5 ms·

Something I saw in drug pricing conferences is that there is a push to price drugs according to how much personal and social benefit they provide and how much a

by ta988 4y ago

Something I saw in drug pricing conferences is that there is a push to price drugs according to how much personal and social benefit they provide and how much a person would be willing to pay to extend their life or resolve a condition. An extreme example for that model, if a drug allow a kid to survive and have a productive life it can be priced millions whereas a palliative drug could be much cheaper. This has nothing to do with research and cost of development anymore (if it even ever did).

klyrs 4y ago
I met a researcher once who was doing what appeared to be groundbreaking research on cancer care. He had this beautiful, tear-jerker story about losing his wife that cast a rosy, altruistic hue on his research. When he was asked what the device would cost, he cheerily replied "whatever the market will bear." That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants.
- brigandish 4y ago
  > That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. What should it cost instead? > Dude was living off of government research grants. Let's imagine his work comes to fruition. The drug is expensive but efficacious - is this not a good thing? Should the government have not helped fund this drug because now it's expensive? The alternative is a world without that drug and without as much incentive to produce the drug. I'm not sure that's a good trade.
  - chris_wot 4y ago
    I’m sorry, but that’s a non sequitur. The alternative is not that the drug wasn’t produced. It is that the drug wasn’t developed by private enterprise.
    - brigandish 4y ago
      Please don't give insincere apologies, they're rhetorically weak and pairing insincerity with something that should be sincere isn't a good look. Which segues nicely to this pairing of public funding and private enterprise. No, if the drug wouldn't be sold for a profit then the incentive to make it wouldn't exist and the funds would not be applied for and the ironic pairing - if it is ironic, which I don't think it is - wouldn't exist either. Unless we're going to believe that researchers go through the mill of applying for funding and doing research simply to get the funding and stay in badly paid employment?
      - chris_wot 4y ago
        Your response assumes that all medical research is done solely to make a profit.
        brigandish 4y ago
        It's not an assumption, it was in the example I responded to: > When he was asked what the device would cost, he cheerily replied "whatever the market will bear." I also do not need to assume that companies undertaking research are doing it for profit as that is their reason for being companies, and even in the case of research being not directly undertaken for profit, that research - if useful - will go into drugs that are then sold with the intention of making a profit. Not solely, whether cynically or altruistically, the hope will be that the drug is effective.
      - pmyteh 4y ago
        I don't know about medical research, but that's exactly what the rest of us in universities do.
        astrange 4y ago
        You get social rewards like titles, getting into vicious personal arguments over personal things, and being able to reject younger researchers’ work in peer review if it would disprove yours. Can’t displace Chomsky as a famous linguist if he writes a letter to everyone’s dissertation committee if they criticize him.
  - goodpoint 4y ago
    > What should it cost instead? To patients? It should be free. To society? The initial research cost plus the bare manufacturing cost.
    - brigandish 4y ago
      > To patients? It should be free. Someone has to pay. Who pays? > To society? The initial research cost plus the bare manufacturing cost. And we're back to a society which is poorer in terms of both health and wealth.
      - turtledove 4y ago
        Ah yes, a society with low cost medicines and a healthy research investment - definitely a recipe for low wealth and health. /s
        brigandish 4y ago
        I also dream of utopia but when I wake up I have to supply the logic that fills in the gaps else it remains a dream. If you remove the profit motive then investment falls, new medicines become less likely and lesser in number, and medicines remain higher in cost due to lack of pressure (competition from new drugs, competition from new entrants, new techniques etc). Altruism, necessary as it is, does not fill that void alone, and it certainly won't be filled by hoping government makes everything "free".
        goodpoint 4y ago
        > If you remove the profit motive then investment falls The last 200 years proven otherwise. All basic research around airplanes, semiconductors, satellites, GPS, GSM, fiber optics, CD/DVD and much much more was almost entirely tax funded.
  - klyrs 4y ago
    > Should the government have not helped fund this drug because now it's expensive? No, the government should set a reasonable price for the product they funded. A high enough price to fund manufacturing, a low enough price to ensure that people who need the treatment have ready access to it. If the upper bound on price is too low for universal access, that's what subsidies are for. Instead, we have free money to bootstrap extractive capitalists, at cost and detriment to people who need care.
    - brigandish 4y ago
      > No, the government should set a reasonable price for the product they funded. Do the investors at the company you work at set the prices for the products you produce? That would be strange. > Instead, we have free money to bootstrap extractive capitalists, at cost and detriment to people who need care. It's "free" money because the capital costs are high and it's risky. I don't think it's the only or the best way but it is a valid way, but it doesn't remove the right to make a profit. As to it being "detriment[al]" to the people who need care, they're getting a drug that didn't exist before, right? And this also should (generally) make existing drugs cheaper, right?
