Regulate perscription drugs. It's ridiculous how much some drugs cost against other insurance programs (even at my own employer), other countries, etc. I'd wager if we could get a handle of drugs and pharmacuticals we could actually save some $$$$ across the board.

Of course, if you take away the profit motive to invest in the pharmaceutical R&D process, then you'd have to nationalize that industry too.

Privatized pharmaceutical R&D has been a colossal failure. We have ever better viagra, allergen agonists, and fertility drugs because that's where the money is, and the public sector STILL foots the bill for things like H1N1 vaccines and anti-malarials.

I saw this last night, which is probably fairly biased (what isn't), but still interesting: http://www.huffingtonpost.com/greg-palast/obama-on-drugs-98-cheney_b_258209.html

And what did Obama give up in return for $80 billion? Chief drug lobbyist Billy Tauzin crowed that Obama agreed to dump his campaign pledge to bargain down prices for Medicare purchases. Furthermore, Obama's promise that we could buy cheap drugs from Canada simply went pffft!

What did that cost us? The New England Journal of Medicine notes that 13 European nations successfully regulate the price of drugs, reducing the average cost of name-brand prescription medicines by 35% to 55%. Obama gave that up for his 2%.

The Veterans Administration is able to push down the price it pays for patent medicine by 40% through bargaining power. George Bush stopped Medicare from bargaining for similar discounts, an insane ban that Obama said he'd overturn. But, once within Tauzin's hypnotic gaze, Obama agreed to lock in Bush's crazy and costly no-bargaining ban for the next decade.

What else went down in Obama's drug deal? To find out, I called C-SPAN to get a copy of the videotape of the meeting with the drug companies. I was surprised to find they didn't have such a tape despite the President's campaign promise, right there on CNN in January 2008, "These negotiations will be on C-SPAN."

This puzzled me. When Dick Cheney was caught having secret meetings with oil companies to discuss Bush's Energy Bill, we denounced the hugger-muggers as a case of foxes in the henhouse.

Cheney's secret meetings with lobbyists and industry big-shots were creepy and nasty and evil.

But the Obama crew's secret meetings with lobbyists and industry bigshots were, the President assures us, in the public interest.

We know Cheney's secret confabs were shady and corrupt because Cheney scowled out the side of his mouth.

Obama grins in your face.

See the difference?

The difference is 2%.

Then today, I saw a couple of interesting investor moves. Seems that the Gates Foundation has mostly pulled out of pharmaceutical investments (http://online.wsj.com/article/SB125029373754433433.html), while Warren Buffet is increasing investments in that area (http://money.cnn.com/2009/08/14/news/companies/warren_buffett/index.htm). Not usually very smart to bet against Buffet.

Keep in mind Buffet invests more in companies than sectors, I wouldn't read a whole lot more into that than his opinion of those two companies. He still owns a LOT of energy and other pharma.

Right, but if he's investing in pharma, I read that as him not expecting us to be getting any significant deals on prescription drugs anytime soon.

Would there be any logic in subsidizing/tax break/incentive for companies more readily produce generics name brand drugs? i know i save a fortune on generics.

Well generics are kinda a big middle finger to the developers of the drugs. They spend years and millions of dollars developing a drug, finally get one that does something, does FDA trials, and finally makes it to market. They charge the higher prices to pay for all of that. Then when the patent runs out people copy their product for a micro fraction of the cost and sell it en masse. Generic drugs are in part the reason the non-generics cost as much as they do; they need to charge double to recoup costs before their patents run out.

Of course prescription costs are a huge part of the issue. My healthy, physically fit 25 year old girlfriend could never pay for her prescriptions if she didn't have insurance to cover them. My $1000 deductable policy (my do not use unless "oh shit I'm really sick" plan) wouldn't work for her - and she's 25 and healthy. Imagine if she was 65 and needed serious drugs, it would cost a fortune. So what happens is people don't take the drugs as prescribed (taking a pill every other time, or things of that nature, are common) and then they end up in the hospital which gets paid for by everyone else. Again its a case of proactive health care is better than reactive health care. Ditto for mamagrams and colonoscopies and other relatively cheap, easy proceedures that save sooooooo much time and money in the long run.

