Big pharma companies agree to federal price negotiations “under protest”

They're not dropping their lawsuits, but they say they have no choice but to negotiate.

See full article...

 

[KingKrayola]

You might want to adjust your example. Paracetamol is OTC, and can be bought for bugger all (that 20p worth of Paracetamol sells for.... 20-25p....)

Edit: Though I do see that the UK regulators haven't yet cracked down on rebranding exactly the same dosage for different purposes and charging more. Nurofen (branded ibuprofen) in Australia got taken to court for selling exactly the same dosages for "period pain" and "migraines" at different prices.

It's more that (as I think a previous poster who had worked as a pharmacist hinted) if you get free prescriptions for some reason all your drugs are free.

Paracetamol, most antihistamines and so on are available without a prescription and are really poor value if you pay the prescription charge, as you point out.

 

[larrylava68]

Ladies and gentlemen, Yo Yo Ma playing the world's smallest cello...

 

[Ed1024]

IDK what the companies are complaining about. If it’s OK to hike drug prices by orders of magnitude when they have in reality probably become cheaper to produce using mature processes, because they can, then it must be OK for governments to arbitrarily increase their tax take from said products, because they can. It would also help said governments to pay for / subsidise other expensive medicines.

 

[Tom the Melaniephile]

I have absolutely no pity for these profiteers. I used to be a pharmacy tech and I know their markup is obscene, and to cap all the insults, all of these drugs are still under patent, and the drug companies won't allow any generic versions of them without a hell of a fight.

Or the company producing the name brand buys out the generic manufacturer and shuts down generic production...

Anyway: For those struggling with drug costs in the USA - most drug manufacturers have some kind of patient assistance / copay assistance / rebate / etc. It's never super obvious, so use your favorite search engine. The anti-tumor drugs I'm starting on Tuesday will cost me $0 out-of-pocket because I signed up for the manufacturer's copay card online - all I had to do to get it was fill out basic information online and the digital card was generated immediately. Then all I had to do was show the digital card image to the pharmacy.

For those outside the USA - yeah, I wish we had non-insane healthcare like you do.

 

[ardent]

I'm sure one of them has a drug for that, and that its price has only octupled in the last decade.

Whoa, hey, whoa. Are you expecting drugs that...cure conditions? Why would they create those when they can bury them instead and produce drugs that only control conditions?

 

[ralphnobody]

Behold the entitled.

Entitlement expectations like not permitting negotiation or expecting this is insane to me.

By the way: CA, NJ, and CO are the majority-pharmaceutical states. Two of those are strongly blue so don’t fall into the trap of blaming a single party.

 

[Sedreaus]

As others have said, fuck them on these drugs in particular, but also... Can't our state/federal government sue big sugar for actively hiding the risks of added sugar for decades? Seems like if we can go after tobacco we can go after these mother fuckers for actively putting a significant amount of our population in dialysis treatment centers.

 

[Nexus]

I find it interesting in the article, unless Im missing it, there isnt a single explanation from the quoted companies as to a "justification." for their prices?

I mean it's like they might as well come out and say the reason is "because its what the market can bear".

 

[SeanJW]

It's more that (as I think a previous poster who had worked as a pharmacist hinted) if you get free prescriptions for some reason all your drugs are free.

Paracetamol, most antihistamines and so on are available without a prescription and are really poor value if you pay the prescription charge, as you point out.

They're not referring to free medication, which is a different thing. They're referring to the fixed rate for prescription medication, which is the same thing Australia has (one rate for concession card holders, higher rate for non-concession card holders, everything on the PBS is that price).

 

[Bernardo Verda]

Ahh, the shampoo market segmentation..

Then next up would be the "strong" pain-killers in a black box, marketed at men. "Be a real man: Take a painkiller! Only 4x the cost, and same dose, but manly!"

I remember that time I carefully compared eight or ten different OTC cold and flu products from two or three different brands/companies... and discovered that despite the different promises/emphases on the packaging -- and the different prices -- they all had precisely the same amounts of precisely the same active ingredients. The only difference whatsoever was that some used ibuprofen (a.k.a. Advil) instead of acetominophin (a.k.a. Tylenol)

 

[Bernardo Verda]

Or the company producing the name brand buys out the generic manufacturer and shuts down generic production...

IIUC, name brand corporations have been known to subsidise generic manufacturers in exchange for maintaining a certain price, or otherwise making the generic version less attractive to the consumer.