  - jlarocco 4y ago
    > Should the government have not helped fund this drug because now it's expensive? If he wants to charge "what the market will bear," then he should fund the research through the market. If he wants government handouts to do the research then the public deserves to get the benefit that it's paying for - we're not funding it to make some guy rich. I'm not saying it should be free, but he's already opted out of the market, so he loses out on market pricing. Manufacturing cost plus some reasonable percentage for the creator.
    - brigandish 4y ago
      I'm all for cutting subsidies, but the problem is that if you want risky things then investors might decide it's better not to invest and the drugs never appear. The government (which is really a government of and for the people, right?;) gets what it wants - a new drug - and jobs are created, trade happens, taxes are levied, health improves leading to (theoretical) money saved, more hours worked, more taxes… There's no need to punish the creator by not letting them make money off of their creation just because the government was involved, the government is getting plenty out of their investment.
      - jlarocco 4y ago
        > I'm all for cutting subsidies, but the problem is that if you want risky things then investors might decide it's better not to invest and the drugs never appear. So? Nobody has a right to free money. If investors don't want to fund the research, and the researcher doesn't want to share the results with the public, then no money for them. They can go off and work on something else. > There's no need to punish the creator by not letting them make money off of their creation just because the government was involved, the government is getting plenty out of their investment. You're putting words in my mouth. I said the cost of government funded drugs should be the cost of manufacturing plus a percentage for the inventor. Second, that's not how government funding works. If the public funds a thing, then the public has a right to use that thing. If the inventor doesn't like it, then they shouldn't take funding from the government. Funny to see a pro-corporate welfare argument on HN.
- nootropicat 4y ago
  That's not the problem, that's the reason almost all medical development happens in America. Rich people from all around the world travel to American hospitals if they have serious health problems, not to public hospitals even in rich countries like Norway. Public healthcare works (poorly) as a way to distribute existing treatment, but is worthless at incentivizing development. Really, the entire world is unfairly parasitizing on Americans to fund medical research.
  - machiaweliczny 4y ago
    Or rather America is siphoning market by having monopoly. My father works in pharma factory and wages have not risen almost at all since 20 years ago when it was bought by americans (by bribe to gov). Some drugs got 10x more expensive while workers and patients got it worse. This was ultra scam but even after change of owners it’s basically the same. Capitalism works only with competition. But competition is against capital owners short-term extractionism (or rather against ceos who feels need to justify their pay). IMO solution is to let workers vote on CEO pay changes and punish white collar crime better and many problems of capitalism might get solved. EDIT: IMO it won’t work as long as globalization can be exploited to suppress working class and avoid regulation
  - bwb 4y ago
    That is not true, look up medical outcome data. Most of europe is far ahead or even with the USA.
    - caddemon 4y ago
      Unless you are looking at outcomes of only the top institutions it's not really what he was saying. The US has a bad system for the average person for sure, but that does not mean that the US doesn't have one of the best systems if you can afford the best care. If you have medical outcome data that disputes that specifically I'd be interested.
      - bwb 4y ago
        Why would you think the best hospitals in the USA outperform any other developed country's best hospitals? Especially when those countries already deliver better average results across the board. Why do you have this belief and what is it based on? One example of cancer outcomes on a per country basis: https://worldpopulationreview.com/country-rankings/cancer-survival-rates-by-country https://worldpopulationreview.com/country-rankings/cancer-su... Just google medical outcomes for any disease on a per country basis. Do you really think the best hospitals in France or somehow worse than the best hospitals in the USA? Especially when the best hospitals in the USA still have the same fundamental problems as the rest of the American system?
- pkaye 4y ago
  > That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants. Do the drug companies in Europe do any different though?
  - xmodem 4y ago
    I mean, sort of? Except, not really, because, "what the market will bear" is determined by what governments can negotiate - there's no Medicare Part D tying their hands.
    - pkaye 4y ago
      But the companies are still greedy in Europe. Zolensma one of the most expensive drugs is from Europe. Those companies sell it for what its worth. When Joe Biden proposed covid vaccine patent waivers, European leaders were quick to suck with with the corporations in opposition.
abeppu 4y ago
But so two patients in different financial circumstances would both pay basically as much as they are able for a life-saving treatment, arriving at very different amounts, right? - that sounds a lot like ransom? - I think if they adopt a policy of price-discrimination to the point of literally taking you for all (or most) of what you're worth (or projected to be worth), we should turn around and apply the same reasoning to corporate tax rates.

