Read on Twitter
As you can see here, even if a pharmaceutical company is run by people who are acting truly altruistically and without any profit motive (beyond the basic financial needs to stay operational), all roads lead to high sticker prices for drugs.
There are countless forces acting on drug prices in the US, and *all* of them act to increase the sticker prices. Even for a purely altruistic company, there are no incentives to lower sticker prices for drugs in the US.
And of course, pharmaceutical companies are not altruistic. They're perfectly willing to let people die if it helps their bottom line. So if even an altruistic pharma co. would be forced to have high drug prices, it's no surprise that a ruthless, profit-seeking company would too.
I only mentioned it briefly, but you'll notice that the example of the Swiss market (a small market with incredibly aggressive price controls) only functioned because the pharma company was able to make up the difference from a larger and more lucrative market.
That's not an accident - most European countries that have enacted aggressive price controls on drugs are only able to do so because of the globalized OECD market - and specifically, because of the US market.
If the US didn't exist, European drug prices would be much higher.
If the US didn't exist, European drug prices would be much higher.
It's tempting to say that Switzerland (in this example) would have leverage because they're gatekeeping a market of 8.5 million people, but for essential medicines, the pharamaceutical company has the leverage of being able to walk away, leaving patients blaming the politicians.
This doesn't mean that the US can't enact price controls on pharmaceutical drugs, but it does mean that it's nonsensical to use European drug prices as a baseline for what the US could expect to pay - those prices are already subsidized by the US!
And remember, about half of the top pharmaceutical companies in the world are based in Europe, so from a profit perspective, Europe is essentially double-dipping: lower drug prices for Europeans, subsidized by US patients, with fat profits for European companies in the process.
We're talking about pharmaceutical pricing here, but this general flow-of-funds is also why you can't use Medicare's budget as a reference point for a hypothetical single-payer system in the US.
Medicare's budget is explicitly subsidized by private insurance, by law.
Medicare's budget is explicitly subsidized by private insurance, by law.
That doesn't mean you can't argue in favor of single-payer healthcare in the US, but it *does* mean that you need to have a more sophisticated analysis and plan, beyond simply pointing to Medicare and assuming that those subsidies will exist even after private insurers are gone.
Okay, back to pharmaceutical pricing: even if the sticker prices are meaningless, because pharma companies make much higher per-capita revenue in the US, that still means that US patients are paying more at the end of the day, which is bad.
How do we fix it?
How do we fix it?
One easy solution is to allow prescription drug imports from other OECD countries. How would this lower prices?
Let's say Gilead manufactures a drug in the US. They sell that drug in the US for a hefty price, but they also export that drug to Canada/Europe/etc. where they sell it at a lower price.
It's the exact same drug, made at the exact same factory. Why two different prices?
It's the exact same drug, made at the exact same factory. Why two different prices?
The only reason that Gilead *can* charge a higher price in the US while charging lower prices elsewhere is because US pharmacies are not allowed to reimport drugs.
If they could, then they could use the cheapest source for the drug.
If they could, then they could use the cheapest source for the drug.
Again, we have no issues of provenance or manufacturing here, because we're talking about brand-name drugs that are already manufactured in the US by the same company at the same plant. They may even have the same packaging!
Only difference is the shipping label on the box.
Only difference is the shipping label on the box.
If this were allowed, and Gilead tried to charge $3000 in the US but $200 in another country, your local US pharmacist could tell Gilead "thanks bro, but I'm going to place an order from our European warehouse instead, and then just mail that back here".
In reality, few shipments of drugs would actually need to make two transatlantic trips like this. But the fact that it's an *option* means that Gilead can't really charge (much) more for a direct shipment than it *would* cost do the reimport.
Sometimes, the mere threat suffices!
Sometimes, the mere threat suffices!
Are there any efforts to pass a law allowing us to reduce pharmaceutical prices by allowing prescription reimports?
Funny you should ask...
Funny you should ask...
In 2017, Senators Sanders and Klobuchar introduced Amendment 178, which would have lowered drug prices by permitting reimports.
It failed by 5 votes, with 13 Democrats opposing it.
It failed by 5 votes, with 13 Democrats opposing it.
Democrats who blocked the 2017 bill to lower prescription drug prices by allowing drug imports include:
* Bennett (Colorado)
* Booker (New Jersey)
* Cantwell (Washington)
* Casey (Pennsylvania)
* Feinstein (California)
* Menendez (New Jersey)
* Murray (Washington)
* Bennett (Colorado)
* Booker (New Jersey)
* Cantwell (Washington)
* Casey (Pennsylvania)
* Feinstein (California)
* Menendez (New Jersey)
* Murray (Washington)
now that you understand why sticker prices for drugs are high in the US (and how the US subsidizes low drug prices abroad) watch this exchange between @AOC and the CEO of Gilead from last year https://twitter.com/Public_Citizen/status/1277982392192360450?s=19
Truvada is a particularly weird case because it's currently generic abroad and not in the US, but even before that there was a massive price difference, and the US government paid for the development of PrEP (which is being used worldwide, and which Gilead is profiting from)
In the case of PrEP, I have no problem with the US government (taxpayers) funding a lifesaving discovery that could end the HIV/AIDS pandemic globally, without international funding.
But that's not what's happening - a private company is profiting off that taxpayer research, despite doing essentially nothing to contribute to that discovery.
The case is even more clear for remdesivir. Gilead had abandoned remdesivir, and it's only because taxpayer funds developed the drug that it exists today!
It's hard to make a coherent argument that Gilead deserves the right to profit off its use for COVID-19 treatment.
It's hard to make a coherent argument that Gilead deserves the right to profit off its use for COVID-19 treatment.
If you find some junk while digging through a dumpster, and then use that junk to make a lifesaving medicine, the person who threw away the junk can't claim they own the medicine you invented.
So why should Gilead pretend they own remdesivir?
So why should Gilead pretend they own remdesivir?
Here @PrEP4AllNow makes a clear case that the federal government is an owner of the key patents on remdesivir, which would mean Gilead has no authority to prevent the federal government from authorizing generic versions of remdesivir at a low cost. https://www.prep4all.org/news/remdesivir
Not only is that *not* a far-fetched claim, but the Patent Trial and Appeals Board just upheld an analogous case *also* involving Gilead, affirming that the federal government does have legitimate claim to these drug patents: https://www.statnews.com/pharmalot/2020/02/05/gilead-hiv-patents-truvada-cdc/
