Gary Farber's home blog is Amygdala.
Drug companies, who are addicted to government-granted patent monopolies.
It is mainly because of this resistance that drug companies are now blanketing us with public relations messages. And the magic words, repeated over and over like an incantation, are research, innovation, and American. Research. Innovation. American. It makes a great story. But while the rhetoric is stirring, it has very little to do with reality. First, research and development (R&D) is a relatively small part of the budgets of the big drug companies—dwarfed by their vast expenditures on marketing and administration, and smaller even than profits.Really? What are the numbers?
Drug industry expenditures for research and development, while large, were consistently far less than profits. For the top ten companies, they amounted to only 11 percent of sales in 1990, rising slightly to 14 percent in 2000. The biggest single item in the budget is neither R&D nor even profits but something usually called "marketing and administration"—a name that varies slightly from company to company. In 1990, a staggering 36 percent of sales revenues went into this category, and that proportion remained about the same for over a decade.13 Note that this is two and a half times the expenditures for R&D.Earlier:
The most startling fact about 2002 is that the combined profits for the ten drug companies in the Fortune 500 ($35.9 billion) were more than the profits for all the other 490 businesses put together ($33.7 billion).Later:
In the 1990s, Congress enacted other laws that further increased the patent life of brand-name drugs. Drug companies now employ small armies of lawyers to milk these laws for all they're worth—and they're worth a lot. The result is that the effective patent life of brand-name drugs increased from about eight years in 1980 to about fourteen years in 2000.10 For a blockbuster—usually defined as a drug with sales of over a billion dollars a year (like Lipitor or Celebrex or Zoloft)—those six years of additional exclusivity are golden. They can add billions of dollars to sales—enough to buy a lot of lawyers and have plenty of change left over. No wonder big pharma will do almost anything to protect exclusive marketing rights, despite the fact that doing so flies in the face of all its rhetoric about the free market.Assertions supported at length in the article:
Second, the pharmaceutical industry is not especially innovative. As hard as it is to believe, only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH). The great majority of "new" drugs are not new at all but merely variations of older drugs already on the market. These are called "me-too" drugs. The idea is to grab a share of an established, lucrative market by producing something very similar to a top-selling drug.And:
Third, the industry is hardly a model of American free enterprise. To be sure, it is free to decide which drugs to develop (me-too drugs instead of innovative ones, for instance), and it is free to price them as high as the traffic will bear, but it is utterly dependent on government-granted monopolies—in the form of patents and Food and Drug Administration (FDA)–approved exclusive marketing rights. If it is not particularly innovative in discovering new drugs, it is highly innovative— and aggressive—in dreaming up ways to extend its monopoly rights.Of course:And there is nothing peculiarly American about this industry. It is the very essence of a global enterprise. Roughly half of the largest drug companies are based in Europe. (The exact count shifts because of mergers.) In 2002, the top ten were the American companies Pfizer, Merck, Johnson & Johnson, Bristol-Myers Squibb, and Wyeth (formerly American Home Products); the British companies GlaxoSmithKline and AstraZeneca; the Swiss companies Novartis and Roche; and the French company Aventis (which in 2004 merged with another French company, Sanafi Synthelabo, putting it in third place).5 All are much alike in their operations. All price their drugs much higher here than in other markets.
Since the United States is the major profit center, it is simply good public relations for drug companies to pass themselves off as American, whether they are or not. It is true, however, that some of the European companies are now locating their R&D operations in the United States. They claim the reason for this is that we don't regulate prices, as does much of the rest of the world. But more likely it is that they want to feed on the unparalleled research output of American universities and the NIH. In other words, it's not private enterprise that draws them here but the very opposite—our publicly sponsored research enterprise.
