9 ms·

That's the loophole though, the quantities are so small that realistically, no pharmaceutical company has the incentive to make their version of the drug, even

• danmaz74 11y ago
  They should just allow importing drugs from other markets that have good enough quality standards - like the EU or Canada I guess. Problem solved.
  • imdsm 11y ago
    Can this drug be reproduced by others? Is it simply a licensing issue?
    • TD-Linux 11y ago
      All of the drugs mentioned in the article have had their patents expire long ago.
  • ssmoot 11y ago
    But who provides the quality standards oversight? The drug is apparently produced in India. What if pills were shipped to the US and it was found after the fact that many batches contained unacceptable levels of iron? Who to blame? I'm sure Canada has decent oversight, but who wants to say that the solution is no direct US agency oversight, and that we want a "Pharmaceuticals-NAFTA"? It seems funding oversight with a "homeland" agency is one issue you could get bipartisan support on. While sure, I doubt many have a problem with medical tourism, I'm not sure bringing drugs across the border intended for distribution without FDA approval is the answer. On the other hand maybe countries working together at the agency level to ensure their oversight measures are in compliance with some agreed upon standard is a sane way to move forward. But then who maintains the list of approved drugs? Is that power given to some international body? Or does the FDA still have to approve drugs for distribution and only alternatives are brought in? And then what about drugs that are patented in the US (like this one), but freely available in other markets from other manufacturers? It seems a worthy enough goal in general, but I don't think a fully libertarian approach to the problem comes close to being the right answer either.
    • danmaz74 11y ago
      > Pharmaceuticals-NAFTA I'm not a libertarian and I'm in favor regulations when needed, but in this case I think that recognizing drug testing and quality controls between countries that have similar standards would be a great help at curbing costs. "FDA approval" in this case should mean that the FDA could recognize that if agency X from Country Y says that a generic pharmaceutical is safe, you don't need to do the same tests again. Of course this should work both ways - I'm from the EU, and I'd like to be able to get drugs manufactured in the US when they're cheaper and just as safe.
    • leshow 11y ago
      Did you miss the main caveat? Countries with good quality testing standards. If you have many countries with very similar quality assurance standards then surely it makes sense to rely on the work of others, or have a revised (shorter, cheaper) process for drugs to go through which have already been approved by certain countries. I don't think anybody is suggesting mass importation of low quality Indian or Thai versions of drugs.
    • robotresearcher 11y ago
      We import all kinds of stuff from all over the world and enforce quality standards very well. The current situation is more like protectionism than consumer protection in many cases.
      • Kalium 11y ago
        While broadly true, this is an area where counterfeiting is easier, detection is difficult, enforcement is harder, and legitimate manufacturing is often expensive. In other words, exactly the conditions to encourage all kinds of abuses.
        • robotresearcher 11y ago
          That is all true but we don't have to buy from shady producers. Canadian and European producers supply their own very safe and mature markets. Buy the stuff that the UK NHS buys and at the same prices - their scale gets them good deals (with notable exceptions). This can't be worse than the current deal.
  • deleted 11y ago
    [deleted]
  • FireBeyond 11y ago
    I'm sure he'd be happy to let that go unprotested ... "Skrelicame to attention after his attempts to have the FDA not approve drugs being produced by companies whose stocks he was shorting". Who needs morality in the free market, right?
    • cowsandmilk 11y ago
      That is a very biased view of the situation. Pharma companies try to put the best face on data to get a drug approved. Analysts try to approach the data in an impartial way. If an analyst looks at the data and sees issues, it makes sense both ethically and financially to push for the drug not to be approved. Ethically, if the drug doesn't work as advertised, it is better that it is not sold as a cure. Informing the FDA of your analysis is a duty. Financially, if you think the drug doesn't work, it makes sense to short the stock in the belief that it won't be approved. Pharma companies always present it as hedge funds trying to kill their products, but if the data is strong and the drug works, the analyst could just go long on the company instead.
      • kragen 11y ago
        Yes, it makes sense ethically to push the FDA not to approve a drug you think won't work. It also makes sense financially to bet that the FDA won't approve a drug that you think won't work. But it doesn't make sense ethically to do both, both directly because it creates a conflict of interest, and indirectly because that very conflict of interest undermines both the objectivity and the credibility of your recommendation not to approve the drug.
