Half the cost of roll-out of a new drug is marketing. Mostly now, that’s direct-to-patient, mumble the side effect profile and “ask your doctor if Mitekillya™ (mitemakeyasik) is for you” ads. Yet, the cost of a new drug roll-out’s so huge, Big Pharma says it’s tough to justify those costs if they’re not allowed to drum up as much business as possible.
Legitimate R&D costs in Big Pharma are huge (20 years ago, when I worked actively in the business, the estimate was US$300,000/day for human safety and efficacy trials, and the late-phase trials can take eighteen months). Pressure’s huge on company chemists and pharmacologists to invent new molecules which can be sold as treatments for disease. And Big Law has made recovery of obscene awards in side-effect court cases a big upward driver of health-care costs nationwide.
I can think of a positive change to your formula that addresses this — make part of the written-in allowable recovery of costs for Big Pharma payments into a fund for new drug development in drug targets that aren’t so apt to make huge profits, another fund to pay out actual damages for adverse drug side effects (not every company’s going to be as lucky as Pfizer and test a new drug that gives its older male patients erections, after all).
Then abolish both huge drug lawsuits and direct-to-patient or non-educational marketing of any drug sold in the US. Restrict “marketing” of new drugs to the little white sheets of paper the doctors ought to be reading before they prescribe anything, and make sure that drug salesmen don’t show up with football tickets or Friday lunch for the whole clinic staff to make sure docs remember to write lots of scrips for their expensive new drugs. No more ads for drugs directly (on TV or the Internet) to patients who can’t make truly informed decisions on which drugs to ask their physicians for.
I noticed that FDA refused Israel’s Teva Pharmaceuticals permission to market a generic EpiPen here, and wondered “Why?”. Israel, as a major potential target for nerve agent attacks, knows how to make an EpiPen-like device, for that’s the only way to get a nerve agent antidote into someone quickly. Our own Homeland Security and Defense departments probably have spent a billion dollars between them buying such gadgets filled with atropine, pralidoxime and diazepam, some of them probably from Teva.
But FDA won’t allow Mylan to be hurt where it counts, by pure market competition, for jacking up the price on a dead simple life-saving device from its cost of production of a dollar or two to over $500. Again, why not? One suspects the drones at FDA who made that decision are looking forward to a lucrative post-government career at Mylan. (Another general prohibition should be Federal employees of any kind leaving Federal employ to work where their decisions made their new employers millions or billions — not just in Big Pharma, but aerospace and defense contracting.)
FDA ought actually to be soliciting generic drug makers here and overseas to produce well-understood, long-ago amortized drugs and medical devices at low cost to undercut Mylan’s EpiPen move and Turing Pharmaceuticals’ Daraprim price hike.
Instead of ObamaCare’s counter-intuitive six new taxes on the chain of provision of health care, which have reduced health care availability to the working lower and middle-class (predictably to anyone who didn’t pass sophomore macroeconomics by giving sexual favors to the instructor), Federal regulations ought to be aimed at removing the weird bottlenecks in the health care economy like Mylan and Turing’s obscene profiteering which allow some Big Pharma companies to feather their nests by milking Part D of Medicare and private healthcare insurance unjustifiably.