Sunday, 24 August 2014

Politics: drug pricing

Do Pharma CEOs' deserve their large bonuses? #MSBlog #MSResearch

"Do MS DMTs justify their current premium? A large number of MS drugs are repurposed and hence their risk of failure has been low. Despite this the costs remain high."

"Re-purposed licensed MS drugs include mitoxantrone (Novantrone), teriflunomide (Aubagio), dimethyl fumarate (Tecfidera) and alemtuzumab (Lemtrada). In addition, many drugs in late stage development are also repurposed, i.e. daclizumab and ocrelizumab. The article below discusses the issues around high-cost drugs. Pharma say they need to charge a lot to make the necessary profits to feedback into their R&D programmes to drive new cycles of innovation. They also argue that their drugs will eventually come off patent and the prices will fall and the population will then get cheap versions. In other words we pay a premium now so that future generations get cheap drugs."

"Regarding this issue I am not sure of what is the correct answer, except to say that Pharma will charge as much as the market will support. This means we need systems in place to keep the prices reasonable, which is what EU organisations such as NICE do. However,  this does not occur in the US and hence the costs of drugs in the US is much higher than outside of the US. This means that the US is subsiding drug prices, and drug development, for the rest of the world. The latter cannot go on indefinitely. What is a problem is when the new drugs are truly transformational and without them people with certain disease will die. This issue has recently been raised with the pricing of the new hepatitis C drugs and I have addressed this on the blog quite recently. Similarly, should Pharma bosses get paid so much? For example John Martin, the CEO of Gilead who make the new hepatitis C drug, received $90 million in 2012. Economists would argue that if you believe in the power of the market to deliver then you should let it work its magic; if you try and prevent the market working it won't deliver on what is needed. I am not sure if buying and prescribing of drugs is a real market; sick people don't have a choice when it comes to certain treatments. What do you think? Is the prescription drug market a real market?"

"Please read my previous post on the politics of high drug pricing."

Barlas S. Are specialty drug prices destroying insurers and hurting consumers?: a number of efforts are under way to reduce price pressure.P T. 2014 Aug;39(8):563-6

Organizations are trying to address the high cost of "specialty" medications that treat conditions such as cancer, hepatitis C, and multiple sclerosis. While comprising less than 1% of U.S. prescriptions, these drugs now account for 27% of pharmacy spending.


  1. Hey, how is 90 mln into the pocket of the CEO going to improve future development and innovation in medicine ? :-)
    Pharma is sick. New drugs are priced at a level that only governments can pay, no patient could possibly afford years of MS drugs as an "out of pocket" expense ( unless thay are a pharma CEO, that is...)

  2. Didnt you say NICE was the reason for Pharma leaving the UK?

  3. This is codswallop. The main funding for research is still primarily subsidised by Parliament. Parliament funds British universities. Government pays Prof G and MouseDoc's salaries. Big Pharma steps in when potential breakthroughs are made.

  4. Yesterday's headlines were MS sufferers in England can't get Sativex on NHS prescription. It's free for patients in Wales. My Welsh friend suffering from Cancer has to travel to England for his treatment. We can't have it all.


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