        • ci5er 11y ago
          You are arguing ... what, here? That people with some sort of knowledge of a product/company/industry's prospects shouldn't be allowed to buy/sell positions in that company? If I understand you (and I may not), and we were to come to the conclusion that "there ought to be a law", I have no idea how that would even be structured/written.
• caseysoftware 11y ago
  Even though it's $750 per dose now, since they have exclusive control over the market they could decrease it to whatever whenever they wanted to starve competitors.. probably after said competitors have invested in doing it.
  • nickff 11y ago
    This is a possible strategy, but is rarely used, as it is very risky (, it is likely to cost a great deal of market share in the long term). I have looked into it, and found very few examples of a company which tried to lure a competitor into a market, then under-sell them. The opposite (under-sell competition to gain market share then hike prices) also appears to be quite unpopular in the real market, for the opposite reason (it will surely gain market share in the short term, but can cost a great deal of money). These are very popular theories, and there are a few examples of those who have tried both strategies, but those examples are almost all cautionary tales.
    • unprepare 11y ago
      I think its somewhat common, and even occasionally successful: Amazon prime costs amazon money, and the original fire tablets were sold at cost - i suspect the new 50$ tablets are not very profitable either Walmart has commonly been accused of this practice for various products Google's original Nexus 7 tablet I believe Apple ended up losing money at least a quarter or two on the app store/itunes Granted there are few examples, but its certainly prevalent enough that its a legitimate business concern - the bigger disparity is that it takes a pretty enormous size for a company to succeed in such a tactic, I doubt turing has the kind of capital to lose that the likes of Walmart, Apple, Google and Amazon do.
      • nickff 11y ago
        Those are good examples, but I would argue that if a practice is sustainable (and often sustained), it is not problematic. If Amazon wishes to provide Prime at a loss to encourage customers to buy products which Amazon will make money on (enough to compensate for Prime), is there a problem? Would there be a problem if Amazon offered to ship things sooner in exchange for a promise that you would shop at their site more often (even if this promise plan cost them money)?
• fspeech 11y ago
  Maybe the big drug retailers (CVS/Walgreen/Walmart) could be interested in either owning or partnering with generic makers, as they can derive secondary benefits such as reputation/traffic even if a particular drug is temporarily unprofitable. They could also attempt "premium" generics like what Costco did with the Kirkland brand. You need a player that can benefit in other ways to prevent someone from gaining a monopoly through price manipulation.
  • darkmighty 11y ago
    Not familiar with the industry, but I don't think the problem can be solved this way (at least in the short term). Simply by the distribution of drugs/prices, there seems to be a very large number of low cost drugs susceptible to this tactic. There's ample space for them to pick a drug now and then and put abusive prices all of a sudden, while lowering the price as soon as competition threatens to move in. Additionally, the costs of reverse engineering a drug are high enough to make this kind of competition very hard. I see no other way than some regulation to at least force some hysteresis or stability on the prices.
• refurb 11y ago
  The case of KV Pharmaceuticals that I cited was a little different since compounding labs had already been making the drug Makena. In that case, the FDA actually sent these labs a letter essentially saying, "Go ahead and keep making the drug even though KV now has a patent for it. We are choosing to not enforce their patent because their price increase was bs." KV never had a patent for Makena. What they did have was "data exclusivity" which meant the FDA could not approve another version of the drug for at least 5 years. What they were counting on was the FDA clamping down on the compounding pharmacies, since they weren't selling an approved version of the drug. The FDA, seeing KV's strategy, declined to shutdown the compounders which resulted in KV declaring bankruptcy. KV restructured, reduced the cost of the drug and created a sustainable business. They were acquired by Valeant I believe.
• technotony 11y ago
  I don't get this, the drug is available from Sigma[1] for $51.50 per 250mg, with a dosage of 50-75mg per day for a patient. So clearly someone can make it more cheaply. I get that Sigma is research chemicals not medical grade, but seems to me someone could figure this out. FDA approval must be the issue. [1] http://www.sigmaaldrich.com/catalog/product/fluka/46706?lang=en&region=US http://www.sigmaaldrich.com/catalog/product/fluka/46706?lang...
  • Laforet 11y ago
    One word: Bioequivalence. Having the correct active ingredient does not imply that drug delivery and efficacy are equivalent unless you can prove it by comparing it against a known and approved formulation in human volunteers, The burden of proof is significantly less than that of getting a new compound approved, but still a major sinkhole for money. The correct way to handle this would be for the FDA to hand out compassionate use permits for patients to import their own drugs since it is clearly unavailable for a reasonable price in the US.