6 ms·

You say all this, while the literal title of the article you're commenting on is "The cost of developing new drugs may be far lower than industry claims". I th

You say all this, while the literal title of the article you're commenting on is "The cost of developing new drugs may be far lower than industry claims". I think this comment perfectly proves that this is relevant. Manufacturing is quite relevant. If the actual cost of "discovered and proved effective" is far lower than claimed, then manufacturability becomes a concern. If the cost of discovery and proven effectiveness is borne by governments and universities, then the manufacturing is the only cost borne by the pharmaceutical companies.

pfdietz 3y ago
The article appears to imply that the direct cost of developing a successful drug is the relevant metric. It isn't; the cost must include the indirect costs of development on drugs that didn't pan out. And the vast majority of drug candidates don't pan out, often in Phase 3 trials where much of the cost has already been sunk. Put it another way: if making new drugs was so cheap and easy, drug companies would be doing that in competition with each other, and prices would be low as a result of that competition.
- vineyardmike 3y ago
  > if making new drugs was so cheap and easy, drug companies would be doing that in competition with each other They are. There is intense competition and lots of venture capital and research grants to fund research. > prices would be low as a result of that competition. Why? Patents end competition as soon as the research is successful. They have to compete to research the drug - and we see a vibrant competitive market for research - but they don't have to compete to sell the drug. We see this even when there are multiple brands competing to sell generic versions of drugs they didn't discover or spend R&D on. There is simply no market forces to lower medically necessary drug prices. The market is captive (people will die without certain medication), and thanks to patents, there is often no competition for years to allow people to price shop. I can buy ibuprofen or acetaminophen or aspirin for cheap at any drug store, because there is a competitive market for OTC pain meds. There is no OTC market for insulin, and people will die without it. Unsurprisingly, insulin is much more expensive, despite being discovered by a university and being over 100 years old. PreP (prevents HIV) research was entirely funded by US taxes, and the pills costs $2000/mo - despite being available from multiple companies including available as a generic. Why are companies that didn't pay to research the drug (and didn't take US Gov money to research it) charging $2000/mo? The only cost they incurred was manufacturing.
  - pfdietz 3y ago
    > Why? Patents end competition as soon as the research is successful. One can get a patent on a drug, but not on other drugs treating the same condition. We see many similar drugs developed that don't infringe each others' patents. If they are all effective, then the drug makers will be competing with each other, even if the drugs are under patent protection.
  - nradov 3y ago
    Generic insulin has been available since 2019. https://investor.lilly.com/news-releases/news-release-details/lillys-lower-priced-insulin-now-available https://investor.lilly.com/news-releases/news-release-detail...
    - pfdietz 3y ago
      Since long before that. It depends on exactly what you mean by "insulin".
renewiltord 3y ago
Yeah, I was discussing this with my wife the other day. She spent about 10 minutes looking for a doodad and when she eventually found it, I was quite surprised. It took mere seconds to open that last drawer where she found it. She could have just opened it first and saved herself almost all of the 10 minutes. It was a learning experience: always look in the place where the thing is. It saves a lot of time. Her problem was that she first checked all the places it wasn't.
- aspenmayer 3y ago
  It’s always the last place you look, because you’d need to have lost your mind to keep looking after you’d found it. This is true even if you find it the first place you look. A big part of the issue is too readily discounting or assuming where it isn’t too early. It’s often better to methodically search sections and areas at a time in a thorough process of elimination even of places you know it isn’t, just as a matter of practicality, and so the process of elimination is actually fully eliminating possibilities, and not just confirming biases.
- vineyardmike 3y ago
  What if your friend visited your house, and on the way inside, you told them "if you're ever looking for a doodad, it is in the third drawer on the left". What's a reasonable amount of time for your friend to spend looking for a doodad, and how would you treat a friend that asked for an hour to retrieve it? I assume this is all an analogy for the cost of research, and how not every research opportunity pans out? I think it's a cute analogy, but we have plenty of drugs that are decades old, research costs long paid off, and people die because they can't afford them. This isn't an economics 101 essay prompt, the costs of medicine have life-or-death implications. As the go-to example, insulin was discovered in a university more than 100 years ago. The patent was famously sold for $1, so the research "cost" to the drug companies is negligible. The price didn't decrease in the US until 2023, when the government capped the price at $35/mo - an 70+% reduction. The cost in other countries is still less than 30% of the US price. This is basically the equivalent to someone telling your wife where the doodad was, and her pretending it takes 10 minutes to find. PreP, which prevents HIV, was entirely funded by the US Government - both research and manufacturing costs - and its manufactured by several companies who weren't involved in the research. The average prescription cost was >2000/mo from every source until the government stepped in. That's more than some people's monthly salary. This is basically like someone handing the doodad to your wife, and her pretending it is a full-time job to find.