 

[Veritas super omens]

It's not just "health". "Gaming and culture" is listed, yet it only goes to "gaming"; "culture" is its own, unlisted link.

Yeah... I opened every list: Biz & IT, SCIENCE, CARS, POLICY, GAMING & CULTURE ,TECH, even Store and forum. Not in any of them.

 

[Bernardo Verda]

IDK what the companies are complaining about. If it’s OK to hike drug prices by orders of magnitude when they have in reality probably become cheaper to produce using mature processes, because they can, then it must be OK for governments to arbitrarily increase their tax take from said products, because they can. It would also help said governments to pay for / subsidise other expensive medicines.

This post deserves being highlighted as an "Editor's Choice" comment.

 

[Veritas super omens]

IIUC, name brand corporations have been known to subsidise generic manufacturers in exchange for maintaining a certain price, or otherwise making the generic version less attractive to the consumer.

Yes. The first generic manufacturer to file an ANDA (abbreviated new drug application) is granted a 6 month market exclusivity. Brand manufacturers have been known to pay them to NOT market the drug. How's THAT for anticompetitive collusion.

 

[Veritas super omens]

Behold the entitled.

Entitlement expectations like not permitting negotiation or expecting this is insane to me.

By the way: CA, NJ, and CO are the majority-pharmaceutical states. Two of those are strongly blue so don’t fall into the trap of blaming a single party.

The laws that regulate that are federal. The regulatory body charged with preventing harm to the public is made up of 2 major parties. One is almost always the major culprit in protecting these companies from anything remotely resembling "a well regulated market". I'll let you guess which party that is.

 

[Rookie_MIB]

Anyway: For those struggling with drug costs in the USA - most drug manufacturers have some kind of patient assistance / copay assistance / rebate / etc. It's never super obvious, so use your favorite search engine. The anti-tumor drugs I'm starting on Tuesday will cost me $0 out-of-pocket because I signed up for the manufacturer's copay card online - all I had to do to get it was fill out basic information online and the digital card was generated immediately. Then all I had to do was show the digital card image to the pharmacy.

Maybe the government should just offer a variation of this to the drug companies? Institute a 95% tax and a cap on prices, then force the drug companies to apply for a limited number of spots to reduce that tax to like... 90% and a 10% increase on the price cap?

I mean really, they'll save big! Right? Right?!?

 

[DovePig]

Yeah... I opened every list: Biz & IT, SCIENCE, CARS, POLICY, GAMING & CULTURE ,TECH, even Store and forum. Not in any of them.

Seems to be fixed? It does show up on the most recent Ars front page as https://meincmagazine.com/health/2023...-to-federal-price-negotiations-under-protest/

Oh, you meant it doesn't show up in the category lists. Yep. Still doesn't.

 

[ralphnobody]

The laws that regulate that are federal. The regulatory body charged with preventing harm to the public is made up of 2 major parties. One is almost always the major culprit in protecting these companies from anything remotely resembling "a well regulated market". I'll let you guess which party that is.

And you believe the Federal level legislators aren’t protecting their cashcows?

State level: https://www.sacbee.com/news/politics-government/capitol-alert/article24913978.html

Federal level: https://www.statnews.com/feature/prescription-politics/federal-full-data-set/

I don’t have to guess. The data is there if enough people could be bothered to move past party biases/assumptions.

 

[orwelldesign]

Of course you could let the government develop drugs but if you want to see how well that works, look at other government programs.

This is objectively false.

There are plenty of government programs that work, that work well, and that work better than they could with a profit motive.

There's plenty of things where government programs work at least "okay" or even "pretty good," though there's not that much "great."

For instance: MediCal, the California poor people insurance, works pretty good. Social security, so that old people without families don't literally die in the street from starvation, works pretty good.

And, of all those social programs, more funding would make them work better. There's nothing inherent to government programs that makes them not work.

That is a right wing talking point, and an outright lie. It comes not from a belief that the government can't do those things, rather, that they shouldn't -- and a lot of that "shouldn't" comes from racism. The myth of the Welfare Queen is an overarching belief that government benefits shouldn't go to those people.

 

[F MHilton]

I find it interesting in the article, unless Im missing it, there isnt a single explanation from the quoted companies as to a "justification." for their prices?

Who the hell needs 'justification' besides, "Because we can!"?