by ta988 4y ago

klyrs 4y ago

I met a researcher once who was doing what appeared to be groundbreaking research on cancer care. He had this beautiful, tear-jerker story about losing his wife that cast a rosy, altruistic hue on his research. When he was asked what the device would cost, he cheerily replied "whatever the market will bear." That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants.

brigandish 4y ago
> That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. What should it cost instead? > Dude was living off of government research grants. Let's imagine his work comes to fruition. The drug is expensive but efficacious - is this not a good thing? Should the government have not helped fund this drug because now it's expensive? The alternative is a world without that drug and without as much incentive to produce the drug. I'm not sure that's a good trade.
- chris_wot 4y ago
  I’m sorry, but that’s a non sequitur. The alternative is not that the drug wasn’t produced. It is that the drug wasn’t developed by private enterprise.
  - brigandish 4y ago
    Please don't give insincere apologies, they're rhetorically weak and pairing insincerity with something that should be sincere isn't a good look. Which segues nicely to this pairing of public funding and private enterprise. No, if the drug wouldn't be sold for a profit then the incentive to make it wouldn't exist and the funds would not be applied for and the ironic pairing - if it is ironic, which I don't think it is - wouldn't exist either. Unless we're going to believe that researchers go through the mill of applying for funding and doing research simply to get the funding and stay in badly paid employment?
    - chris_wot 4y ago
      Your response assumes that all medical research is done solely to make a profit.
      - brigandish 4y ago
        It's not an assumption, it was in the example I responded to: > When he was asked what the device would cost, he cheerily replied "whatever the market will bear." I also do not need to assume that companies undertaking research are doing it for profit as that is their reason for being companies, and even in the case of research being not directly undertaken for profit, that research - if useful - will go into drugs that are then sold with the intention of making a profit. Not solely, whether cynically or altruistically, the hope will be that the drug is effective.
    - pmyteh 4y ago
      I don't know about medical research, but that's exactly what the rest of us in universities do.
      - astrange 4y ago
        You get social rewards like titles, getting into vicious personal arguments over personal things, and being able to reject younger researchers’ work in peer review if it would disprove yours. Can’t displace Chomsky as a famous linguist if he writes a letter to everyone’s dissertation committee if they criticize him.
- goodpoint 4y ago
  > What should it cost instead? To patients? It should be free. To society? The initial research cost plus the bare manufacturing cost.
  - brigandish 4y ago
    > To patients? It should be free. Someone has to pay. Who pays? > To society? The initial research cost plus the bare manufacturing cost. And we're back to a society which is poorer in terms of both health and wealth.
    - turtledove 4y ago
      Ah yes, a society with low cost medicines and a healthy research investment - definitely a recipe for low wealth and health. /s
      - brigandish 4y ago
        I also dream of utopia but when I wake up I have to supply the logic that fills in the gaps else it remains a dream. If you remove the profit motive then investment falls, new medicines become less likely and lesser in number, and medicines remain higher in cost due to lack of pressure (competition from new drugs, competition from new entrants, new techniques etc). Altruism, necessary as it is, does not fill that void alone, and it certainly won't be filled by hoping government makes everything "free".
        goodpoint 4y ago
        > If you remove the profit motive then investment falls The last 200 years proven otherwise. All basic research around airplanes, semiconductors, satellites, GPS, GSM, fiber optics, CD/DVD and much much more was almost entirely tax funded.
- klyrs 4y ago
  > Should the government have not helped fund this drug because now it's expensive? No, the government should set a reasonable price for the product they funded. A high enough price to fund manufacturing, a low enough price to ensure that people who need the treatment have ready access to it. If the upper bound on price is too low for universal access, that's what subsidies are for. Instead, we have free money to bootstrap extractive capitalists, at cost and detriment to people who need care.
  - brigandish 4y ago
    > No, the government should set a reasonable price for the product they funded. Do the investors at the company you work at set the prices for the products you produce? That would be strange. > Instead, we have free money to bootstrap extractive capitalists, at cost and detriment to people who need care. It's "free" money because the capital costs are high and it's risky. I don't think it's the only or the best way but it is a valid way, but it doesn't remove the right to make a profit. As to it being "detriment[al]" to the people who need care, they're getting a drug that didn't exist before, right? And this also should (generally) make existing drugs cheaper, right?
- jlarocco 4y ago
