Monday Links

Posted on by John C. Goodman

Oregon hospital threatens to refuse Medicare Advantage patients.

Ten drugs, mostly used to treat rare diseases cost over $700,000 annually.

How Big Pharma makes its money: AbbVie blanketed Humira, the best-selling drug in history, with 165 peripheral patents, to deter any possible competition.

Medicine without doctors:  The past several years have seen hundreds of laws proposing to expand non doctor medical professionals’ work, the AMA has spent millions of dollars fighting back. (Washington Post)

7 thoughts on “Monday Links”

  1. Thanks for posting the article on rare drugs. Two points come to mind:

    1. The article quotes the sticker price of each drug, not the price after rebates. And probably not the price that insurers actually pay, which may be confidential.

    2. At whatever prices, the American drug market is in some ways a pretty strange place.

    Drug companies conduct serious, expensive research on how to treat conditions that appear
    in perhaps 1 new born in 4 million, ratios like that.

    If a single payer system decided that this was a poor spend of public funds, I would not be among the protestors.

    Reply

  2. “1 new born in 4 million”

    Bob do you have data to support that ratio? Approximately?

    In general, R&D for new medications has always seemed to me more like a lottery than a market. Trying to win that lottery by reducing the number of tickets bought, does not seem to me a practical strategy. And even less practical in the case of orphan drugs. Unless by some stroke of biological insight, ways are found to make at least some orphan drugs inexpensively, and widely affordable. Which can never happen if scientists aren’t looking.

    It’s a very difficult problem. In the absence of competition, the more practical strategy would be to pare back research on orphan drugs. The absence of competition, even resistance to it, is a thing in the public sector. My opinion – that became noticeable in the government’s behavior during the Covid years. On the other hand big pharma is often anti-competitive itself, and a chart showing pharma mergers over the past 20 years or so looks like an NCAA bracket. Still, if there remains only a small advantage for private sector control of pharma R&D over government control, I guess I favor private sector control by that small difference. Then the question becomes – How can the public ever know?

    Anyway, do you have data on orphan drug R&D?

    Reply

  3. Thanks for comments, John.

    The incredible rarity that I cited for these diseases come right out of the article. Brineva treats a condition that appears 20 times a year. Zokivny treats a condition that has appeared 130 times since 1886.

    I know that scientists do spend years studying such incredibly rare events. It’s not something I could do, but no harm done in most cases.

    I am not troubled if a foundation or a university wants to sponsor someone doing research on a rare disease…..or if that foundation wants to give free drugs to the 50 kids in the nation who contract the disease. Foundations can spend on whatever they want.

    But I am troubled by public money going to such obscure causes. I would be right at home with the British commission that denies payment for any drug that does signficantly extend life and costs more than about $30,000.

    Reply

    1. Those are data points. They’re not data. Both appear in the paragraphs about zokinvy. I knew progeria is rare. Was hoping you might have researched data that supports e.g., “one in 4 million”.

  4. Bob, I forgot to add – $30,000 is a very low threshold. The dollar has lost 17% of its buying power just in the past year and a half.

    Most new cars cost much more than $30,000 and ones that don’t, often cost a big fraction of $30,000.

    Median annual rents for a 1-bedroom apartment in SF, NYC, LA, WDC range between $29,000 and $44,000.

    Even Obamacare prohibits insurance companies from setting any annual dollar limit on essential benefits.

    As Yogi Berra once observed “A nickel ain’t worth a dime any more.”:

    Reply

  5. Technically, the English limit on drug payments is 30,000 pounds per Quality Adjusted Year of Life — i.e, $38,332 right now.

    This debate comes down to an old theme of mine — namely, that the USA operates as though medical spending can be unlimited. (which it has been, by and large, since the 1960’s.)

    Other countries operate with more of a fixed budget for health spending. Money that is spent on Patient A is not available for Patients B, C, D, E, et al.

    So that the $10 million spent on drugs to stabilize a young hemophilia sufferer means that 300 senior citizens will not get a nurse visit every week.

    I think it was Thomas Sowell who said that there are no solutions, only trade-offs.

    Reply

    1. Yes that was Sowell – and hundreds of other economists over the centuries.

      The trade-offs can sometimes seem easy when an elderly person such as myself is “offed” in favor of a younger patient. But it’s not often that easy in large part because of the plaintiff’s bar. When medical care is intentionally withheld, lawsuits loom.

      In general, end-of-life care is an issue this country has not yet faced and needs to face. This is an area that dries out for leadership but our so-called leaders have been changing the subject and looking the other direction.

      I’m not in the camp that asserts the elderly have a duty to die, as a former Governor of Colorado once unfortunately stated. But we cannot continue along a path that devotes ever more resources to a shrinking population at the expense of the larger population. However this issue is solved, some are going to lose. That’s not just a technical problem of delivery. It’s also a political problem.

Join the conversation.