I beg todiffer on the generic R&D. I am in the generic pharma industry in business development and I will tell you thatfor a generic company to come out with a "me too" drug is costly. When you look at the pharmokinetic studies, clinical studies and formulating hours you are in the Millions of dollars. One clinical trial we are working on now is costing nearly $4M and there is no guarantee of success. That does not count the initial deformulation and reformulation work.
Let me further give an example of the generic market and its pricing structure. Say my company is lucky enough to be the first one to market with a generic once the brands patent expires, we have only a very short time to make our money back before (and this is true with one of our drugs) 5 other competitors enter the market, all of who have had similar development costs. We sell to CVS for say $30 a box. Competitor one comes in at a responsible $28. Competitor 3 comes in at $5.00 because theywant market share. All of a sudden the market price drops but this price is only the price to thechain or wholesaler. CVS is still out there selling the product for $100 a box.
You have no idea how many scams the chains and wholesalers have on these drug programs. One chain may ask for 6 months of free goods, others want you to rebate back a set % to them monthly or you do not remain in their preferred contract, I have even seen where they buy in large amounts of inventory to meet their Wall Street numbers only to return the product to the manufacturer almost immediately.
I don't mean to pontificate but I am sick of hearing about the nasty pharma companies driving up prices when the drug wholesalers and chains should be investigated for gouging their customers and suppliers. Tell me why when something is being sold to a chain for $1.00 and then marked up to $50 that the drug companies get the rap?
You only have to prove that your generic is the same as the original. You did not have to bear the cost of research and development, the cost of discovered drugs that failed along the development path, and the cost of proving that the new drug is safe and efficacious. That's why the new drugs get patent protection; otherwise, why look for new drugs?
Good point, and it reinforces the need for consumers' right to use the power of the Internet to shop around. From the consumer's retail point of view, New Zealand happens to offer the best deals right now, but just as with the market for shoes or memory chips, this can change at any moment. We have no business allowing medicine to go on being a trade-protected industry.