Then when the patent runs out people copy their product for a micro fraction of the cost and sell it en masse.
That's the intended purpose of the patent system. To encourage more ideas to eventually enter the public domain--benefitting us all--inventors are granted a limited time monopoly on using the idea in exchange for making the idea public.

Of course the duration of patents hasn't kept up with the accelerating pace of technological advances, and the patent office doesn't always do its job of filtering out obvious patents. But that's beside the point.

. Then when the patent runs out people copy their product for a micro fraction of the cost and sell it en masse. Generic drugs are in part the reason the non-generics cost as much as they do; they need to charge double to recoup costs before their patents run out.

You neglected the important part of the patent running out 20 years later as intended. Even assuming years of trials and tests if you can't get 10 good years out of that and turn a profit at monopoly prices, I question what benefit the development really has.

I never stated that it wasn't intended, or a poor practice, or that they were bad in any sense, you inferred that incorrectly. I simply was answering Greystone, explaining why generics are so dramatically cheaper and aren't often available.

Now if only I could find that report showing that most generics are made by the actual companies with the patents through shell companies.

Regulate perscription drugs. It's ridiculous how much some drugs cost against other insurance programs (even at my own employer), other countries, etc. I'd wager if we could get a handle of drugs and pharmacuticals we could actually save some $$$$ across the board.

Ask and you shall receive; at least, they are starting to try and do something about it. $2.3 billion in fines to Pfizer in a fraud case today with the Justice Department and the Department of Health and Human Services, the largest fine ever imposed in the United States. Watching this go down most people can't help but feel the Justice Department really went for blood on this one and really wanted to set an example of Pfizer for all of the drug companies.

http://www.hhs.gov/news/press/2009pres/09/20090902a.html

“This historic settlement will return nearly $1 billion to Medicare, Medicaid, and other government insurance programs, securing their future for the Americans who depend on these programs,” said Kathleen Sebelius, Secretary of Department of Health and Human Services. “The Department of Health and Human Services will continue to seek opportunities to work with its government partners to prosecute fraud wherever we can find it. But we will also look for new ways to prevent fraud before it happens. Health care is too important to let a single dollar go to waste.” ~ Kathleen Sebelius, Secretary of Department of Health and Human Services

Kind of ironic how those opposed to government health care speak of how rife with fraud medicare and medicaid are, yet they overlook the fact that their do no wrong large corporate private sector are the ones defrauding it the most.

Of course, if you take away the profit motive to invest in the pharmaceutical R&D process, then you'd have to nationalize that industry too. The federal government already subsidizes, via NIH, 1/3 of all pharmaceutical research in the US. If you take the time to look at annual reports, you'll see that "big pharma" spends more on marketing drugs than they spend developing them (and this includes clinical trials).

So, would we be better off if Pfizer didn't foot the bill for 8 billion in R&D last year?

Depends on what they were R-ing & D-ing

Pfizer is a pretty scummy outfit. (Nigeria, Neurotonin)

So, would we be better off if Pfizer didn't foot the bill for 8 billion in R&D last year? They're still freeloading off of R&D paid for by the tax payer. And the taxpayers also pay higher prices for the drugs sold in America than for the very same drugs sold in other countries.

And don't forget that Pfizer paid a $2.3 billion fine (http://en.wikipedia.org/wiki/Pfizer#Record_fine_in_2009_fraudulent_promotion_an d_bribery_case) for illegal advertising and bribery last year. Or that Pfizer was involved in coercing New London, CT to use eminent domain laws to take land and property for other people to give to Pfizer.

http://en.wikipedia.org/wiki/Kelo_v._New_London

I contend that Kelo (http://en.wikipedia.org/wiki/Kelo_v._New_London) is our generation's Dredd Scott decision.

None of that answers my question. I don't think they're angels (what company that large is?). It would be easy to point to reams of cases of government corruption and malfeasance too. Does that discredit the NIH and/or any government run health care?

I just don't see the big win in losing the billions they spend on R&D.

People like to joke about Viagra, but Viagra is less than 5% of Pfizer's revenue. They have made plenty of beneficial drugs that improve the quality of people's lives (and their pets). I don't think it's fair to completely demonize them.