Or as the old blackmail technique does: "Pay us or die."

Sadly, it works.

 

[ralphnobody]

There is that.

I agree that drug prices are too high for some meds but it should also be recognized that these things can cost a great deal to develop so we need to be sure that the overly aggressive forced pricing does not disable or significantly hamper developments. That may play well to the taxpayer or patient, but is not a great idea.

Basically, one needs to know (and this is the hard part) the real cost of development and production and this should be taken into account so is to allow a reasonable (whatever that is, needs definition) profit.

No one is going to start a drug company so as to break even or lose money, so despite "profit" being a dirty word in some circles, some profit has to happen or the whole new drug pipeline goes away and the drug companies go back to selling only old and cheap medications.

Of course you could let the government develop drugs but if you want to see how well that works, look at other government programs.

You can have your bad-faith negotiation, provided state and local governments are allowed to manufacture and sell patent-free prescription like insulin; unencumbered by bullshit rules that favor rent seeking.

While we’re at it, also allow import of the same patent free-drugs from first world countries that aren’t encumbered by our bipartisan level of rent seeking.

Though really believe we need government at different levels threaten to step-in as competition when drug companies
distort the rules, as they’ve currently done.

 

[SeanJW]

This is objectively false.

There are plenty of government programs that work, that work well, and that work better than they could with a profit motive.

There's plenty of things where government programs work at least "okay" or even "pretty good," though there's not that much "great."

For instance: MediCal, the California poor people insurance, works pretty good. Social security, so that old people without families don't literally die in the street from starvation, works pretty good.

And, of all those social programs, more funding would make them work better. There's nothing inherent to government programs that makes them not work.

That is a right wing talking point, and an outright lie. It comes not from a belief that the government can't do those things, rather, that they shouldn't -- and a lot of that "shouldn't" comes from racism. The myth of the Welfare Queen is an overarching belief that government benefits shouldn't go to those people.

Part of it comes from the peculiar American belief of being afraid of the government you chose for yourself. Pretty much every other (functional) democracy in the world believes very strongly in electing people to do a job, and then making them do the job. If they don't, they get removed from office.

 

[real mikeb_60]

Part of it comes from the peculiar American belief of being afraid of the government you chose for yourself. Pretty much every other (functional) democracy in the world believes very strongly in electing people to do a job, and then making them do the job. If they don't, they get removed from office.

There's no practical way for the voters to remove a US politician from their job, other than voting for somebody else next time they come up for reelection. Yes, there are impeachment processes, but those are not governed by the voters; rather they're done by the politicians' colleagues for real, imagined, or political power reasons. In a place like the House of Representatives, where all members are up for reelection every 2 years, impeachment would take too long. For Presidents and other elected executives (4 years) or senators (6 years), impeachment is more feasible. Of course, elections are subject to shenanigans too (see: gerrymander for instance), and the incumbent usually wins if they run.

That's all facts of life. Yes, it's traditional that US citizens are afraid of their government, which makes no sense if they would or could elect people who want to do the job rather than maintain power forever. But the sense of powerlessness is cultivated by politicians as a way to get and maintain power (and wealth) for themselves. If Americans would wake up and discover the power they actually have, within the system, the results could be anywhere between amusing and disastrous. Be careful what you ask for.

 

[Bernardo Verda]

This is objectively false.

There are plenty of government programs that work, that work well, and that work better than they could with a profit motive.

There's plenty of things where government programs work at least "okay" or even "pretty good," though there's not that much "great."

For instance: MediCal, the California poor people insurance, works pretty good. Social security, so that old people without families don't literally die in the street from starvation, works pretty good.

And, of all those social programs, more funding would make them work better. There's nothing inherent to government programs that makes them not work.

That is a right wing talking point, and an outright lie. It comes not from a belief that the government can't do those things, rather, that they shouldn't -- and a lot of that "shouldn't" comes from racism. The myth of the Welfare Queen is an overarching belief that government benefits shouldn't go to those people.

I stopped believing in the honesty of the "conservative" mantra about government programs and government spending, versus private enterprise, shortly after I gained some experience working for a very large corporation.

I far as I can see, the biggest issue is how many layers there are between the top policy/project decision-makers and the people "on the ground" in charge of implementing those policies/programs, and the accountability around that.

