Ian Welsh

The horizon is not so far as we can see, but as far as we can imagine

Tag: Pharma

Pharma Charges 80K to cure Hepatitis C. The Manufacturing Cost is $78

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On September 6, 2024

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Yeah.

Unlike many other drugs that treat viruses, Sovaldi does not suppress hepatitis C, a virus that kills roughly 250,000 people around the world each year. It cures it.

“Normally you have a virus, and your body fights it off or your body fights it to a standstill and you just have it forever, basically, and hope it remains dormant more or less,” Laufer said. “The holy grail for every virologist is to find a way to drain the viral reservoir, and Sovaldi does this. You take one pill of Sovaldi a day for 12 weeks and then you don’t have hepatitis C anymore.”

The problem is that those pills are under patent, and they cost $1,000 per pill.

“Literally, if you have $84,000 then hepatitis C is not your problem anymore,” Laufer said. “But given that there are other methodologies for managing hepatitis C that are not curing it and that are cheaper, insurance typically will not cover [Sovaldi]. And so we’ve got this incredible technology and it’s sitting on the shelf except for people who are ridiculously wealthy.”

So Four Thieves Vinegar Collective set out to teach people how to make their own version of Sovaldi. Chemists at the collective thought the DIY version would cost about $300 for the entire course of medication, or about $3.57 per pill. But they were wrong.

“It’s actually just a little under $70 (83 cents per pill), which just kind of blew my mind when they finally showed me the results,” Laufer said. “I was like, can we do the math here again?”

So, the laws should be changed and every pharma exec, board members and so on who prices like this should be locked up for life.

Next, all laws need to be changed to end the doctrine that only profit maximization for shareholders matters.

Third, pharma needs to move a bounty system. According to WHO there are 58 million people with Hep C around the world. Put up a bounty of 1,000 times that: 58 billion, for a cure, minus the cost per cure. Research costs can also be added to the bounty, once the cure is certified, not before. A consortium of rich governments can create the bounty funds, with poorer countries allowed in for free. A UN org reporting only to the general assembly should probably administer it.

Fourth, end pharma patents. All of them. All information, including manufacturing information is shared.

Fifth: for all palliatives, profits must be capped at 5% max.

Sixth: move most research to government and non-profits. Real non-profits, none of the Chat-GPT nonsense.

Seventh: remove further monetary incentives to just research forever: everyone involved is capped at a salary of 2xmedian income in the G-20 or something similar. You want the big pay off? You have to actually cure the disease.

Eighth: Force scientists and technicians to be “in on the bounty.” Some sort of fairly even split between people who worked on the cure.

There are other actions which should be taken, but these are the basics. Right now we aren’t curing people we can, and companies prefer palliatives to cures because they can charge until the person dies. We need to emphasize cures and make sure no one gets rich selling palliatives.

In the meantime the right to make your own medicines needs to be 100% legal and supported.

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The Problem with Pharma Research

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On October 7, 2019

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Capitalism is based on the premise that profits reflect work that people want done, which is also worth more than the costs of its inputs.

The problem with this theory is that it often just isn’t so; the work being done involves a misallocation of resources.

Take pharma, for example. It is more profitable to sell someone a pill a day than to cure them.

This is simply inescapably true in most cases.

A man who needs erection pills, a person who needs insulin, are much better customers than someone who needs a single round of the latest antibiotic.

If you do have an actual cure, since you can’t keep charging forever, you want to charge as much as possible for it. So you raise the price for a Hep C cure (the majority of the research actually having been done with public money) to six figures, when it costs about a $100 to produce.

And a lot of people die or suffer who don’t have to.

The profit motive is a very blunt instrument, and it’s unnecessary for a lot of work. To be sure, no one wants to pick up garbage, but plenty of people want to be medical researchers, because it’s interesting work which does good for humanity, and a lot of people want to do good. Give them a salary sufficient to support their family and a lab, and most of them will be fine with that.

The actual manufacturing is not so fun, but that could easily be done by a range of contracting companies or even by the government.

And in such a situation, suddenly the emphasis is on cures.

If you must have big payouts, make them bounties: “Cure X, and we give you a billion dollars.”

Pharma does do a lot of research, but it wants a pill a day, it wants extensions of already profitable drugs, or it wants hugely pricey cures. It wants to create new forms of addictive drugs, like opiates, rather than just using, oh, morphine and various other forms of painkiller which work perfectly well and already exist and which can’t be patented.

None of this is hard to figure out. There’s a place for private pharma, to be sure, mostly to act as a cost check on public pharma, but as it exists now, what it’s doing is massively misallocating resources.

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Pharma Execs Should Go to Jail and Pharma Should Be Publicly Run

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On June 16, 2019

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*One vial of insulin cost $21 in 1996, compared to $320 in 2018. The cost of Big Pharma’s outrageous greed is American lives. If they will not end their greed, then we will end it for them.* —Bernie Sanders

Corporations are bundles of rights. The most important right is a shield from liability. Corporation rights used to be contentious–in particular, a lot of capitalists thought that it was wrong for corporate officers and owners to not be liable for wrongdoing and debts.

