Pharmaceuticals and healthcare

[Jack Sprat]

I feel certain that most of you have seen figures concerning the mark-up on pharmaceuticals. Figures like 25,000% or even 250,000% over the cost of most synthetic chemicals. Even the generics in many cases.

Do you expect a vicious fight to achieve any meaningful reform or overhaul of the current U.S. healthcare in an environment that permits this kind of consumer ripoff?

[Warpy]

1. The cost of the reagents is hardly the point

Quality control is rigorous and every batch is tested to make sure the medication has exactly the right amount of active ingredient in the right formulation.

Some medications are in micrograms, thousandths of a gram. Making sure each pill, injection or patch contains the right amount, no more and no less, is a tricky business.

Even the 300%-500% markup at the average pharmacy is somewhat understandable when you realize the sheer number of different medications they have to have in stock, on the shelf, and far enough away from their expiration dates to sell, although if uninsured people weren't subsidizing the insured, the markup would only be 100% or so, entirely reasonable.

I'm reminded of the company that had a very expensive and complicated piece of machinery break down. After trying unsuccessfully to fix it themselves, they finally called in the man who'd built it. He crawled inside, gave it two whacks with a ball peen hammer, and fixed it. When he presented his bill, it was for $5,000.50. When the management howled in protest that he'd only whacked it a couple of times with his hammer, he replied, "The half a buck was for whacking it. The five thousand was for knowing exactly where to whack it."

You're not paying for raw chemicals. Your paying for a tremendous amount of expertise in combining those raw chemicals and making sure the result will treat you and not kill you. That's why drugs cost more than their raw ingredients.

[prolesunited]

4. Nice analogy

but it fails to explain why the markup in the U.S. is so much higher. I haven't heard of massive deaths from big pharma in Mexico or Canada.

[Warpy]

5. We're subsidizing drugs there, too

because their national health systems force the pharmy companies to submit bids on those drugs. If the companies submit ridiculous bids, prices we have to pay, the countries decide to do without them until the generic comes out.

They're the same drugs, by the way. Most of what we're getting here in the US is now made offshore.

We only find out about it when those drugs are adulterated, the way heparin injection was in a plant in China.

However, anybody who thinks a markup for the original reagants over the final product as anything to do with anything is missing the point, one which I tried to explain.

[SmileyRose]

2. I can remember when the pill aisle took up about 10 feet total in the store

Only children, pregnant women and old people took vitamins. People used ice packs and warm moist towels and when it got really bad slapped on the liniment (eucalyptus/menthol and witch hazel) for pain instead of pill popping. If you had a lot of heartburn - which seemed to be rare - you altered your diet, ate less food. Soaking feet in epson salts.

Now that we have every pill under the sun we just throw more chemicals in our body and keep running on too little sleep and bad food (and yes I realize many people's choices in this are few).

[rexcat]

3. Have you considered at what cost it takes....

to get a drug to market. On average in takes about $650,000,000 to get a drug from the laboratory to market and about 15 years from start to finish. The patent rights start when the chemist finds the compound, usually within the first year to two of laboratory research. This is somewhat misleading because about 35-40% of those costs go into marketing. For every drug that makes it to market 10-15 don't make and for those drugs that don't make it to market none of the costs can be recouped.

I agree that costs for drugs is and can be outrageous. One thing that should be changed is Rx drugs should not be advertised in magazines. This was changed in 1995-96 when Newt Gingrich and his fellow republican friends changed the law and Clinton signed it. Of course this is a debatable issue. It is my belief that advertising to a largely uneducated US public does more harm than good. Another issue is the FDA. Under Bush, the FDA was slack in its regulatory duties. We need an FDA that is not in bed with the Pharma companies and is willing to do their job. Pharma companies should not be paying extra fees to expedite the approval process as they currently can do. We need to beef up the FDA so that they can approve or not approve drugs that are under an NDA (New Drug Application) in a timely manner, no matter which company is submitting the NDA. Of course the FDA should be more proactive in the IND submission (this is when a drug goes from animal testing to human testing). They are starting to be more proactive in at the beginning but improvement is still needed.

In full disclosure I work as a consultant in the pharmaceutical industry. I work on Phase I-IV clinical trials. I take all of this personally because I am involved in the approval process and I am a consumer who has to pay for more medications that I care too as I have gotten older. I have seen some nice advances over the years and can say that some of the drugs I have worked on have saved lives or extended life and quality of life. The down side is I have worked on some drugs that proved to be worthless, some harmful and some not.