5 ms·

US pharma already benefits from academic research which is paid for by tax money. This is a classic example of socializing the costs and privatizing the profits

by lvl155 2y ago

US pharma already benefits from academic research which is paid for by tax money. This is a classic example of socializing the costs and privatizing the profits. Often times, you’re looking at 10-100x the cost for “statistically significant” uplift in efficacy. What happened to value-based medicine?

gruez 2y ago
Nobody is forcing you to buy the more expensive drug. You can always use the older generic version.
- mesk 2y ago
  Well, 'somebody' might be forcing you, the illness itself, because the generic drug might not be good enough in your case.
  - gruez 2y ago
    >because the generic drug might not be good enough in your case. The comment I was replying to: >Often times, you’re looking at 10-100x the cost for “statistically significant” uplift in efficacy. What happened to value-based medicine? If that's the case, sounds like the extra cost is worth it.
- murphyslab 2y ago
  You cannot always obtain a generic version; sometimes not even the original version. Drug manufacturers regularly take approved medicines, which are off-patent and non-exclusive, due to safety reasons (side-effects, risks to patients) or due to commercial reasons: high cost of production, low demand, or possibly to increase demand for an exclusive alternative. The FDA maintains a list of "List of Off-Patent, Off-Exclusivity Drugs without an Approved Generic": https://www.fda.gov/drugs/abbreviated-new-drug-application-anda/list-patent-exclusivity-drugs-without-approved-generic https://www.fda.gov/drugs/abbreviated-new-drug-application-a... See also: https://en.wikipedia.org/wiki/List_of_withdrawn_drugs https://en.wikipedia.org/wiki/List_of_withdrawn_drugs There are also perverse incentives at play and it often isn't easy to get a generic approved, especially if the original drug was already removed from market, under biosimilar regulations: https://prospect.org/health/2024-03-14-novo-nordisk-discontinues-insulin-levemir/ https://prospect.org/health/2024-03-14-novo-nordisk-disconti...
  - gruez 2y ago
    >Drug manufacturers regularly take approved medicines, which are off-patent and non-exclusive, due to safety reasons (side-effects, risks to patients) or due to commercial reasons: high cost of production Sounds like the new drug is providing value, contrary to what the parent poster is claiming. > or possibly to increase demand for an exclusive alternative. Aren't generics typically produced by a manufacturer other than the original manufacturer? Sure, the original manufacturer might have a generics division to compete with generics, but if they're the sole provider there's no reason to offer a generic to undercut their brand-name variant. This theory makes no sense.
    - drdeca 2y ago
      When a drug first stops being protected by a patent, in order for another company to begin making a generic version, they have to pay some up-front costs (of course). If the government requirements for starting a generic for it are particularly stringent, it seems like these up-front costs might be particularly high? I feel like there may be a strategy stealing argument that might apply here? If it would be profitable for another company to pay the upfront costs to produce a new generic, then it seems like the company that is already producing the drug could undercut them, by producing the same drug as they are already making. (perhaps under a different brand name as they were already doing?) This seems like it would discourage other companies from trying, as there might be a significant chance they don’t recoup their up-front cost? If the company with the patent releases a new improved version of the drug, which is under a new patent, it seems like they could potentially phase the old one out of production, getting people on to the new one? If they didn’t need to lower the price of the old one due to no generic being produced, then even if the improvements are