Corporations are given their special rights because it is assumed to be in the best interest of the public. Corporations exist, thus, to make the public better off. When they do not do so, they should be put down. (I would argue corporations have too many rights. Certainly they should not have personhood.)

(I am fundraising to determine how much I’ll write this year. If you value my writing and want more of it, please consider donating.)

So, they’re murderers. Mass murderers. They take actions they will know will kill many people.

The sane response, beyond the simple, “Get them out of the business and have government take over drug research and manufacture,” which would lead to better, cheaper drugs relatively quickly, is to throw them in jail. They kill people in large numbers, and they know they are doing so.

And, in death-penalty states, well, hang them high.

That said, again, it is stupid to run drug research and manufacturing privately. The promotion budgets are larger than the research budgets, and the incentives are all wrong, leading to palliatives rather than cures and insufficient research in important drug classes like antibiotics.

There are things markets do well, but drug research isn’t one of them. (And, in fact, a vast amount of the money still comes from government and flows through universities, but the profits are privatized.)

Lock up the murderous executives, break up their companies, and move the research to public bodies.

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Martin Shkreli Proves that Your Life Is Meaningless to Elites

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On March 14, 2018

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So, a lot of people are happy that Shkreli, the infamous “pharma bro” who raised the price of Daraprim, a 62 year old life saving drug used for serious parasite infections and to treat HIV, by 5,500 percent has been sentenced to jail for seven years.

The catch is that he was sentenced for securities fraud not for jacking up the price of the drug.

Yes, that’s because securities fraud is illegal, but killing people by jacking up drug prices isn’t.

And that’s the point.

Your betters don’t want someone cheating them, but they don’t care if you live or die.

They really, really don’t. Understand that in the core of your being.

There are others who have jacked up the price of life saving drugs. For example, Heather Bresch, the CEO of Mylan, who makes Epi-pens, isn’t in any danger of seeing the penitentiary. Then there are the jacked-up prices for insulin, which, while not quite so dramatic in percentage terms, comes to $400/month in the US, for a drug that the inventor gave away.

People have definitely died, my “favorite” was a guy begging on Twitter for people to fund him or he couldn’t afford his insulin next month.

He’s dead now.

Yeah.

Folks, they don’t care if you live or die. If dead means more money for them, they’re okay with it. This is true in the US, but it’s also true in Britain and increasingly true in the developed world.

If your masters think you’re worth more dead than alive, dead is fine by them.

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Market Failure, Epinephrine Injections, and Societal Failure

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On February 13, 2017

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This is not a competitive market:

Pharmaceutical company Kaléo – already under fire for raising the price of an overdose antidote – now plans to put an alternative to the EpiPen on the market for more than seven times the cost of the leading $608 drug.

Kaléo’s epinephrine injector, used to stop severe allergic reactions, will go on sale for $4,500 for a pack of two beginning on February 14. The auto-injector’s innovative audio instructions walk caregivers through administering less than $5 worth of epinephrine.

Remarkably, because of a system of coupons and discounts, Kaléo’s epinephrine injector Auvi-Q may have the lowest out-of-pocket costs for patients, a strategy some critics say may help some customers, but leads insurance companies to redistribute the cost of the drug through insurance fees to remain profitable.

The materials in such epinephrine injectors are worth about $8.

This is market failure. In a free market without collusion, if something is this high-priced, the price drops to more closely match the cost of production as other producers move into the market. It does not radically increase. As it stands, if you need an epinephrine injector and don’t have one, you stand a good chance of dying.

The rational reaction to these sorts of market failures, increasingly common in pharma, would be: (1) to either restructure the market to prevent them, which would require breaking up big pharma companies, streamlining approval processes, and allowing reverse-engineered knock-offs, or; (2) more simply, for the government to just manufacture them itself and charge a fair price.

There are some government services which should be kept entirely in-house. (The military, for example. Mercenaries are failure mode for any government.) There are many other services for which the government should be one provider among a number. The government stays in the business, providing about a third of the service; because if you aren’t in the business yourself you can’t always know if you’re being rooked by private companies and if you are being rooked, it’s very difficult to do anything about it because you don’t have the expertise to provide the service yourself.

At the same time, you want private companies involved to keep the in-house providers honest. You have multiple contractors, and those who do the best for the least are rewarded, so they have incentives to improve. You swap out the lowest performing ones on a regular basis, especially allowing a few upstarts in at the lowest viable level, so that radical new ideas can be tried.

If those new ideas work, everyone, government and private, adopt them.

At any rate, the market failures in pharma, with price markups in the thousands to tens of thousands of percents, are now so common that it’s clear that a radical solution is needed. The simplest solutions are price control and government getting into the business. Ideally, both should be done at the same time.

