4 ms·

Can you really say the "market price is X" when there's only been one company making it? Either way, I think there are some hidden forces here that keep these

by mtgx 8y ago

Can you really say the "market price is X" when there's only been one company making it? Either way, I think there are some hidden forces here that keep these prices so high. Like if the FDA would open the market to competitors from Europe, or even countries like India, I think that "market price" you say would dramatically lower. I think the U.S. pharmaceuticals market both lacks competition from generics, as well as has some weird laws like "Medicare can't negotiate prices with pharma companies," which only encourages pharma companies to raise their prices as much as possible. The law I mention is almost solely responsible for all the "drug X increased price by 5,000%" headlines you've seen lately. Pharma companies have figured out they can shamelessly rob taxpayers and nobody will do a thing about it, as long as they donate to the right politicians (from both parties).

thaumasiotes 8y ago
Medicare has a different negotiation system built in -- Medicare reimburses a fixed percentage of the minimum amount you charge, to anyone under any circumstances, for the same procedure. This means that doctors who accept Medicare have a price floor set for everyone else by the minimum they need to get from Medicare patients. (Yes, procedures from doctors aren't the same thing as drugs from manufacturers.)
refurb 8y ago
"Medicare can't negotiate prices with pharma companies" That's a common statement, but not really true. Medicare Part D, which covered prescription drugs, is managed by private insurers who can negotiate for the price of drugs. In Medicare Part B, which covered physician administered drugs, Medicare pays the average sales price. Which means every time a private insurer gets a lower price, some of that is passed onto Medicare. So the statement "Medicare can't negotiate drug prices" is technically true, but ignores all the other ways it can get lower drug prices.
niftich 8y ago
It's worth noting that the Teva device that's the subject of the article is what the FDA considers an 'Authorized Generic'. From the press release [1]: >"An authorized generic is made under the brand name’s existing new drug application using the same formulation, process and manufacturing facilities that are used by the brand name manufacturer. The labeling or packaging is, however, changed to remove the brand name or other trade dress. In some cases, a company may choose to sell an authorized generic at a lower cost than the brand-name drug product." While this is different from what common language calls a 'generic drug' [2], in some cases either kind of "generic" could, may, or must be substituted by pharmacists, depending on various circumstances and the particular state's regulatory regime [3]. This interacts with the epinephrine autoinjector market in two ways. First, there is little upside for the manufacturer of the authorized generic to make the list price significantly lower, as the list price is rarely paid by the end-user out of pocket, and frequent mandatory substitution laws cause makers of Authorized Generics to gain marketshare as long as they're slightly cheaper than the brand Second, Authorized Generics of combination devices are only subsitutable for a corresponding brand, so different devices like Auvi-Q and Adrenaclick are technically a different market entirely: the doctor's prescription will note the exact sort of device. Therefore, while there are other epinephrine autoinjectors, the marketshare among them is decided in doctor's offices and insurance plans, rather than by direct consumer choice through the end-user's own spending. [1] https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm617173.htm https://www.fda.gov/newsevents/newsroom/pressannouncements/u... [2] https://www.fda.gov/drugs/developmentapprovalprocess/howdrugsaredevelopedandapproved/approvalapplications/abbreviatednewdrugapplicationandagenerics/ucm126389.htm https://www.fda.gov/drugs/developmentapprovalprocess/howdrug... [3] (2008) (for illustration only) https://www.uspharmacist.com/article/generic-substitution-laws https://www.uspharmacist.com/article/generic-substitution-la...
- paulie_a 8y ago
  You can tell your doctor to prescribe a cheaper alternative. If the doctor has no reason to not do so, time to get a new doctor.
- makomk 8y ago
  The Authorized Generic is a different product that's in direct competition with the Teva device, as I understand it.

by mtgx 8y ago

thaumasiotes 8y ago

Medicare has a different negotiation system built in -- Medicare reimburses a fixed percentage of the minimum amount you charge, to anyone under any circumstances, for the same procedure. This means that doctors who accept Medicare have a price floor set for everyone else by the minimum they need to get from Medicare patients. (Yes, procedures from doctors aren't the same thing as drugs from manufacturers.)

refurb 8y ago

"Medicare can't negotiate prices with pharma companies" That's a common statement, but not really true. Medicare Part D, which covered prescription drugs, is managed by private insurers who can negotiate for the price of drugs. In Medicare Part B, which covered physician administered drugs, Medicare pays the average sales price. Which means every time a private insurer gets a lower price, some of that is passed onto Medicare. So the statement "Medicare can't negotiate drug prices" is technically true, but ignores all the other ways it can get lower drug prices.

niftich 8y ago

It's worth noting that the Teva device that's the subject of the article is what the FDA considers an 'Authorized Generic'. From the press release [1]: >"An authorized generic is made under the brand name’s existing new drug application using the same formulation, process and manufacturing facilities that are used by the brand name manufacturer. The labeling or packaging is, however, changed to remove the brand name or other trade dress. In some cases, a company may choose to sell an authorized generic at a lower cost than the brand-name drug product." While this is different from what common language calls a 'generic drug' [2], in some cases either kind of "generic" could, may, or must be substituted by pharmacists, depending on various circumstances and the particular state's regulatory regime [3]. This interacts with the epinephrine autoinjector market in two ways. First, there is little upside for the manufacturer of the authorized generic to make the list price significantly lower, as the list price is rarely paid by the end-user out of pocket, and frequent mandatory substitution laws cause makers of Authorized Generics to gain marketshare as long as they're slightly cheaper than the brand Second, Authorized Generics of combination devices are only subsitutable for a corresponding brand, so different devices like Auvi-Q and Adrenaclick are technically a different market entirely: the doctor's prescription will note the exact sort of device. Therefore, while there are other epinephrine autoinjectors, the marketshare among them is decided in doctor's offices and insurance plans, rather than by direct consumer choice through the end-user's own spending. [1] https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm617173.htm https://www.fda.gov/newsevents/newsroom/pressannouncements/u... [2] https://www.fda.gov/drugs/developmentapprovalprocess/howdrugsaredevelopedandapproved/approvalapplications/abbreviatednewdrugapplicationandagenerics/ucm126389.htm https://www.fda.gov/drugs/developmentapprovalprocess/howdrug... [3] (2008) (for illustration only) https://www.uspharmacist.com/article/generic-substitution-laws https://www.uspharmacist.com/article/generic-substitution-la...

paulie_a 8y ago
You can tell your doctor to prescribe a cheaper alternative. If the doctor has no reason to not do so, time to get a new doctor.
makomk 8y ago
The Authorized Generic is a different product that's in direct competition with the Teva device, as I understand it.