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They manufacture their own drugs piggy-backing off American R&D and then sell them for much much smaller margins. America's lucrative drug market funds researc

They manufacture their own drugs piggy-backing off American R&D and then sell them for much much smaller margins. America's lucrative drug market funds research which allows the rest of the world to benefit at no cost to them. Edit: seem to be getting downvoted because people think I’m saying drug companies do this out of benevolence. Not my intention. I’m saying that wrenching maximum dollars out of America but having little ability to capture returns elsewhere is a mechanism by which new drugs are created and later manufactured as foreign generics

saiya-jin 8y ago
That is only partially true - real costs of drugs say in Switzerland are properly astronomical (don't know their comparison to US but would expect same or higher). But we have pretty effective medical insurance - after paying initial yearly sum, insurance kicks in and covers 90% of the costs. No massive incomprehensible bureaucracy and fooling around with various charges. It doesn't matter what your employer is, you pay it yourself, it covers you no matter the age, status or existing state. It can still be costly to encounter something serious, some other countries cover 100% of the costs (but question is the quality and speed of treatment, because if its free, old people with tons of mostly incurable ailments can easily flood the system). If it can properly ruin you, social system steps in.
maxxxxx 8y ago
“America's lucrative drug market funds research which allows the rest of the world to benefit at no cost to them.” I think it’s more likely that it funds higher profits for the companies and all the middlemen. This is just self serving propaganda by the pharmaceutical companies.
- b_tterc_p 8y ago
  I think you’re misreading my comment. Obviously the drug companies aren’t doing this with good intentions for poorer countries, but it is a byproduct effect.
  - maxxxxx 8y ago
    Personally I think the main byproduct is higher profits, not more research.
kranner 8y ago
Indian generics are manufactured under licensing deals with the patent holders. The operation is still profitable for the patent holders because of volumes although the Indian compulsory license act allows this negotiation to happen in the first place. Indian companies can’t just manufacture patented drugs without a license. There is a judicial process to follow beginning with negotiations with the original patent holder. Only if the patent holder refuses to grant a license and the local manufacturer aspirant can prove there will be a public health crisis without the drug will the courts grant permission to bypass the patent. http://www.mondaq.com/india/x/772644/Patent/Compulsory+Licensing+In+India http://www.mondaq.com/india/x/772644/Patent/Compulsory+Licen... https://undark.org/article/hepatitis-c-sub-sofosbuvir-india/ https://undark.org/article/hepatitis-c-sub-sofosbuvir-india/
- b_tterc_p 8y ago
  Technically yes, but the fact that a backdoor exists means American patent holders need to make the deal particularly sweet to Indian generics. Sure they still profit because they’re just licensing and getting economic rent. They could be making way more if this system were not in place. It’s probably better for the world if they lean even further from patents.
otikik 8y ago
> America's lucrative drug market funds research That's a nice and heartwarming story. But I don't believe it for a second. When those companies want to fund research, they raise money from third parties. Or get it from the government in the form of grants. No, all that money goes to someone's pocket, and mostly stays there.
- refurb 8y ago
  When those companies want to fund research, they raise money from third parties. Not the big companies. R&D is funded through the sales of current products.
- secabeen 8y ago
  They do spend some of their patient revenue on R&D, but they spend more on consumer and physician marketing.
  - jonlucc 8y ago
    Should they not? Ignoring money, if you have a product which has been shown to improve lives or increase lifespan, shouldn't you aim to make it as available as possible? In general, pharmaceuticals have to prove some benefit over the current standard of care to convince payers (insurance companies) to pay for the drug. Disclaimer: I work in big pharma, though in discovery research, nowhere near pricing and business decisions. Of course, in my position, it would be great if all pharma invested more in R&D
    - secabeen 8y ago
      I'm not objecting to all marketing spending, but I do think it's out of line with the benefit. I would prefer to see prescription marketing be much more low-touch that it is today.
      - jonlucc 8y ago
        Me too. I had a manager once suggest that you could set up a consortium of pharma companies based around a disease. So, for example, every company that has a drug targeted at psoriasis would buy in, then the consortium would be tasked with raising awareness that psoriasis is a treatable condition, so go talk to your doctor. Of course it has some flaws (what about companies that are first into an indication), but it might be a step better than what we have today.
kevin_thibedeau 8y ago
The American drug market funds third and fourth homes for the C-levels.