If prescription drugs were like ordinary consumer goods, all this might not matter very much. But drugs are different. People depend on them for their health and even their lives. In the words of Senator Debbie Stabenow (D-Mich.), "It's not like buying a car or tennis shoes or peanut butter." People need to know that there are some checks and balances on this industry, so that its quest for profits doesn't push every other consideration aside. But there aren't such checks and balances.Research. Innovation. American. Did you know:
Even worse is the fact that there are very few drugs in the pipeline ready to take the place of blockbusters going off patent. In fact, that is the biggest problem facing the industry today, and its darkest secret. All the public relations about innovation is meant to obscure precisely this fact. The stream of new drugs has slowed to a trickle, and few of them are innovative in any sense of that word. Instead, the great majority are variations of oldies but goodies—"me-too" drugs. Of the seventy-eight drugs approved by the FDA in 2002, only seventeen contained new active ingredients, and only seven of these were classified by the FDA as improvements over older drugs. The other seventy-one drugs approved that year were variations of old drugs or deemed no better than drugs already on the market. In other words, they were me-too drugs. Seven of seventy-eight is not much of a yield. Furthermore, of those seven, not one came from a major US drug company.Own pharma stock? No worries!
How is the pharmaceutical industry responding to its difficulties? One could hope drug companies would decide to make some changes—trim their prices, or at least make them more equitable, and put more of their money into trying to discover genuinely innovative drugs, instead of just talking about it. But that is not what is happening. Instead, drug companies are doing more of what got them into this situation. They are marketing their me-too drugs even more relentlessly. They are pushing even harder to extend their monopolies on top-selling drugs. And they are pouring more money into lobbying and political campaigns. As for innovation, they are still waiting for Godot.Don't you love a happy ending?
Okay, let's close with a prescription, instead:
For example, we need to get the industry to focus on discovering truly innovative drugs instead of turning out me-too drugs (and spending billions of dollars to promote them as though they were miracles). The me-too business is made possible by the fact that the FDA usually approves a drug only if it is better than a placebo. It needn't be better than an older drug already on the market to treat the same condition; in fact, it may be worse. There is no way of knowing, since companies generally do not test their new drugs against older ones for the same conditions at equivalent doses. (For obvious reasons, they would rather not find the answer.) They should be required to do so.The recent move to mandate that results of clinical drug trials be publically available in a federal registry is a small step in the right direction.The me-too market would collapse virtually overnight if the FDA made approval of new drugs contingent on their being better in some important way than older drugs already on the market. Probably very few new drugs could meet that test. By default, then, drug companies would have to concentrate on finding truly innovative drugs, and we would finally find out whether this much-vaunted industry is turning out better drugs. A welcome by-product of this reform is that it would also reduce the incessant and enormously expensive marketing necessary to jockey for position in the me-too market. Genuinely important new drugs do not need much promotion (imagine having to advertise a cure for cancer).
A second important reform would be to require drug companies to open their books. Drug companies reveal very little about the most crucial aspects of their business. We know next to nothing about how much they spend to bring each drug to market or what they spend it on. (We know that it is not $802 million, as some industry apologists have recently claimed.) Nor do we know what their gigantic "marketing and administration" budgets cover. We don't even know the prices they charge their various customers. Perhaps most important, we do not know the results of the clinical trials they sponsor—only those they choose to make public, which tend to be the most favorable findings. (The FDA is not allowed to reveal the results it has.) The industry claims all of this is "proprietary" information. Yet, unlike other businesses, drug companies are dependent on the public for a host of special favors—including the rights to NIH-funded research, long periods of market monopoly, and multiple tax breaks that almost guarantee a profit. Because of these special favors and the importance of its products to public health, as well as the fact that the government is a major purchaser of its products, the pharmaceutical industry should be regarded much as a public utility.
Read The Rest Scale: 6 out of 5. This is a small part of a damned important article, and a matter of, literally, life and death for millions of people.
Wouldn't it be better for the government to get out of the way as much as possible? For example, allowing drugs to continue to be reimported from Canada. This would keep up the pressure on prices, right?
I this just sound bizarre...
bq. For example, we need to get the industry to focus on discovering truly innovative drugs instead of turning out me-too drugs.
This seems like the exact opposite of what the governmnet should be doing. Wouldn't this really serve to decrease competition within entire classes of drugs? How could this possibly be a good idea?