I think absolutely the biggest problem is that the incentives are all screwed up. In a Capitalist society, getting the monetary incentives correctly aligned is crucial. We need to make sure that they stand to benefit more from making drugs to cure people, not treat symptoms indefinitely.

I just don't see the big win in losing the billions they spend on R&D.

8 billion a year is pocket change compared to what they overcharge on medication, considering how many crucial chemicals (analgesics, anti-inflammatory, and immune-anti-agonists) are already solved problems; It's also fairly small time compared to the amount of public research that gets sucked up in to the profit machine -- evil commie socialism death-panel Europe remains a bigger spender on research and that's only been getting more clear in the last 10 years (link (http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.5.w969v1)).

You're correct in that we need to get incentives straight. The problem is that the PhRMA is being allowed to set their own incentives here to predictable results. We are paying a lot for sub-standard results, and told to be happy about it.

Here is my major problem with BigPharma. They ultimately have a major conflict of interest. Producing cures is absolutely not in the financial interest of a big pharma company. When was the last time there was a cure produced for a major disease? Polio? What is the current treatment for aids, for cancer, for almost all afflictions? A daily regiment of drug cocktails. Do big pharma companies even work on cures? Do employees who discover cures stay employeed? Do these findings, find themselves in the round file?

8 billion a year is pocket change compared to what they overcharge on medication, considering how many crucial chemicals (analgesics, anti-inflammatory, and immune-anti-agonists) are already solved problems; It's also fairly small time compared to the amount of public research that gets sucked up in to the profit machine -- evil commie socialism death-panel Europe remains a bigger spender on research and that's only been getting more clear in the last 10 years (link (http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.5.w969v1)).

So, if the things we need are already solved problems, what's the harm in letting them develop and sell whatever they want? If they do manage to develop new things that are in enough demand that people will pay premium prices to get them right away, hasn't the system worked as intended?

Let the NIH do the best they can with their ~$30b/yr too, sure, but where's the win in trying to eliminate the other 2/3 of R&D in the private sector?

The harm is that they have de facto taxes levied against you and every other member of the US public to fund their "research but mostly development and marketing" exercise. Given how much you loved Cash for Clunkers, I'm failing to see your devil's advocacy on this one.

That doesn't balance.

I'm not a fan of these synthetic drugs myself, but they obviously improve quality of life for millions of people. So again, how do we benefit from lessening the R&D motive that created those drugs?

Explain why you see Pfizer as a de facto tax on us, if what they're working on are "solved problems" with over the counter or generic alternatives anyway.

If the price of medication the general public pays for, which is higher than every other Western nation, alongside the subsidies provided by the federal government from your tax dollars, is not something you are allowed to negotiate (which in most cases you are not, thanks Medicare D and all kinds of private insurer contracts), don't have a realistic option to not pay, can not source from someone else, etc, then it fits enough qualifications for being another tax.

You could draw parallels to being required to have car insurance or similar legal constructs that create and define private business models. Car insurance is probably a good point of comparison for the incentives being closer to good; car insurers compete on price and value. Drug companies compete on lobbying acumen.

If the price of medication the general public pays for, which is higher than every other Western nation, alongside the subsidies provided by the federal government from your tax dollars, is not something you are allowed to negotiate (which in most cases you are not, thanks Medicare D and all kinds of private insurer contracts), don't have a realistic option to not pay, can not source from someone else, etc, then it fits enough qualifications for being another tax.

We generally pay more for everything here, not just health-related products, sure. That's no revelation.

Is it reasonable to pin that on drug makers? Do you blame German Bayer and American Pfizer equally?

We generally pay more for everything here, not just health-related products, sure. That's no revelation.

Is it reasonable to pin that on drug makers? Do you blame German Bayer and American Pfizer equally?

I know compared to most European countries, we pay less for food, less for gas, less for electricity, less for clothing, and less for housing.

You have the bad fortune of picking Pfizer as the example to hold up. This is one of the most evil corporations on the planet.. seriously.. they are fucking scumbags.

