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Patent expirations don't factor into this article very much, but there's this: The simple explanation for excessive drug prices is monopoly pricing. Through pa
by apo 8y ago
Patent expirations don't factor into this article very much, but there's this:
The simple explanation for excessive drug prices is monopoly pricing. Through patent protection and FDA marketing exclusivity, the U.S. government grants pharmaceutical companies a monopoly on brand-name drugs. But monopolies are a recipe for excessive prices. A company will raise prices until its profits start to drop.
That monopoly is very fleeting.
By the time a drug makes it to market, it's typically been about ten years since the patent was issued. That gives a drug company about 8 or so years of exclusivity before any other drug maker can produce the drug without infringement.
- refurb 8y agoIndeed. Companies have a limited time to recoup costs. Once the patent runs out, that $10,000 drug turns into a $500 drug. Forever. That benefit can't be ignored.
- ourmandave 8y agoWell, except for Daraprim which has been off patent for 62 years. It went from $13.50 to $750 overnight because it only has one producer that decided to raise the price 5500%. https://www.vox.com/2015/9/22/9373557/daraprim-competitor-turing https://www.vox.com/2015/9/22/9373557/daraprim-competitor-tu... And there's no generic insulin sold in the US, even though it was discovered 90+ years ago. https://www.npr.org/2015/03/22/394634923/90-years-after-its-discovery-no-generic-insulin-sold-in-the-u-s https://www.npr.org/2015/03/22/394634923/90-years-after-its-...
- refurb 8y agoExceptions don’t make the rule. For the vast,vast majority of drugs they are dirt cheap once the patent runs out.
- ourmandave 8y agoBut exceptions are the point. We live with a system that allows exceptions that manifest as the Pharmabro. My power bill doesn't randomly jump 5000% from last month.
- oldgradstudent 8y ago> My power bill doesn't randomly jump 5000% from last month. Probably because Enron is no longer in business. https://en.wikipedia.org/wiki/California_electricity_crisis?wprov=sfla1 https://en.wikipedia.org/wiki/California_electricity_crisis?...
- brixon 8y agoThere are many ways to extend the patent or the effect of the patent: https://www.upcounsel.com/how-long-does-a-drug-patent-last https://www.upcounsel.com/how-long-does-a-drug-patent-last
- refurb 8y agoThere are and some of them are an abuse of the system. However, most drugs pretty quietly go generic. A good example is Lipitor. For Pfizer it brought in over $11B per year in revenue. Cost was around $150 per month. You can now get a month’s supply for $5.94 according to GoodRx. That’s a 96% reduction in the cost.
- pbhjpbhj 8y agoIt's about 15 years with SPCs isn't it?