Gary Farber:
The article neglects what I think is a more persuasive argument: pharmaceutical companies by their behavior demonstrate that they do not consider research and development as instrumental to their core business. I did a little research not long ago that illustrated this. I looked at the R&D budgets and net revenues of the top five pharmaceutical companies based on annual statements. In each case although net revenues adjusted for inflation went up sharply, R&D expenses adjusted for inflation did not go up at all. In human terms the same researchers received cost of living increases but no new researchers were hired.
If pharmaceutical companies believed that R&D was an essential means of production for them, rational behavior would suggest that as net revenues increased so would R&D budgets. Their treatment of R&D suggests that management considers it as overhead—a fixed expense.
It's my suspicion that if you could look at lobbying expenses and related legal fees over the same period you would find that it increased faster than R&D budgets. But these numbers are dreadfully difficult to ferret out from published statements.
Wouldn't it be better for the government to get out of the way as much as possible?
The only way for government to get out of the way would be to get out of the patent and approval business altogether. I don't think that's a particularly good idea for a host of reasons. What I think should be done is that patent law should be changed to vary the term of a patent based on revenue derived. This might motivate pharmaceutical companies to put more attention into what is putatively their core business.
This is a good story that needs to be told. I agree with most everything you have stated, but I have a somewhat different take on the solution. The United States needs to put tighter restrictions on R & D conducted at our universities which are publically funded. You made the point very clear when you pointed out that not one American company produced a new drug. We are paying for other countries to profit from our tax money and then paying through the roof to use the products that we paid to develop.
This isn't just a problem in the drug industry, it spans across every major University in the country. It would be interesting to see all of the powerful people that have befriended the University Presidents and how they in turn lobby congress to get additional funding for their school research departments.
A perfect example of this would be the two scientists that announced in 1989 that they had produced energy through Cold Fusion. Various Universities including MIT set out to purposely discredit them. Link_PDF-MIT and Cold Fusion: A Special Report Why? MIT has the biggest research facility for Hot Fusion and they did not want to share with a new technology so never even gave a chance.
After 15 years of no funding and ridicule, the DOE has announced that it is finally going to take another look while countries like Italy, France, and China and our own SPAWAR military research facility have been produceing working models for years.
The Eleventh International Conference for Cold Fusion will be in France this year.
Link to Conference Information
Link to Wired Magazine Story
Cold Fusion Rides Again
Science magazine publishes more evidence of tabletop nuclear reactions
I can only imagine what's going on in other University Research facilities in order to keep their funding.
SBD
Really and how much (as a percentage of their sales) does the Medical Substances and Devices (Pharma’s sector) sector spend on R&D compared to the other major industrial sectors?
You’re making the assumption that this is being seen as an expense rather than an investment. When a company decides where to budget its resources, it looks at the ROI (return on investment) to see where it is most profitable. R&D while certainly essential tends to be rather risky and long-term while marketing can yield greater returns in terms of sales revenue. That doesn’t mean it’s an “either or” proposition but rather it does not necessarily follow that a company is going to increase it’s R&D budget to increase sales if more sales can be generated by investing it elsewhere.
Really and how much (as a percentage of their sales) does the Medical Substances and Devices (Pharma’s sector) sector spend on R&D compared to the other major industrial sectors?
That's irrelevant to this discussion.
That doesn’t mean it’s an “either or” proposition but rather it does not necessarily follow that a company is going to increase it’s R&D budget to increase sales if more sales can be generated by investing it elsewhere.
It seems that you're attacking what you're attempting to defend. The Constitutional purpose of patents is "to promote the progress of science and useful arts". However much the pharmaceutical companies are entitled to spend their money whereever they care to if they're not spending at least some of their increment on R&D it would seem to me that patent law needs reform.
Let's take a simple example. Farmer Brown grows both corn and sorghum. He receives a subsidy whose intent is that he grow more sorghum. If he spends it to grow more corn it seems pretty sensible to revisit the effectiveness of the subsidy. And that's what a patent—a subsidy.
One of the reasons pattent protection was extended was to account for the fact that the FDA takes so long to process drug applications.
