person.