 

[brionl]

That's all facts of life. Yes, it's traditional that US citizens are afraid of their government, which makes no sense if they would or could elect people who want to do the job rather than maintain power forever. But the sense of powerlessness is cultivated by politicians as a way to get and maintain power (and wealth) for themselves. If Americans would wake up and discover the power they actually have, within the system, the results could be anywhere between amusing and disastrous. Be careful what you ask for.

People aren't afraid of "their team's" politicians. They are afraid that the "other guys" are going to pull some nefarious shenanigans. The crazy wing of the Republican party is afraid that the Democrats will take all their guns and sell out the country to the Commu-Nazi UN occupation forces. The Democrats (and any "independents" who aren't closet Republicans) are afraid that the Fascist wing of the Republican party is going to storm the Capital Building and try to install a dictatorship. Again, only not as stupidly this time.

 

[billbo63]

Or the company producing the name brand buys out the generic manufacturer and shuts down generic production...

Anyway: For those struggling with drug costs in the USA - most drug manufacturers have some kind of patient assistance / copay assistance / rebate / etc. It's never super obvious, so use your favorite search engine. The anti-tumor drugs I'm starting on Tuesday will cost me $0 out-of-pocket because I signed up for the manufacturer's copay card online - all I had to do to get it was fill out basic information online and the digital card was generated immediately. Then all I had to do was show the digital card image to the pharmacy.

For those outside the USA - yeah, I wish we had non-insane healthcare like you do.

Or they simply bribe the generic manufacturer before it even comes to market.

 

[Sulne]

The vast majority of pricing is negotiated by the NHS as a single block (I think) and you generally don't get to ask for a particular brand.

Most medicines for hospitals are based on regional contracts and set formularies and will go with whatever is cheapest and available (or did, it might have changed since I left the profession). Also, NHS hospitals (mostly) go by the drug and not brand (since most, if not all of the time brands are expensive). Doctors are 'encouraged' to stick to the set list of drugs, but occasionally might prescribe what is termed 'non-formulary' (if for example the first drug proves ineffective / unsuitable due to ingredients used) or prescribe something that lacks a license in the UK (for extreme cases, although the doctor assumes responsibility). Quite often if this is excessive in cost the pharmacist will just tell the doctor to prescribe something normal- one example was when a doc requested a £50 jar of bespoke nail fungal treatment and the pharmacist is like 'nah' (and dispenses something that was near identical and costed £5). On hospital discharge a patient will be given generics.

The other factor is NICE, who (when they get a move on) actually test the efficacy of a drug to see if its value for money- so if you have a more expensive drug that has little benefit over a cheaper one it will not be offically recommended.

 

[ab78]

What I never quite understand with the US system is why there isn't already negotiation. Since so much of your healthcare system rests on use of private health insurance, it would seem that there should be a good incentive for the big private health insurance companies to negotiate hard on drug prices so that they are able to be more competitive in the marketplace themselves. After all isn't it pretty much rule number 1 of business to drive down your costs?

 

[Papewaio]

What I never quite understand with the US system is why there isn't already negotiation. Since so much of your healthcare system rests on use of private health insurance, it would seem that there should be a good incentive for the big private health insurance companies to negotiate hard on drug prices so that they are able to be more competitive in the marketplace themselves. After all isn't it pretty much rule number 1 of business to drive down your costs?

Not if they own the pharmaceutical companies or if they can charge a % markup. Or some other sort of for profit financial shenanigans.

Oh look we can only make 20% profit margins. So that $5 insulin for the rest of the world better be $100 in the US. Now we can make 20x the profit.

Not saying that is a legit example, but there is probably profit motives to maintaining the high prices. Which would be referred to as cartel practices in most places.

 

[launcap]

Excellent news. Not so long ago a few US States allowed their pharmacies to supply themselves in Canada, especially for insulin which is vastly cheaper North of the border.

It's the same insulin coming out of the same factories. But Canada negotiates prices.

I'm on an Embrel generic (was on Embrel itself - or the UK brand-name version of it). I was told that the original cost was about £12k/year - none of which I paid because of the NHS. I then moved to the UK brand of Etanercept (about £10k/year) and, when it became available, the generic form of Etanercept. Current cost of my generic? £2.5k/year.

If I'd lived in the US my medication bill would have bankrupted me years ago because I doubt whether any insurance company would have taken me as a client.

 

[theSeb]

My thoughts and prayers for the poor Pharma execs.