The best way to stop drug company profiteering is to stop buying the drugs. You say your life depends on them? Then what ever they cost they are a fair value because 100 years ago you would be dead.
BTW one of the reasons drug development costs so much is that drugs must not only be proved safe - a relatively low cost endeavor, they must be proved effective vs a placebo - very expensive. Of course the more expensive the development the fewer drugs developed. This new requirement of effacasy was added about 30 years ago and give us the big pharma of today.
Say. You don't suppose our government is causing most of the problem? Nah. How could that be? They are only here to help.
It is not just the pattent incentive system that is driving this mess.
"Second, the pharmaceutical industry is not especially innovative. As hard as it is to believe, only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH). The great majority of "new" drugs are not new at all but merely variations of older drugs already on the market. These are called "me-too" drugs. "
They're called "me-too" drugs by those who don't understand or wish to obfuscate the issue. Those who are honest and knowledgeable call such drugs by their proper name: competitive drugs.
Outside the pharmaceutical industry, "me-too" products are regarded as healthy competition, helping drive cost down and quality up.
Did I mention the war on drugs and how it keeps big pharma from having to compete with pot in the anti-anxiety segment? That little subsidy is worth about $40 bn a year to big pharma. Surprisingly tthe pot segment of the WODs costs about $40 bn. So you get to pay through the nose twice. Did I mention lives ruined to keep big pharma in $$$$$$?
There is plenty wrong with our drug development system. Most of it is caused by government.
I'm with B. Rush - government out of medicine.
I concur with Thorley; Drug companies only spend a small portion of their profits on new research because the Return on Investment (ROI) for new research is quite small when one factors in the failures. Meanwhile, making a me-too drug is a much more predictable proposition (and not one to be downplayed, as it has beneficial effects for consumers, as noted by Lurker). Also, marketing existing drugs probably gives the greatest ROI of all for the drug companies.
The thing to keep in mind is that while marketing existing drugs has only minor benefits for consumers (maybe you start taking a helpful drug you didn't know you needed?) it keeps these companies profitable. Since they spend a predictable (small) fraction of their profits on R+D then more profit means more (potentially) more R+D. Less profit almost certainly means less R+D.
If you are interested in R+D, better drugs (even me-too drugs are improvements sometimes), and cheaper, more available drugs then you should be happy with successful, profitable drug companies.
Not to say that everything about the current system is perfect. The cost of drugs under patent are quite high due to the lack of competition. This is bad for the consumers of those drugs. However, in the long run, when the patent expires everyone can enjoy the lower price versions of the drug. Patents do give the drug companies a profitable monopoly, but only on NEW drugs, so in the long run they do promote research and development of new drugs. High prices today are a tradeoff for an incentive to innovate.
Banning the importation of drugs is simply a gov't enforced geographic monopoly that has no justifiable incentive value (that I have heard of). It does make more money for the drug companies, but it doesn't help consumers (unlike patent monopolies).
I humbly suggest that one question the prevailing assumptions that big corporations are evil. They tend to provide useful goods and services to consumers in a mostly competitive environment, driving costs down and quality up. We as consumers should make sure that our gov't keeps things competitive between corporations, and limits gov't enforced monopolies. We can also exercise some control over corporations by tuning our investments as we see fit -- if you think Evil Corp has an unfair advantage and is 'making too much money' then you may wish to buy their stock.
Cheers
--Fred
The study she cites to support this passage is (per the footnote) the Henry J. Kaiser Family Foundation, "Prescription Drug Trends," November 2001 which can be found here:
http://www.kff.org/rxdrugs/loader.cfm?url=/commonspot/security/getfile.cfm&PageID=13796
The comparison Marcia Angell cites is found on Exhibit 31 (Page 45) and it’s actually “Marketing, General, and Administrative” that she cites which is defined as “the costs of promoting and selling the goods plus general business expenses.” In other words everything but R&D and the Cost of Sales (“cost of raw materials and production costs for manufacturing the finished goods to be sold”) not just the parts used to market and promote the product which seems to be Marcia Angell’s contention. Kaiser to their credit actually did provide numbers and a breakdown on “Promotional Spending” (which would have been a more valid comparison than picking specific item from the budget like R&D and trying to compare with a catch all like MGA) that can be found here on Chart 9 of the Chart Book for this study.