marginal, it might not be hard to get people to switch to the improved-and-still-under-patent version (just by telling people it is an improvement and that old version might not be available soon). If they then stop producing the old version, then a company that makes generics could then make a generic without worrying about being undercut by the original company, but if people are switched to the improved version, will they notice that there is a generic of the version they used to take, and, if so, will they trust it? Maybe? I don’t know. Maybe they would. (Oh, especially if the out-of-pocket price is the same, due to insurance, they might be less inclined to try switching to it..) If it is unclear whether people would switch to it, then the company considering making the generic has a significant wager to make. Would they make it? Maybe they would. Maybe the chain of events I described falls apart at some point. I don’t think it is obvious that it does, but it seems reasonably likely that this chain I described doesn’t work and isn’t a real phenomenon. But I don’t think it obviously doesn’t work.
varispeed 2y ago
"privatising profits" is a bit vague term. May suggest that simply everyone but government benefits. I think it's better to say that it is socialising losses and making the rich richer.
someNameIG 2y ago
The vast majority of the costs aren't in the early stages that happen at academic institutions.
- lvl155 2y ago
  No. 99% of the costs are put on patients who take these drugs that are often ineffective. Heck, they give dying patients placebos. Yes, patients are willing to give up everything to live (and sometimes merely for weeks/months), and pharma is using them for experiments. Do you want to put a price on that? What a cynical thing to say. This isn’t some AB testing for a new web app feature.
  - someNameIG 2y ago
    I'm not sure what you're saying, are you against clinical trials?
- consteval 2y ago
  I think they could be, because I think you're looking for that 1/1000. Doing 1000 things and throwing away 999 is expensive. So sure, when you look at that 1/1000 you might say "oh the 1 isn't expensive". But you're also paying for the 999, and you have to in order to get that 1.
  - someNameIG 2y ago
    True that a big part of the cost is absorbing the costs of failed drugs, but most of it is in clinical trials, which is normally past the academia setting.
    - consteval 2y ago
      If I had to guess, a tiny tiny percent of all potential drugs make it to clinical trails. So again, now you're looking at 1 in 10,000. You're only looking at the 1, ignoring the 9,999, and saying "look pharma pays for all of it!" How much research at unis ends up being completely worthless from a pharmaceutical product perspective? Almost all of it. But how many products began based on research conducted at universities? ... all of them.
slashdave 2y ago
Most of the costs of drug development involve clinical trials. Basically none of that is supported by academic research because it is so expensive.
- lvl155 2y ago
  That’s such a cynical thing to say. I guess in your mind, drug companies carry out these trials in a complete vacuum. Patients take on all the risks.
- sudosysgen 2y ago
  We spend more money on the NIH alone than on drug trials. This is completely false. The trick here is that you exclude fundamental research by definition when you talk about "drug development". But the fundamental research is necessary for drug development, and it's just as if not more expensive.
  - slashdave 2y ago
    Most in the industry would not include fundamental research in drug development, so it's not just me. That said, fundamental research is very important, and so is the NIH. The NIH also funds many clinical trials, specifically those that the industry is not willing to.
    - sudosysgen 2y ago
      Sure, and that's a choice that's useful to the industry. It doesn't change that the fundamental research is a necessary part of the drug development process, and that our taxes pay for because the industry won't and can't.