Case 1. Recently Pfizer was fined 2.3 BILLION dollars for forcing its reps to push doctors to use Geodeon (an anti-psychotic) on children and other off label uses. They were doing this with a few other of their drugs, trying to convince doctors to use it for things it hadnt been approved of, in order to boost sales.

Case 2. In 1997 Pfizer decided to use a meningitis epidemic in Nigeria to test its new drug Trovan. They didnt tell the children they were doing experimental drug tests. Of the 100 testees... 11 died of acute liver failure. Later in 1999, the FDA pulled Trovan from the shelves because it was causing...... acute liver failure.

Case 3. Blocking of AIDS drugs. Pfizer makes several AIDS inhibitors that they have refused to allow patents for generics in poor countries. The pills cost about $20/day and pfizer has refused to lower the prices for people in countries where the average wage is $120/year.

Case 4. Neurontin. Another example of off-label uses gone wild. This is a very powerful pyschotic drug... originally marketed and moved through the FDA process as an epilepsy drug.. However... 90% of Neurontin (Gabapentin) sales are off label... its commonly used, because of aggressive pushing, as a pain reliever and an alternative to lithium. Additionally information is coming out from Brown U that Pfizer has been using intentionally faulty research practices in order to produce desired results and make claims that boost sales.

They are fucking scum. They embody everything that is wrong with the system.

But hey.. Cialis!! AMIRITE?!?!?

Tuskegee, Agent Orange, Gulf War Syndrome, oh my! IBM gave the Nazis computers too. I guess we'd better burn the whole thing down!

I fail to see the relevance of any of that though. Where do you see me holding Pfizer (or any of them) up to be philanthropists or perfect angels?

No, not angels, but lets also not say that altering what Pfizer is doing and changing the status quo is not a good thing.

Big Pharma does some good, and does alot of bad too. This isnt some national treasure to be preserved. It needs an overhaul and people need to start asking the very serious question "Is health for profit a good idea."

At the very least... Big Pharma and the Insurance Industry need heavy, heavy regulation. Not just in products, but in business practices.

Or, someone should become the change that they desire. If this R&D is so easy and so important, why isn't a billionaire like Soros out there funding development of cheaper alternatives to put evil Pfizer right out of business?

Isn't that how competition is supposed to work?

When it comes to actually getting outside of government and getting anything done, a lot of these Democrats today seem like the business equivalent of the military chicken-hawks in the last administration.

It's easy to blame big, mean Pfizer and throw stones, but there's a lot of middle ground that doesn't involve continually increasing the size and intrusiveness of government. We're just getting to the point that we assume the nanny state is going to take care of every little thing, and we're not even bothering to try innovating.

I don't think its that as much as Capitalism has veered awry. Profit for profits sake has become a moral good. It isn't. Self Interest has been placed in a position where it causing harm to the public interest.

Competition and free marketeerism is not a cure all and it isn't good in all cases. Health is probably one of those areas where it needs to be tempered and balanced to achieve the right mix for what is best for society and the public interest.

I don't pretend to have an answer or a system in mind to achieve this... but I can state an example from the top of my head that sort of illustrates what I see as the best for all parties.

The government declares the goal of finding a cure for cancer in 15 years. It opens up a NASA for Cancer, so to speak. It heavily funds this and brings in the best minds from around the world to work with each other. It additionally funds this by telling the Phara companies that every dollar they spend on research and development not directly related the ultimate goal of finding a cure or maybe AIDS or whatever else we list as directly related to the public good, must be matched and given to the Government program. Im not necessarily advocating this, as much as I am the principles behind it.

We all have a responsibility to society. Even corporations. Profit alone is not enough of a reason to exist.

Or, someone should become the change that they desire. If this R&D is so easy and so important, why isn't a billionaire like Soros out there funding development of cheaper alternatives to put evil Pfizer right out of business?

Isn't that how competition is supposed to work?




I will admit my ignorance from the outset, so you won't need to do your usual needling.

My question (in ignorance) is whether it is possible for someone like a Soros to simply set up a competing company in the drug business? Haven't they put laws and regulatory restrictions on access to the materials necessary for most of the R&D involved in pharmacological research? Is it really possible any longer for someone of means to simply decide to funnel their monies into finding cures with a wholly owned company, or would they be forced (or steered via regulations) to instead invest their monies with one of the few super-Pharm companies?