http://www.kff.org/rxdrugs/loader.cfm?url=/commonspot/security/getfile.cfm&PageID=13709
In 2000, Promotional Spending was about 14% as a percentage of sales (about even with R&D) but what’s interesting and more useful is that it breaks down Promotional Spending into the Retail Value of Sampling (the cost of the free samples that you get from your physician), Detailing, and Advertising (both Journal and Direct-to-Consumer). The largest category has consistently been RVS which represents over half of Promotional Spending. In other words, over half of the cost of promoting pharmaceuticals is actually in giving away samples.
M. Simon, I will venture out on a limb, and suggest that you did not, in fact, actually read the article. Am I wrong?
If so, I apologize. If not, may I suggest you trouble to? (Incidentally, it's "patent.")
That was Benjamin not Bobby. The medical doctor not the communist idiot.
Dave Schuler wrote:
To which I naturally asked:To which Dave Schuler replied:
Actually it goes right to heart of what you considered to be a “more persuasive argument.” According to the Technology Administration’s study on “R&D Expenditures by Industry Category”, which you can find here:
http://www.nsf.gov/sbe/srs/nsf00301/expendit.htm
As a percentage of sales, the MSD sector has the highest level of R&D out of any industry sector (Figure 4). Which indicates that they consider R&D to be as “instrumental to their core business” as much as (if not more so) than other sectors since they spend a higher percentage of their total sales volume on it.
OK I admit two things
1. My spelling was never the best
2. I didn't read the article.
However, just to be sure it wasn't the usual hit job and had something really valuable to say (I know comming from the communists at the NYT Review of Books that is a stretch but for the sake of open mindednesss I decided to give it at minimum a moderate perusal). Alas. It is the same communist formula - evil corporations are robbing us blind. They are not spending their money the way I want them to etc.
What they fail to see (as usual) is that the system designed to regulate the drug industry has been captured by it. It happened to the ICC. Nothing new. Yet it surprises leftys every time. Well OK.
========================================And your prescription for the mess caused by the current rules is a new set of rules that will for sure fix it and lower costs. For sure. Really. There is proof. seriously. It will work this time. We have rules covering all the old abuses. 3,987 pages of rules. Which if the drug companies will comply, and we are charging them more to be sure the rules are enforced, will have to lower costs. Don't you see? Really. You just have to believe.
You want to end industry control of the drug regulators? Give the job to a UL like organization. Get it out of the hands of politicians who are not accountable for their votes.
A UL like organization at least has liability issues tending to keep them honest.
All political decisions are points of corruption. To minimize corruption minimize the areas politicians are allowed to meddle. This is not rocket science.
I used to buy into all that lefty stuff. Then I spent a few decades working in industry. About 10 to 20% of that for the military-industrial complex. I learned one important thing - the reason for $600 hammer is government rules. It wasn't evil industry causing the problems. It was laws designed to punish every one for the sins of a few. Most industry is honest. It costs too much to be otherwise. Generally.
What happened was the government made every micro step in the procurement process accountable. And of course you were required to charge the government for that accounting time and required paper work at specified rates. And why did you have to charge the government for that accounting? To prove you had done it. So now you have time keepers, accountants, lawyers etc. all involve in hours of labor to buy the hammer. It is not the hammer that is costing you. It is the accompanying paper work.
And so it goes.
As usual the customer has to pay for all that paper. One way or another.
BTW drug companies do not profit from government research. They profit by turning that research into a product and then selling it. Not exactly a low risk proposition given the FDA gauntlet, competition, unexpected side effects, etc. It is not a gimmee.
Thorley's comment on what is included in Marketing and Administration is right on point. There are huge and wholly legitimate costs to running a business that don't take place in a lab.