by lvl155 2y ago

gruez 2y ago

Nobody is forcing you to buy the more expensive drug. You can always use the older generic version.

mesk 2y ago
Well, 'somebody' might be forcing you, the illness itself, because the generic drug might not be good enough in your case.
- gruez 2y ago
  >because the generic drug might not be good enough in your case. The comment I was replying to: >Often times, you’re looking at 10-100x the cost for “statistically significant” uplift in efficacy. What happened to value-based medicine? If that's the case, sounds like the extra cost is worth it.
murphyslab 2y ago
You cannot always obtain a generic version; sometimes not even the original version. Drug manufacturers regularly take approved medicines, which are off-patent and non-exclusive, due to safety reasons (side-effects, risks to patients) or due to commercial reasons: high cost of production, low demand, or possibly to increase demand for an exclusive alternative. The FDA maintains a list of "List of Off-Patent, Off-Exclusivity Drugs without an Approved Generic": https://www.fda.gov/drugs/abbreviated-new-drug-application-anda/list-patent-exclusivity-drugs-without-approved-generic https://www.fda.gov/drugs/abbreviated-new-drug-application-a... See also: https://en.wikipedia.org/wiki/List_of_withdrawn_drugs https://en.wikipedia.org/wiki/List_of_withdrawn_drugs There are also perverse incentives at play and it often isn't easy to get a generic approved, especially if the original drug was already removed from market, under biosimilar regulations: https://prospect.org/health/2024-03-14-novo-nordisk-discontinues-insulin-levemir/ https://prospect.org/health/2024-03-14-novo-nordisk-disconti...
- gruez 2y ago
  >Drug manufacturers regularly take approved medicines, which are off-patent and non-exclusive, due to safety reasons (side-effects, risks to patients) or due to commercial reasons: high cost of production Sounds like the new drug is providing value, contrary to what the parent poster is claiming. > or possibly to increase demand for an exclusive alternative. Aren't generics typically produced by a manufacturer other than the original manufacturer? Sure, the original manufacturer might have a generics division to compete with generics, but if they're the sole provider there's no reason to offer a generic to undercut their brand-name variant. This theory makes no sense.
  - drdeca 2y ago
    When a drug first stops being protected by a patent, in order for another company to begin making a generic version, they have to pay some up-front costs (of course). If the government requirements for starting a generic for it are particularly stringent, it seems like these up-front costs might be particularly high? I feel like there may be a strategy stealing argument that might apply here? If it would be profitable for another company to pay the upfront costs to produce a new generic, then it seems like the company that is already producing the drug could undercut them, by producing the same drug as they are already making. (perhaps under a different brand name as they were already doing?) This seems like it would discourage other companies from trying, as there might be a significant chance they don’t recoup their up-front cost? If the company with the patent releases a new improved version of the drug, which is under a new patent, it seems like they could potentially phase the old one out of production, getting people on to the new one? If they didn’t need to lower the price of the old one due to no generic being produced, then even if the improvements are marginal, it might not be hard to get people to switch to the improved-and-still-under-patent version (just by telling people it is an improvement and that old version might not be available soon). If they then stop producing the old version, then a company that makes generics could then make a generic without worrying about being undercut by the original company, but if people are switched to the improved version, will they notice that there is a generic of the version they used to take, and, if so, will they trust it? Maybe? I don’t know. Maybe they would. (Oh, especially if the out-of-pocket price is the same, due to insurance, they might be less inclined to try switching to it..) If it is unclear whether people would switch to it, then the company considering making the generic has a significant wager to make. Would they make it? Maybe they would. Maybe the chain of events I described falls apart at some point. I don’t think it is obvious that it does, but it seems reasonably likely that this chain I described doesn’t work and isn’t a real phenomenon. But I don’t think it obviously doesn’t work.

varispeed 2y ago

"privatising profits" is a bit vague term. May suggest that simply everyone but government benefits. I think it's better to say that it is socialising losses and making the rich richer.

someNameIG 2y ago

The vast majority of the costs aren't in the early stages that happen at academic institutions.

lvl155 2y ago
No. 99% of the costs are put on patients who take these drugs that are often ineffective. Heck, they give dying patients placebos. Yes, patients are willing to give up everything to live (and sometimes merely for weeks/months), and pharma is using them for experiments. Do you want to put a price on that? What a cynical thing to say. This isn’t some AB testing for a new web app feature.
- someNameIG 2y ago
  I'm not sure what you're saying, are you against clinical trials?
consteval 2y ago
I think they could be, because I think you're looking for that 1/1000. Doing 1000 things and throwing away 999 is expensive. So sure, when you look at that 1/1000 you might say "oh the 1 isn't expensive". But you're also paying for the 999, and you have to in order to get that 1.
- someNameIG 2y ago
  True that a big part of the cost is absorbing the costs of failed drugs, but most of it is in clinical trials, which is normally past the academia setting.
  - consteval 2y ago
    If I had to guess, a tiny tiny percent of all potential drugs make it to clinical trails. So again, now you're looking at 1 in 10,000. You're only looking at the 1, ignoring the 9,999, and saying "look pharma pays for all of it!" How much research at unis ends up being completely worthless from a pharmaceutical product perspective? Almost all of it. But how many products began based on research conducted at universities? ... all of them.

slashdave 2y ago

Most of the costs of drug development involve clinical trials. Basically none of that is supported by academic research because it is so expensive.

lvl155 2y ago
That’s such a cynical thing to say. I guess in your mind, drug companies carry out these trials in a complete vacuum. Patients take on all the risks.
sudosysgen 2y ago
We spend more money on the NIH alone than on drug trials. This is completely false. The trick here is that you exclude fundamental research by definition when you talk about "drug development". But the fundamental research is necessary for drug development, and it's just as if not more expensive.
- slashdave 2y ago
  Most in the industry would not include fundamental research in drug development, so it's not just me. That said, fundamental research is very important, and so is the NIH. The NIH also funds many clinical trials, specifically those that the industry is not willing to.
  - sudosysgen 2y ago
    Sure, and that's a choice that's useful to the industry. It doesn't change that the fundamental research is a necessary part of the drug development process, and that our taxes pay for because the industry won't and can't.