4 ms·

From https://en.m.wikipedia.org/wiki/Prescription_costs https://en.m.wikipedia.org/wiki/Prescription_costs “A study has placed the amount spent on drug marketi

From https://en.m.wikipedia.org/wiki/Prescription_costs https://en.m.wikipedia.org/wiki/Prescription_costs “A study has placed the amount spent on drug marketing at 2-19 times that on drug research” Maybe this should be reduced first?

rayiner 8y ago
The wikipedia article misstates the figure in the underlying paper. The underlying paper is talking about "basic research" not R&D. I.e. it doesn't count money spent on e.g. making improvements to use of known molecules, it doesn't count the cost of bringing a new molecule to market, it doesn't count the cost of testing, etc. That's a non-sequitur. Companies have no incentive to spend any more on marketing than they have to. Tech companies also spend more on marketing than R&D--would innovation increase if the government forced that number downward?
- toomuchtodo 8y ago
  Only in America and New Zealand are pharmaceuticals permitted to be marketed directly to consumers. Does the rest of the world not innovate? We’ve tried the free market way, let’s try it the “rest of the developed world way” next.
  - chimeracoder 8y ago
    > Only in America and New Zealand are pharmaceuticals permitted to be marketed directly to consumers. Marketing does not only include direct-to-consumer advertising. > Does the rest of the world not innovate? Pharmaceuticals are a global market. As it turns out, European pharmaceutical companies make a disproportionate share of their revenues from pharmaceutical sales in the US. But to answer your question: statistically, no, the rest of the world doesn't innovate. Half of all pharmaceutical R&D costs in the entire world are funded by the US. That share has dropped slightly in recent years, but not because the "rest of the developed world" has been increasing their funding: it's because India and China have been rapidly expanding their R&D.
    - cwkoss 8y ago
      > Marketing does not only include direct-to-consumer advertising. The other flavor bribes doctors to overprescribe - it is much worse.
nostromo 8y ago
This is flawed thinking. But it's very popular flawed thinking, so you're certainly not alone. :) If marketing has a return on investment (and it does) then marketing spend also increases money available for R&D. Marketing and R&D are not pieces of a fixed pie. Marketing spend grows the entire pie and provides additional dollars for the company to spend on R&D.
- mywittyname 8y ago
  It does provide a perverse incentive to research drugs with high market potential over those with live saving potential.
  - refurb 8y ago
    Of course it does. But until you can find trees that grow money, you need to invest in R&D that pays for itself.
- hwillis 8y ago
  > Marketing and R&D are not pieces of a fixed pie. Marketing spend grows the entire pie and provides additional dollars for the company to spend on R&D. You're talking like marketing extracts money from the ground as if it's a raw resource. If 10x as much is spent on marketing as RD then the money spent on pharmaceuticals is <10% going to RD. That's not good for the consumer. It would be good if marketing was regulated and that pharmaceuticals were forced to compete by spending money on RD and making better drugs.
  - nostromo 8y ago
    It doesn't matter how much gets spent on marketing in relative terms. If it were 99% of the budget, but R&D was larger in absolute dollars, then that'd be a net positive. Marketing increases revenue. A portion of revenue goes to R&D. Ergo, more marketing means more revenue available for R&D.
- cwkoss 8y ago
  There is no moral way for a pharma company to increase demand for its product.

rayiner 8y ago

The wikipedia article misstates the figure in the underlying paper. The underlying paper is talking about "basic research" not R&D. I.e. it doesn't count money spent on e.g. making improvements to use of known molecules, it doesn't count the cost of bringing a new molecule to market, it doesn't count the cost of testing, etc. That's a non-sequitur. Companies have no incentive to spend any more on marketing than they have to. Tech companies also spend more on marketing than R&D--would innovation increase if the government forced that number downward?

toomuchtodo 8y ago
Only in America and New Zealand are pharmaceuticals permitted to be marketed directly to consumers. Does the rest of the world not innovate? We’ve tried the free market way, let’s try it the “rest of the developed world way” next.
- chimeracoder 8y ago
  > Only in America and New Zealand are pharmaceuticals permitted to be marketed directly to consumers. Marketing does not only include direct-to-consumer advertising. > Does the rest of the world not innovate? Pharmaceuticals are a global market. As it turns out, European pharmaceutical companies make a disproportionate share of their revenues from pharmaceutical sales in the US. But to answer your question: statistically, no, the rest of the world doesn't innovate. Half of all pharmaceutical R&D costs in the entire world are funded by the US. That share has dropped slightly in recent years, but not because the "rest of the developed world" has been increasing their funding: it's because India and China have been rapidly expanding their R&D.
  - cwkoss 8y ago
    > Marketing does not only include direct-to-consumer advertising. The other flavor bribes doctors to overprescribe - it is much worse.

nostromo 8y ago

This is flawed thinking. But it's very popular flawed thinking, so you're certainly not alone. :) If marketing has a return on investment (and it does) then marketing spend also increases money available for R&D. Marketing and R&D are not pieces of a fixed pie. Marketing spend grows the entire pie and provides additional dollars for the company to spend on R&D.

mywittyname 8y ago
It does provide a perverse incentive to research drugs with high market potential over those with live saving potential.
- refurb 8y ago
  Of course it does. But until you can find trees that grow money, you need to invest in R&D that pays for itself.
hwillis 8y ago
> Marketing and R&D are not pieces of a fixed pie. Marketing spend grows the entire pie and provides additional dollars for the company to spend on R&D. You're talking like marketing extracts money from the ground as if it's a raw resource. If 10x as much is spent on marketing as RD then the money spent on pharmaceuticals is <10% going to RD. That's not good for the consumer. It would be good if marketing was regulated and that pharmaceuticals were forced to compete by spending money on RD and making better drugs.
- nostromo 8y ago
  It doesn't matter how much gets spent on marketing in relative terms. If it were 99% of the budget, but R&D was larger in absolute dollars, then that'd be a net positive. Marketing increases revenue. A portion of revenue goes to R&D. Ergo, more marketing means more revenue available for R&D.
cwkoss 8y ago
There is no moral way for a pharma company to increase demand for its product.