Posted on 09/21/2015 10:49:41 AM PDT by Citizen Zed
The major biotech ETF fell to its lows of the day after Democratic presidential hopeful Hillary Clinton said Monday she would take on "price gouging" in the pharmaceutical industry.
A Sunday New York Times article told of a specialty drug that went from $13.50 to $750 per tablet overnight. Responding on Twitter to this piece, Clinton said Monday she will propose a fix to the situation on Tuesday.
The iShares Nasdaq Biotechnology ETF (IBB) was trading down more than 4 percent by early afternoon, taking a visible leg down around the time of the 10:56 a.m. ET tweet by the presidential candidate.
(Excerpt) Read more at cnbc.com ...
At least somebody’s talking about it.
But there is a very important flip side to that. Something like 9 out of 10 new drug trials end in expensive failures. Take away the profit motive and soon there's no more new drugs, period.
No, in those cases foreign governments are putting a gun to the heads of US pharaceutical companies and saying that if they don't give those countries a really good deal on their drugs, they will invalidate their patents in those countries and let generic manufacturers make cheap copies of drugs that cost billions of dollars to develop.
What I find objectionable is that manufacturers of drugs that are no longer patent protected greatly increasing the prices of those drugs years after patents have run out.
the end result of obama selling out to big pharma for their support of obamacare (from the left wing nation):
“A Rancid Deal with Big Pharma
Did Obama sell out? If House Democrats don’t insist on the government’s prerogative to bargain for lower prices, reform is impossible. “
http://www.thenation.com/article/rancid-deal-big-pharma/
So with a news piece coordinated directly with Hillarity’s campaign, they set her up with (a) a question she actually answers; (b) something that they think will resonant with the public; and (c) something that isn’t about Muslims.
Also: big shock that she’ll have a ‘solution’ out tomorrow.
I see Januvia online for about the same price as you can buy it in other countries.
Geez.
Pretty soon we will be hearing Go Hillary Go's around here.
“Something like 9 out of 10 new drug trials end in expensive failures. Take away the profit motive and soon there’s no more new drugs, period. “
The cost of these drugs is driven by regulation, not drug related costs. Suppose you run a drug testing firm. You give a substantial donation to a connected politician and he writes a law requiring that your patented test be used on all drugs. You can now charge whatever you want even if your test does nothing to verify anything about the drug. That’s just one example.
Many foreign drugs never come to the US because the cost of getting certified “safe” far exceeds any money they’d make. Drugs to treat rare diseases exist but nobody will pay to have them certified.
Government is screwing us far more than they are keeping us safe. It’s government and crony capitalists who rake in the money. Drug companies run a distant third.
What about those little blue pills - no patent protection in Europe now, And the price there is ...
You're correct, because those countries threaten to ignore the patents if pharma doesn't give them the price they want. It's essentially extortion, and it exists in part because the US doesn't enforce its own patents with these countries. The proper response should be (IMHO), ‘if you ignore our patents, we will ignore yours, and we will nail you with taxes on any of your exports that wind up here’.
I have been in small molecule pharma and bio-pharma for 37 years, both in generic and proprietary product development.
It costs us 100’s of millions of dollars for product development before going into clinical trials. Those trials also cost millions.
Just bringing a product to first in human testing is incredibly difficult and takes years of $$$.
After clinical approvals, then there is the process development for the actual large scale manufacturing, new equipment, qualifications of the mixing, filling and stability programs...etc.
It costs big $$$ to bring these life saving drugs to market, comply with US and GLOBAL regulatory testing requirements and the maintenance of the product over time.
The real costs of healthcare are caused more by the regulations we have to comply with than the actual cost of the active pharmaceutical ingredients too.
G
From 2005 to 2007 in the run up to the crowning of obamaumao, the Big Pharma fired literally 10s of thousands of employees, in the US and worldwide. Reason: to eliminate the expense of salaries and convert those BILLIONS to the lobbying effort that became Affordable (not) Care Act.
Pharma WANTED the ACA, in exchange for “no harm” and no interference in their pricing. The goal of the largest companies is to be the vendors of 1st resort. Prime Vendor status. And their ability to name their price. People do not get this.. at all. Pharma and big insurance, both being idiots as the “worm now turns” to the real agenda of obamaumao— single payer (Canadian and UK national health nightmare that Lord Monckton warned us about constantly— a bankrupt system to begin with). Coupled with the illegal alien push by the socialist/marxist in chief, the Cloward-Piven aspect of unsupportable “free” healthcare, means more than single payer. It means the destruction of the finest healthcare in the World (Ask every dictator where they want to be treated— in the US).
The whole topic is a sore subject, industry wide, and personally. Know quite a lot about it. For reference check the PhRMA lobby group and the former democrat coverted Louisiana repub who ran PhRMA through this time period to get ACA passed— Billy Tauzin. Oh, and Pfizers jewish leftie friend of obamaumao, the CEO of Pfizer at the time, one Mr. Kindler. A crook who has been “retired” forcefully.
There will be people in every country who have bad reactions to pharmaceuticals, but US courts pay the highest settlements - surely a big cost to doing business here
Actually, this does happen (or has), and it’s really convoluted.
From the link below:
“Drugs cost less in countries like Canada than in the United States because international laws on commerce treat prescription drugs differently from other consumer products. U.S. pharmaceutical companies are required under a 1994 treaty to sell their drugs at drastically cut prices to countries with drug price controls. Any pharmaceutical company that fails to comply can be punished by having its patent protection taken away.
To comply with this treaty, drug companies slash prices for countries with price controls — most countries in the developed world. The purchasing countries in this deal are supposed to agree not to turn around and resell the drugs to Americans.”
http://acsh.org/2005/08/drug-importation-threatens-pharmaceutical-innovation/
This is a bit old, but I’m not aware of any dramatic policy shifts away from this. If someone has more recent info, I’m happy to be corrected.
Through preclinical and clinical trials into final approval the cost seems to average about 800 million dollars and the timeline to fruition is lengthy. The vast majority of drugs never make it to market (about one in five compounds that make it to Phase 1) and the financial drain on a company to develop it's pipeline is enormous. So the question is, if we start price mandating in the US like Canada does, who is going to capitalize the engine that produces new drugs?
The reality is that the US market is the single largest profit source for global pharma and a great deal of funding for bio-techs is private sector investment. Investing in these companies is a high risk undertaking and if the products that are born out will never produce significant revenue why the heck would I throw money at it?
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