I would assume those lobbying groups are working just as hard to preserve the status quo and flow of monies as they are to get their drugs on the market, regardless of whether they have been thoroughly vetted as safe for the public.

I'm sure there's substantial lobby influence around at least the approval process, but if German Bayer can navigate it, I'm sure someone with deep pockets could just as well. Worst case, a Soros or Gates could pump billions into targeted grants instead of trying to start from scratch themselves (or becoming involved with big-pharma).

I don't think its that as much as Capitalism has veered awry. Profit for profits sake has become a moral good. It isn't. Self Interest has been placed in a position where it causing harm to the public interest.

Competition and free marketeerism is not a cure all and it isn't good in all cases. Health is probably one of those areas where it needs to be tempered and balanced to achieve the right mix for what is best for society and the public interest.

I don't pretend to have an answer or a system in mind to achieve this... but I can state an example from the top of my head that sort of illustrates what I see as the best for all parties.

The government declares the goal of finding a cure for cancer in 15 years. It opens up a NASA for Cancer, so to speak. It heavily funds this and brings in the best minds from around the world to work with each other. It additionally funds this by telling the Phara companies that every dollar they spend on research and development not directly related the ultimate goal of finding a cure or maybe AIDS or whatever else we list as directly related to the public good, must be matched and given to the Government program. Im not necessarily advocating this, as much as I am the principles behind it.

We all have a responsibility to society. Even corporations. Profit alone is not enough of a reason to exist.

It might not be a good model for long-term, sustainability, but a Manhattan Project to cure type-2 diabetes or something widespread like that would probably be a good idea regardless.

I don't think Capitalism has to fail us here though. It just hasn't been done right yet.

For example, imagine someone developed a single shot pill to cure type-2 diabetes. They could sell those pills for $10,000 a pop and insurance companies would line up to pay it; a bargain compared to treating endless complications.

That company would make more in its first year than Pfizer made in the last decade. Next thing you know, companies are racing to find those sorts of cures first and cash in. It could be great for everyone.

There's nothing wrong with profiting from a job well done. Profit has long driven innovation that results in benefit to the public good. Profit is the only reason the Chinese buy our bonds and pay to fund all these programs Obama wants to enact. Profit is what will be used to pay the tax revenues that eventually (hopefully) pay those bonds back.

We should be very careful about the government attacking private companies for profiting. The short-term, superficial benefits might seem worth bending the basic tenets of our society a little, but the long-term consequences could be dire.

For example, imagine someone developed a single shot pill to cure type-2 diabetes. They could sell those pills for $10,000 a pop and insurance companies would line up to pay it; a bargain compared to treating endless complications.

That company would make more in its first year than Pfizer made in the last decade. Next thing you know, companies are racing to find those sorts of cures first and cash in. It could be great for everyone. No. And for historical proof that it would never happen, one only need look to ulcers. It only takes a single course of antibiotics to cure the infection that causes ulcers, however pharmaceutical companies sold prescription drugs to mask the symptoms for decades. $100/month for the rest of your life for Zantac, or Prilosec or other prescription drugs - just to cover up the symptoms of what takes $10 of antibiotics to cure. And it took more than 20 years for the medical evidence to get published and attention paid to it.

Yes. You're only thinking in terms of an existing player, like Pfizer, coming up with the cure. I'm talking about outside competition, without that internal conflict of interest.

Ulcers are a bad example anyway. You should be blaming doctors for flubbing that one just as much as the pharmaceuticals. Since the cure already existed, there was no profit motive. Not really comparable to what I was talking about.

Cynicism is easy. What's your suggestion?

You're getting to the point of defining the problem outside of the discussion to continue on the devil's advocacy here. If the goal is profit for a few individuals, the current model works great. If, instead, the goal is actually getting worthwhile medications, it barely works at all. This is a policy question well outside the semantic quibbling and endless digressions of exactly how the PhRMA crew roll; they're doing a fantastic job, but it's not anything remotely like the job we're paying them (a lot) to do.