 

[Northbynorth]

An international context would really help understand what's possible. What are the standard practices for diabetes drug pricing in Australia, France, Norway, and the UK? What about countries with systems slightly more similar to the US, like India or Switzerland? And throw in Cuba and China too for a wilder comparison - are these drugs even available there, or are equivalents?

Norway here.
I use two drugs on that list (in addition to a couple more non-listed). I checked US prices for those two, and it would have cost me about $90.000 for one year. Instead I pay a maximum of $300 total a year, including all drugs I need, tests and all appointments to doctors and other health staff.

Of course, people complain if they from time to time raise that maximum cost with $50.
Edit: spelling

 

[ReedmanBassoon]

There is a simple solution.

Let anyone in the US with a prescription get that prescription filled anywhere in the world. If I want to get drugs in Canada and bring them back, don't have any impediments at the Canadian pharmacy or at the border.

 

[vedekhaliwell]

The one thing everyone seems to miss is this:

We Americans have to cover the cost of other nation's free and discounted medication costs. That is part of the reason drugs here are so expensive on a cash basis. Well, that and basic greed.

Americans with insurance get Pharmacy Benefit Managers who decide what costs the insurance company will cover and/or decide if they will cover it at all. The PBMs have a heck of a lot of influence on drug manufacturers since they represent millions of people.

As a pharmacist, I see what the actual list price is for thousands of drugs. Sure once they drop to generic the costs rapidly decrease (for the most part) but thanks to the drugs' protection it takes a long time to go generic. I unfortunatly have to be the bearer of bad news at times, with the cost information or the "it is not covered by your insurance" conversation.

 

[marsilies]

The one thing everyone seems to miss is this:

We Americans have to cover the cost of other nation's free and discounted medication costs. That is part of the reason drugs here are so expensive on a cash basis. Well, that and basic greed.

You could've just stated the last part and been good.

If you think drug companies are taking a loss in other countries, you're nuts. They're not forced to distribute their drugs in other countries, and if it wasn't profitable, they'd stop. It's just not as insanely profitable for them as it is in the US, as we've basically had zero regulation/price control up to now.

As for Pharmacy Benefit Managers...


View: https://www.youtube.com/watch?v=5rw4kNHNZyk

 

[marsilies]

There is a simple solution.

Let anyone in the US with a prescription get that prescription filled anywhere in the world. If I want to get drugs in Canada and bring them back, don't have any impediments at the Canadian pharmacy or at the border.

"Anywhere in the world" seems like a stretch. Like, do you want medication from a country with basically zero regulations on drug safety to be able to flood the US market with cheap, potentially unsafe medication?

We saw a little bit of this when we had the hand sanitizer shortage, and the FDA discovered 84% of the hand sanitizer being imported from Mexico was toxic or flawed:
https://meincmagazine.com/science/202...ers-toxic-or-flawed-fda-issues-drastic-alert/
Personally, I'd be ok with Canada's drug standards, but the FDA already allows personal importing of drugs from Canada under certain conditions:
https://www.fda.gov/media/158659/download

 

[orwelldesign]

People aren't afraid of "their team's" politicians. They are afraid that the "other guys" are going to pull some nefarious shenanigans. The crazy wing of the Republican party is afraid that the Democrats will take all their guns and sell out the country to the Commu-Nazi UN occupation forces. The Democrats (and any "independents" who aren't closet Republicans) are afraid that the Fascist wing of the Republican party is going to storm the Capital Building and try to install a dictatorship. Again, only not as stupidly this time.

Except... the Democrats aren't doing that, while the Republicans are.

Republicans built their power on fear. And hurt. They are an embodiment of Orwell's principle that power is only power if you use it to hurt people: getting people to do things they want to do isn't power, according to that view. That one lady (can't find the cite, but it definitely exists) said it out loud, about Trump: "he's not hurting the right people."

Power for its own sake is disgusting.

 

[JohnDeL]

ROFL! He doesn't even know what planet he's on anymore.

Is it Planet Trump Is A Fraud? Or Planet Trump Is A Rapist?

 

[FxzlmS]

Seeing articles calling MSD "Merck" always irks me. While MSD has the rights to that name in North America (only), since there is another company in the same area going by that same name, "MSD" is typically also used by people in the pharma field from/in the US, just to avoid confusion. I'd appreciate if a publication like Ars would do the same, despite being US-based.