[Ip-health] NY Times editorial: No Justification for High Drug Prices

Ruth Lopert ruth.lopert at gmail.com
Tue Dec 22 07:42:08 PST 2015


But they are not.

On Sun, Dec 20, 2015 at 11:07 AM, Peter Pitts <ppitts at cmpi.org> wrote:

> They can be defined in many ways, another is to compare the actual price
> paid to similar prices paid in other western nations. That is a more
> accurate comparison that matches up with national healthcare expenditures
> on pharmaceuticals. This is why pharmaceutical expenses across western
> nations are more or less the same.
>
>
> On Dec 20, 2015, at 10:58 AM, Peter Maybarduk wrote:
>
> > On the other hand those are "discounts"  off prices the companies
> themselves set, often in a competition-free environment, having gamed out
> the prices they will offer various payers in advance. They aren't discounts
> so much as they are simply varying prices in a profit maximization strategy.
> >
> > -----Original Message-----
> > From: Peter Pitts [mailto:ppitts at cmpi.org]
> > Sent: Sunday, December 20, 2015 9:25 PM
> > To: ip-health
> > Cc: Peter Maybarduk
> > Subject: Re: [Ip-health] NY Times editorial: No Justification for High
> Drug Prices
> >
> > The editorial "No Justification for High Drug Prices" (NYT, 12/20/15)
> quotes the "list" price for  innovative medicines from Eli Lilly (Portazza
> for lung cancer)) and Pfizer (Ibrance for advanced breast cancer). The
> prices mentioned are true, but the context is inaccurate. Most every
> innovative new medicine offers significant discounts to private insurance
> payers (generally between 35-50%) in addition to double digit rebates for
> Medicare and Medicaid. There are very few patient paying "list price" and
> for those without insurance both of these companies (and mostly all
> innovative pharmaceutical developers) offer programs that provide their
> products at low or no cost. Context matter and accuracy counts.
> >
> > Peter J. Pitts, a former FDA Associate Commissioner, is President of the
> Center for Medicine in the Public Interest On Dec 20, 2015, at 9:36 AM,
> Peter Maybarduk wrote:
> >
> >> http://www.nytimes.com/2015/12/20/opinion/sunday/no-justification-for-
> >> high-drug-prices.html?action=click&pgtype=Homepage&clickSource=story-h
> >> eading&module=opinion-c-col-left-region&region=opinion-c-col-left-regi
> >> on&WT.nav=opinion-c-col-left-region&_r=0
> >>
> >> By the Editorial Board / Dec. 19
> >>
> >> There is ample evidence that drug prices have been pushed to
> astronomical heights for no reason other than the desire of drug makers to
> maximize profits. Prices in many cases far exceed what's needed to cover
> the costs of research and clinical trials, and some companies have found
> ways to rake in profits even without shouldering the cost of drug
> development.
> >>
> >> The two worst offenders are bottom feeders that simply buy companies
> they believe have underpriced their drugs and then quickly raise prices to
> astronomical levels.
> >>
> >> In August, Turing Pharmaceuticals acquired the American marketing
> >> rights to a 62-year-old drug to treat a devastating parasitic infection
> andraised the cost of one pill to $750 from $13.50. That brought the cost
> of a course of treatment for some patients to hundreds of thousands of
> dollars. (Turing's founder, Martin Shkreli, was indicted on Thursday on
> charges of securities fraud involving a hedge fund and another
> biotechnology firm he started.) Valeant Pharmaceuticals greatly increased
> the prices of several drugs it acquired, including two used by hospitals to
> treat heart conditions. It also protected its high-priced dermatology drugs
> by urging doctors to send prescriptions to a mail-order pharmacy that would
> make sure no cheaper alternative was substituted.
> >>
> >> The Pharmaceutical Research and Manufacturers of America, a trade
> group, described Turing and Valeant as essentially investment vehicles
> "masquerading as pharmaceutical companies."
> >>
> >> Yet even some mainstream companies have set high prices that seem hard
> to justify. Eli Lilly said its new lung cancer drug, Portrazza, would cost
> about $11,430 a month in the United States, six times the $1,870 price that
> leading oncologists said in a recent journal article would be a fair
> reflection of the benefit the drug offers compared with older therapies.
> >>
> >> Similarly, Pfizer set the list price for Ibrance, a drug to treat a
> form of advanced breast cancer, at $9,850 a month, a price that remains
> high even after the 20 percent discount demanded by insurers. The price was
> not based on manufacturing costs or research costs, according to an
> analysis by The Wall Street Journal. Rather, Pfizer set the price as high
> as it could without causing doctors and insurers to favor an alternative
> drug.
> >>
> >> The pharmaceutical industry often defends its prices by noting that
> drugs account for only 10 percent of nationwide health spending. But in
> employer-based health insurance plans, drug benefits account for 19 percent
> of spending, not much less than spending on inpatient hospital care,
> according to a recent analysis by the Kaiser Family Foundation. And surveys
> have shown that many Americans have difficulty paying for the drugs they
> need. Major drug companies often increase prices 10 percent or more a year,
> far faster than inflation, straining the health care system.
> >>
> >> Experts have proposed several ways to reduce drug prices, like
> fostering greater competition among drug companies or allowing the
> government to negotiate lower prices. Encouraging the development of
> innovative drugs and setting prices in ways that make lifesaving medicines
> affordable to all are not mutually exclusive ideas.
> >>
> >>
> >>
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