pfdietz 3y ago

The article appears to imply that the direct cost of developing a successful drug is the relevant metric. It isn't; the cost must include the indirect costs of development on drugs that didn't pan out. And the vast majority of drug candidates don't pan out, often in Phase 3 trials where much of the cost has already been sunk. Put it another way: if making new drugs was so cheap and easy, drug companies would be doing that in competition with each other, and prices would be low as a result of that competition.

vineyardmike 3y ago
> if making new drugs was so cheap and easy, drug companies would be doing that in competition with each other They are. There is intense competition and lots of venture capital and research grants to fund research. > prices would be low as a result of that competition. Why? Patents end competition as soon as the research is successful. They have to compete to research the drug - and we see a vibrant competitive market for research - but they don't have to compete to sell the drug. We see this even when there are multiple brands competing to sell generic versions of drugs they didn't discover or spend R&D on. There is simply no market forces to lower medically necessary drug prices. The market is captive (people will die without certain medication), and thanks to patents, there is often no competition for years to allow people to price shop. I can buy ibuprofen or acetaminophen or aspirin for cheap at any drug store, because there is a competitive market for OTC pain meds. There is no OTC market for insulin, and people will die without it. Unsurprisingly, insulin is much more expensive, despite being discovered by a university and being over 100 years old. PreP (prevents HIV) research was entirely funded by US taxes, and the pills costs $2000/mo - despite being available from multiple companies including available as a generic. Why are companies that didn't pay to research the drug (and didn't take US Gov money to research it) charging $2000/mo? The only cost they incurred was manufacturing.
- pfdietz 3y ago
  > Why? Patents end competition as soon as the research is successful. One can get a patent on a drug, but not on other drugs treating the same condition. We see many similar drugs developed that don't infringe each others' patents. If they are all effective, then the drug makers will be competing with each other, even if the drugs are under patent protection.
- nradov 3y ago
  Generic insulin has been available since 2019. https://investor.lilly.com/news-releases/news-release-details/lillys-lower-priced-insulin-now-available https://investor.lilly.com/news-releases/news-release-detail...
  - pfdietz 3y ago
    Since long before that. It depends on exactly what you mean by "insulin".

renewiltord 3y ago

Yeah, I was discussing this with my wife the other day. She spent about 10 minutes looking for a doodad and when she eventually found it, I was quite surprised. It took mere seconds to open that last drawer where she found it. She could have just opened it first and saved herself almost all of the 10 minutes. It was a learning experience: always look in the place where the thing is. It saves a lot of time. Her problem was that she first checked all the places it wasn't.

aspenmayer 3y ago
It’s always the last place you look, because you’d need to have lost your mind to keep looking after you’d found it. This is true even if you find it the first place you look. A big part of the issue is too readily discounting or assuming where it isn’t too early. It’s often better to methodically search sections and areas at a time in a thorough process of elimination even of places you know it isn’t, just as a matter of practicality, and so the process of elimination is actually fully eliminating possibilities, and not just confirming biases.
vineyardmike 3y ago
What if your friend visited your house, and on the way inside, you told them "if you're ever looking for a doodad, it is in the third drawer on the left". What's a reasonable amount of time for your friend to spend looking for a doodad, and how would you treat a friend that asked for an hour to retrieve it? I assume this is all an analogy for the cost of research, and how not every research opportunity pans out? I think it's a cute analogy, but we have plenty of drugs that are decades old, research costs long paid off, and people die because they can't afford them. This isn't an economics 101 essay prompt, the costs of medicine have life-or-death implications. As the go-to example, insulin was discovered in a university more than 100 years ago. The patent was famously sold for $1, so the research "cost" to the drug companies is negligible. The price didn't decrease in the US until 2023, when the government capped the price at $35/mo - an 70+% reduction. The cost in other countries is still less than 30% of the US price. This is basically the equivalent to someone telling your wife where the doodad was, and her pretending it takes 10 minutes to find. PreP, which prevents HIV, was entirely funded by the US Government - both research and manufacturing costs - and its manufactured by several companies who weren't involved in the research. The average prescription cost was >2000/mo from every source until the government stepped in. That's more than some people's monthly salary. This is basically like someone handing the doodad to your wife, and her pretending it is a full-time job to find.