Note that price control includes forcing companies to take a profit. Dumping is (theoretically) illegal for a reason. If the government was to get into epinephrine injectors, for example, the logical solution for private enterprise would be to undercut their prices until the government pulled out because, “The private sector is more efficient.” Then, once the government was out of the business, they would jack their prices back up.

So you mandate a healthy profit, and because you’re in the business, you have a decent idea what a healthy profit is, not just for manufacturing, but also for distribution, sales, and so on. “You will make inflation +X percent on this.”

None of this is particularly complicated to do, in theory or in practice, though that isn’t to say that the technical details of setting it up are easy. But pharma is full of scientists and engineers who hate their jobs, and there have been vast waves of lay-offs as well; there’s plenty of expertise lying around.

I should add that this is a solved problem. It is simple to fix. This sort of price-gouging simply wasn’t tolerated in the past, and it is now, and pharma executives know it. Stop tolerating it, and it will go away.

But private pharma is a stupid way to invent and produce drugs anyway. They spend more on advertising than on research, they sponge off publicly-funded research, and they have vast incentives towards palliatives because a pill a day for life is far more profitable than a cure.

Medicines in the public interest, such as new antibiotics, receive little research because they are not profitable, and medicines long out of patent are subject to horrific price-gouging, and so on.

If you’re sick, you’ll pay almost anything for a cure. Medicine, drugs, and medical devices are one of the last things which should be provided through the private sector. If they are, they must be very highly regulated or in an engineered market with careful oversight–one from which the profit motive is largely excised at any level where decisions of patient care are being made.

The fact that our societies can no longer manage something as simple as drug prices is yet another sign of deep social failure.

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Trump Promises to Reduce Drug Prices

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On January 12, 2017

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So, there was a lot of hoopla over Trump’s press conference, most of it concentrating on the release of the oppo research file on him, containing not one proven assertion.

I decided, once again, to read the actual transcript.  And found out that there was little coverage of something which should matter more to most Americans: Trump’s promise to lower Pharma prices.

We’ve got to get our drug industry back. Our drug industry has been disastrous. They’re leaving left and right. They supply our drugs, but they don’t make them here, to a large extent. And the other thing we have to do is create new bidding procedures for the drug industry because they’re getting away with murder.

Pharma has a lot of lobbies and a lot of lobbyists and a lot of power and there’s very little bidding on drugs. We’re the largest buyer of drugs in the world and yet we don’t bid properly and we’re going to start bidding and we’re going to save billions of dollars over a period of time.

The business press seem to be taking this seriously.

It is also, AGAIN, something which should have been tackled long ago. Obama deliberately refused to allow price negotiation with pharma and so did Bush. In both cases, they gave into the lobby. Insane.

Nor, as some say, will this mean that pharma prices will have to rise overseas. Pharma is a profitable industry which spends more on marketing and advertising than on drug research, which researches mostly the wrong drugs, and so on.  They can just make less money–high profits to Pharma are mis-allocated resources.

Next Trump talked about the F-35 (for those who don’t keep track, it basically can’t fly and is vastly over cost.)

And we’re going to do that with a lot of other industries. I’m very much involved with the generals and admirals on the airplane, the F-35, you’ve been reading about it. And it’s way, way behind schedule and many, many billions of dollars over budget. I don’t like that. And the admirals have been fantastic, the generals have been fantastic. I’ve really gotten to know them well. And we’re going to do some big things on the F-35 program…

AGAIN something which should have already been dealt with.

Trump thinks like a deal-maker and a business man, and what he sees is that the government is vastly over-paying for services and products, and he doesn’t like that. And what he sees is that Americans are overpaying as well, because the government refuses to act on their behalf.

I’m sorry, I’m very sorry. Trump will certainly do bad things, but if he follows through on these two things (especially pharma), he’ll be doing very good things that people like Obama would not do.

This is of a piece with Trump killing the Trans Pacific Partnership, while reports have regularly indicated that getting it passed was Obama’s most important legislative priority, likely for his entire Presidency.

Understand clearly that this is the sort of stuff that Trump was elected to do, along with bringing jobs back, curtailing immigration, and so on.

The next thing to watch will be what replaces the ACA (Obamacare). I am not optimistic, because health care accounts are a terrible idea.  But let’s see. (Or, alternatively, call your Congress critters and insist the ACA not be repealed. You might win.)

But right now, as I score it, Trump is more or less on track to do what he said he would do. I think his tax cuts will be disastrous, especially in the long run. I don’t like Obamacare, but I expect him to replace it with something worse. However, in a lot of areas, he’s talking about doing things that should have been done long ago.

When the people too many liberals think are “good” (like Obama), won’t do what everyone knows what must be done, they will eventually be done by people liberals consider “bad,” in ways liberals might not like.

There’s a lesson there.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.

 

 

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