  > Should the government have not helped fund this drug because now it's expensive? If he wants to charge "what the market will bear," then he should fund the research through the market. If he wants government handouts to do the research then the public deserves to get the benefit that it's paying for - we're not funding it to make some guy rich. I'm not saying it should be free, but he's already opted out of the market, so he loses out on market pricing. Manufacturing cost plus some reasonable percentage for the creator.
  - brigandish 4y ago
    I'm all for cutting subsidies, but the problem is that if you want risky things then investors might decide it's better not to invest and the drugs never appear. The government (which is really a government of and for the people, right?;) gets what it wants - a new drug - and jobs are created, trade happens, taxes are levied, health improves leading to (theoretical) money saved, more hours worked, more taxes… There's no need to punish the creator by not letting them make money off of their creation just because the government was involved, the government is getting plenty out of their investment.
    - jlarocco 4y ago
      > I'm all for cutting subsidies, but the problem is that if you want risky things then investors might decide it's better not to invest and the drugs never appear. So? Nobody has a right to free money. If investors don't want to fund the research, and the researcher doesn't want to share the results with the public, then no money for them. They can go off and work on something else. > There's no need to punish the creator by not letting them make money off of their creation just because the government was involved, the government is getting plenty out of their investment. You're putting words in my mouth. I said the cost of government funded drugs should be the cost of manufacturing plus a percentage for the inventor. Second, that's not how government funding works. If the public funds a thing, then the public has a right to use that thing. If the inventor doesn't like it, then they shouldn't take funding from the government. Funny to see a pro-corporate welfare argument on HN.
nootropicat 4y ago
That's not the problem, that's the reason almost all medical development happens in America. Rich people from all around the world travel to American hospitals if they have serious health problems, not to public hospitals even in rich countries like Norway. Public healthcare works (poorly) as a way to distribute existing treatment, but is worthless at incentivizing development. Really, the entire world is unfairly parasitizing on Americans to fund medical research.
- machiaweliczny 4y ago
  Or rather America is siphoning market by having monopoly. My father works in pharma factory and wages have not risen almost at all since 20 years ago when it was bought by americans (by bribe to gov). Some drugs got 10x more expensive while workers and patients got it worse. This was ultra scam but even after change of owners it’s basically the same. Capitalism works only with competition. But competition is against capital owners short-term extractionism (or rather against ceos who feels need to justify their pay). IMO solution is to let workers vote on CEO pay changes and punish white collar crime better and many problems of capitalism might get solved. EDIT: IMO it won’t work as long as globalization can be exploited to suppress working class and avoid regulation
- bwb 4y ago
  That is not true, look up medical outcome data. Most of europe is far ahead or even with the USA.
  - caddemon 4y ago
    Unless you are looking at outcomes of only the top institutions it's not really what he was saying. The US has a bad system for the average person for sure, but that does not mean that the US doesn't have one of the best systems if you can afford the best care. If you have medical outcome data that disputes that specifically I'd be interested.
    - bwb 4y ago
      Why would you think the best hospitals in the USA outperform any other developed country's best hospitals? Especially when those countries already deliver better average results across the board. Why do you have this belief and what is it based on? One example of cancer outcomes on a per country basis: https://worldpopulationreview.com/country-rankings/cancer-survival-rates-by-country https://worldpopulationreview.com/country-rankings/cancer-su... Just google medical outcomes for any disease on a per country basis. Do you really think the best hospitals in France or somehow worse than the best hospitals in the USA? Especially when the best hospitals in the USA still have the same fundamental problems as the rest of the American system?
pkaye 4y ago
> That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants. Do the drug companies in Europe do any different though?
- xmodem 4y ago
  I mean, sort of? Except, not really, because, "what the market will bear" is determined by what governments can negotiate - there's no Medicare Part D tying their hands.
  - pkaye 4y ago
    But the companies are still greedy in Europe. Zolensma one of the most expensive drugs is from Europe. Those companies sell it for what its worth. When Joe Biden proposed covid vaccine patent waivers, European leaders were quick to suck with with the corporations in opposition.

abeppu 4y ago

But so two patients in different financial circumstances would both pay basically as much as they are able for a life-saving treatment, arriving at very different amounts, right? - that sounds a lot like ransom? - I think if they adopt a policy of price-discrimination to the point of literally taking you for all (or most) of what you're worth (or projected to be worth), we should turn around and apply the same reasoning to corporate tax rates.