I don't really understand the direction the article wants to go in its critique of patents. I'm willing to discuss the concept that patent periods should be somewhat shorter or longer, but the article seems to allude to a more general dissatisfaction with patents that is unwarranted.
This quote strikes me as awful: "It needn't be better than an older drug already on the market to treat the same condition; in fact, it may be worse. There is no way of knowing, since companies generally do not test their new drugs against older ones for the same conditions at equivalent doses. (For obvious reasons, they would rather not find the answer.) They should be required to do so."
Umm if it isn't better it isn't very likely to sell well. And you had better count 'different side effects' as better too. Unless you are positing that doctors are too weak-willed to resist advertising. And are we really suggesting that the FDA approval process ought to be HARDER? Really? Anyone want to comment on the idea that a tougher FDA approval process will make things more expensive?
"A welcome by-product of this reform is that it would also reduce the incessant and enormously expensive marketing necessary to jockey for position in the me-too market. Genuinely important new drugs do not need much promotion (imagine having to advertise a cure for cancer)."
Sentences like this make me worry that the writer doesn't understand science. 'A cure for cancer'? Which cancer? I'll hope it was hyperbole instead of ignorance. Also economics. Competition among drugs DRIVES DOWN PRICES.
And this quote is just nuts: "We don't even know the prices they charge their various customers. Perhaps most important, we do not know the results of the clinical trials they sponsor—only those they choose to make public, which tend to be the most favorable findings. (The FDA is not allowed to reveal the results it has.) The industry claims all of this is "proprietary" information. Yet, unlike other businesses, drug companies are dependent on the public for a host of special favors—including the rights to NIH-funded research, long periods of market monopoly, and multiple tax breaks that almost guarantee a profit."
Don't know the prices they charge their customers? That is one of the most closely guarded secrets in almost any company that sells products to different customers.
The author makes it sound like the FDA hides results. It doesn't allow drugs with dangerous results on the market. Isn't that enough?
Long periods of monopoly? The FDA process makes certain that drug companies get less monopoly power than most inventors.
Almost guarantee a profit? Excuse me? Drug companies go bankrupt all the time. San Diego is one of the biggest pharma research areas in the world and our research companies fold ALL THE TIME.
I highly reccommend that everyone peruse Derek Lowe's posts on research if you want to get a good perspective on why drug research costs so much. A good start is here . He has better summary posts, but this was the easiest for me to find because I linked it in my own archives.
This paper should put things more into perspective. I included a few paragraphs.
Russell W. Bessette, M.D., Executive Director
New York State Office of Science, Technology and Academic Research
On the Importance of Technology Transfer
February 2, 2004
According to a survey by the Association of University Technology Managers (AUTM), New York State is the home to three of the top 10 universities in the U.S. receiving licensing income for inventions and innovations. First in the nation was Columbia University, earning $155.6 million in licensing income in 2002, followed by New York University (ranked third) with $62.7 million in licensing income and the University of Rochester (ranked sixth) with $42.1 million in licensing income.
Two decades ago the foundation for technology transfer from universities was laid with the enactment of the Bayh-Dole Act. This Act has been directly credited with helping spark university technology transfer by giving universities the right to own and patent inventions developed under federally funded research programs. Prior to Bayh-Dole, according to AUTM, fewer than 250 U.S. patents were issued to universities each year. Since 1993, U.S. universities have averaged more than 1,600 U.S. patents annually. In recent years, patents issued to U.S. universities have exceeded 2,000 annually.
Since 1995, the Governor and the Legislature have fostered the growth of New York's high-technology industries by supporting the investment of more than $1 billion in such critically important scientific fields as computer chips, bioinformatics, photonics, information technology, biotechnology, nanotechnology, optoelectronics and a host of other technologies as a way to foster economic growth and create new jobs and new companies.
Since 1988, academic research has yielded 1,507 new products including: Taxol, the most important cancer drug in 15 years, according to the National Cancer Institution; artificial lung surfactant, which each year saves 20,000 babies born with collapsed lungs; the DNA sequencer, the basis of the entire Human Genome Project; and Lycos, the online search engine and resource guide.