saiya-jin 8y ago

That is only partially true - real costs of drugs say in Switzerland are properly astronomical (don't know their comparison to US but would expect same or higher). But we have pretty effective medical insurance - after paying initial yearly sum, insurance kicks in and covers 90% of the costs. No massive incomprehensible bureaucracy and fooling around with various charges. It doesn't matter what your employer is, you pay it yourself, it covers you no matter the age, status or existing state. It can still be costly to encounter something serious, some other countries cover 100% of the costs (but question is the quality and speed of treatment, because if its free, old people with tons of mostly incurable ailments can easily flood the system). If it can properly ruin you, social system steps in.

maxxxxx 8y ago

“America's lucrative drug market funds research which allows the rest of the world to benefit at no cost to them.” I think it’s more likely that it funds higher profits for the companies and all the middlemen. This is just self serving propaganda by the pharmaceutical companies.

b_tterc_p 8y ago
I think you’re misreading my comment. Obviously the drug companies aren’t doing this with good intentions for poorer countries, but it is a byproduct effect.
- maxxxxx 8y ago
  Personally I think the main byproduct is higher profits, not more research.

kranner 8y ago

Indian generics are manufactured under licensing deals with the patent holders. The operation is still profitable for the patent holders because of volumes although the Indian compulsory license act allows this negotiation to happen in the first place. Indian companies can’t just manufacture patented drugs without a license. There is a judicial process to follow beginning with negotiations with the original patent holder. Only if the patent holder refuses to grant a license and the local manufacturer aspirant can prove there will be a public health crisis without the drug will the courts grant permission to bypass the patent. http://www.mondaq.com/india/x/772644/Patent/Compulsory+Licensing+In+India http://www.mondaq.com/india/x/772644/Patent/Compulsory+Licen... https://undark.org/article/hepatitis-c-sub-sofosbuvir-india/ https://undark.org/article/hepatitis-c-sub-sofosbuvir-india/

b_tterc_p 8y ago
Technically yes, but the fact that a backdoor exists means American patent holders need to make the deal particularly sweet to Indian generics. Sure they still profit because they’re just licensing and getting economic rent. They could be making way more if this system were not in place. It’s probably better for the world if they lean even further from patents.

otikik 8y ago

> America's lucrative drug market funds research That's a nice and heartwarming story. But I don't believe it for a second. When those companies want to fund research, they raise money from third parties. Or get it from the government in the form of grants. No, all that money goes to someone's pocket, and mostly stays there.

refurb 8y ago
When those companies want to fund research, they raise money from third parties. Not the big companies. R&D is funded through the sales of current products.
secabeen 8y ago
They do spend some of their patient revenue on R&D, but they spend more on consumer and physician marketing.
- jonlucc 8y ago
  Should they not? Ignoring money, if you have a product which has been shown to improve lives or increase lifespan, shouldn't you aim to make it as available as possible? In general, pharmaceuticals have to prove some benefit over the current standard of care to convince payers (insurance companies) to pay for the drug. Disclaimer: I work in big pharma, though in discovery research, nowhere near pricing and business decisions. Of course, in my position, it would be great if all pharma invested more in R&D
  - secabeen 8y ago
    I'm not objecting to all marketing spending, but I do think it's out of line with the benefit. I would prefer to see prescription marketing be much more low-touch that it is today.
    - jonlucc 8y ago
      Me too. I had a manager once suggest that you could set up a consortium of pharma companies based around a disease. So, for example, every company that has a drug targeted at psoriasis would buy in, then the consortium would be tasked with raising awareness that psoriasis is a treatable condition, so go talk to your doctor. Of course it has some flaws (what about companies that are first into an indication), but it might be a step better than what we have today.

kevin_thibedeau 8y ago

The American drug market funds third and fourth homes for the C-levels.