This is why the President of the University has become more important and more powerful. It is now their job to get the R & D money from the government to produce patents.
Does anyone else see any problems here??
SBD
To put this in perspective, at about the time the FDA guidelines changes to encourage pharmaceutical companies to pay more attention to the differences in reactions (and side effects) between men, women, and children; pharmaceutical companies began to design or redesign drugs to take some of these differences into account. Hence many of the “me-too” drugs which BTW account for only about 20% of Pharma’s R&D spending. The Society for Women’s Health Research details some of the differences and the benefits they create:
Bottom line, spending by Pharma’ on improvements and/or changes on existing drugs actually accounts for about 20% of their R&D spending. The overall effect of this has been cheaper not more expensive pharmaceuticals (BTW: I don’t believe that this would affect the ability to market generic version of the original drug which make up about half of all prescription drugs used, but if there any patent attorneys in the house, they can verify this) and this trend occurred at about the time that the FDA began to promote the importance of testing among more diverse groups. Many of the “me-too” drugs actually use different delivery mechanisms, can be taken at different dosage levels and enable more people to gain the benefits that come from prescription drugs with fewer potential side effects.
"Umm if it isn't better it isn't very likely to sell well."
That seems difficult to support, though if you have evidence, I'm perfectly prepared to hear it, of course. Would you argue that the market -- patients and doctors -- have/has sufficient knowledge of the objective comparative merits of the different drugs for this to be so? Have you been following the recent news about how, in fact, clinical drug trial results are often neither objectively studied nor made publically available? Without such data, such judgements cannot help but be made in partial ignorance.
Not to mention that advertising budgets and other non-medical reasons are, of course, highly influential; surely you not argue otherwise?
"Unless you are positing that doctors are too weak-willed to resist advertising...."
In some cases, of course that's so; doctors don't come equipped with Magic Inhuman Resistance, and, in fact, tend to be extremely busy and tired people. And the pharma industry offers innumerable well-documented, um, inducements.
"And are we really suggesting that the FDA approval process ought to be HARDER?"
No.
"The author makes it sound like the FDA hides results."
No, the companies hide results; the FDA is presently powerless to do anything about that, though the relevant Senate committee has been discussing a mandatory regristry, as has been much in the news, as I previously pointed out.
SBD, it would be helpful if you would format your comment in a way -- any of the dozen possible ways -- that makes clear when you are quoting, and when you are writing your own words; not doing so will make for extremely confused conversations if anyone cares to respond to such an unclear post.
The best way to control drug prices is to remove the disconnect between the cost and payment of the drug.
Stop insurance coverage for prescription drugs.
Once patients are responsible for the full payment, they have a big incentive to pick the cheapest drug that works. Pricing will start to play a much larger role in drug selection than TV ads or pharm rep lunches.
With the money saved by not having to cover drugs at inflated prices, insurance companies could offer lower premiums, putting more money in the hand of the consumer to make their own choices.
Here's some examples:
Treating pharyngitis
Zithromax Tri-pack (3 500 mg tab)$43.46
amoxicillin (30 500 mg tab) $8.99
or osteoarthritis
Vioxx (30 25 mg tab) $77.99
naproxen (60 500 mg tab) $17.99
I've got patients demanding the Z-pack when a course of amoxicillin would suffice. Not that there's anything wrong with the Z-pack, but they're not paying for it (and everyone else is).
Slightly off topic, yes.
For me, a more powerful source of worry is that 10% of US drugs are counterfeit and 25% of EU are also counterfeit. Add in to that that the majority of drugs reaching the 3rd world are completely fake is a more serious concern. Sure, there is a concern of misrepresentation of benefits but what is worse, that or that the drug might have been substituted with junk.
At the moment, I am working on an anti counterfeiting system (for my company) using rfid to track the pedigree of these drugs from manufacturer to end user.
I would have no problem with removal of certain parts of the IP issues and more public access to studies if I knew that somehow the drugs were at least what the companies produced and not some placebo created by a profiteer.
Those are some pretty bold claims, got a source to substantiate them?