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  • Drug make raises prescription price 3,200%

    "In hindsight I regret pursuing transactions where a central premise was an increase in the prices" of the medicines, Pearson testified.
    Translation…”Damn, They caught us!”
    People like this gives hedge fund managers a bad name, the guy is already worth billions, so what does he do?
    Manipulates the market to eliminate competition then runs the price of life saving medicine up 3,200% because, of course, he is the only one making it.
    He should be water boarded.
    William Ackman, the New York billionaire and recently named Valeant board member whose hedge fund is among the drugmaker's biggest shareholders, said he called for a Thursday meeting where the board would consider price cuts for the four drugs discussed during the Senate hearing.

    "Pricing will be top of mind," for Valeant going forward, said Ackman
    Berna Heyman told a Senate committee Wednesday that her annual co-payment for a lifesaving drug needed to treat an ailment known as Wilson disease stayed below $700, a manageable cost, until 2013.
    That's when Valeant Pharmaceuticals International (VRX), an embattled Canada-based drugmaker, raised the price on Heyman's medication, said the retired Virginia librarian. By 2014, her projected co-pay topped $10,000 a year, with her health insurer paying more than $260,000, she said.
    "The drug is essential. People can die without it," Heyman testified at the Senate Special Committee on Aging hearing. "The drug company deserves the right to make a profit. But it is unconscionable that one company, Valeant, can hold Wilson disease patients hostage."
    The ailment is a rare genetic disorder that if left untreated causes a crippling and sometimes fatal buildup of copper in those struck by the illness.
    Heyman was one of three witnesses who questioned or criticized Valeant's business strategy of generating rapid growth by buying other drugmakers and then raising prices on some decades-old medications acquired through the transactions. The Senate panel spotlighted Valeant for its third hearing on sudden price spikes involving drugs for which the new corporate owners paid none of the medications' research and development costs.
    For instance, Valeant hiked prices on Nitropress, a drug used to treat dangerous heart conditions, by nearly 310% after acquiring the medication in a corporate acquisition, said Sen. Susan Collins, R-Maine, the committee's chairwoman. The company similarly imposed a 720% price increase on Isuprel, another heart drug, and a nearly 3,200% increase on Syprine, the medication needed by Heyman.
    "We can find nothing to explain these dramatic price increases beyond Valeant's desire to take advantage of monopoly drugs," said Collins. "To protect the American public, we must act to address these market failures."
    If this were true, you would repeal Obama Care
    http://www.usatoday.com/story/money/...ents/83601444/
    Dispite our best intentions, the system is dysfunctional that intelligence failure is guaranteed.
    Russ Travers, CIA analyst, 2001

  • #2
    Well, I can't completely put the blame on the pharma companies for this. The EU and other countries are holding down their drug costs in part by not allowing the same pharma companies to recoup their full research costs bringing new drugs to the market. The US is getting the lion's share of that cost dumped on their market.

    While I can't speak to the specific case above, you can see how this effects prices when the drug goes generic after the patents run out. The price plummets.

    So, beating down the pharma companies because they want to recover their massive research and testing costs on a new drug or on producing a drug that is used in miniscule quantities at considerable cost really isn't fair either. I think those nations that take advantage of this situation and force manufacturers to sell at below cost is unfair too.

    That isn't to excuse pharma companies from pursuing greed, but rather to absolve them of taking all the blame when a good share of it goes to government policy, rules, and regulations.

    Comment


    • #3
      It's old news, but typical of a greed policy brought on by excessive regulations and a willingness of insurance and Medicaid to pay those increases. And, it is not this orphan drug that has been affected. Lots of patented drugs sell for far more then the cost of production and a fair markup to recover the cost of development and make a profit. One only has to see what happened to the price of Atorvastatin Lipator when the patent expired.
      “Breaking News,”

      “Something irrelevant in your life just happened and now we are going to blow it all out of proportion for days to keep you distracted from what's really going on.”

      Comment


      • #4
        Originally posted by SRV Ron View Post
        It's old news, but typical of a greed policy brought on by excessive regulations and a willingness of insurance and Medicaid to pay those increases. And, it is not this orphan drug that has been affected. Lots of patented drugs sell for far more then the cost of production and a fair markup to recover the cost of development and make a profit. One only has to see what happened to the price of Atorvastatin Lipator when the patent expired.
        Please explain why the financial sector acted in a similar manner despite years of deregulation.....

        Comment


        • #5
          Originally posted by T. A. Gardner View Post
          Well, I can't completely put the blame on the pharma companies for this. The EU and other countries are holding down their drug costs in part by not allowing the same pharma companies to recoup their full research costs bringing new drugs to the market. The US is getting the lion's share of that cost dumped on their market.



          .
          Given that each country in the EU has its own health system and therefore its own drug acquisition policies and arrangements can you back this up with some explanation and evidence please? The British Health Service has been suffering from the same greedy policies by some pharma companies who recently put up prices on some essential drugs manyfold.
          Human history becomes more and more a race between education and catastrophe (H G Wells)
          Mit der Dummheit kaempfen Goetter selbst vergebens (Friedrich von Schiller)

          Comment


          • #6
            Originally posted by Paddybhoy View Post
            Please explain why the financial sector acted in a similar manner despite years of deregulation.....
            Apples and oranges, not at all related to the topic of extreme greed in pricing orphan and patented drugs.

            Federal interference by key Democrats forced the lending institutions to make risky home loans at abnormally low adjustable interest rates to those, usually poor minorities, that couldn't qualify for them in the first place. Others, taking advantage of those low rates, were encouraged to buy way more than what they could afford. This caused a massive spike in home prices. Those risky mortgages were then consolidated and sold to major investors with the promise of Federal backing through Freddie Mac and Fanny Mae. When those loans started defaulting en mass due to economic conditions, the housing market collapsed resulting in numerous upside down loans in foreclosures the banks got stuck with. The Feds were then forced into baling them out or lose their backing credibility.
            https://en.wikipedia.org/wiki/Financ...007%E2%80%9308
            “Breaking News,”

            “Something irrelevant in your life just happened and now we are going to blow it all out of proportion for days to keep you distracted from what's really going on.”

            Comment


            • #7
              Originally posted by MarkV View Post
              Given that each country in the EU has its own health system and therefore its own drug acquisition policies and arrangements can you back this up with some explanation and evidence please? The British Health Service has been suffering from the same greedy policies by some pharma companies who recently put up prices on some essential drugs manyfold.
              Socialized healthcare.

              If your product is incorporated (made reimbursable) into one of the major European healthcare systems sales will skyrocket.

              In a true free market a single dose will cost infinitely more, but total sales will be insignificant by comparison.

              So if you produce an easily reproduced product, Socialism - in this case - is more profitable, and will in the end outweigh research costs.

              It's still market economics - only the state performs the function of a (massive) predictable consumer.
              Last edited by Snowygerry; 28 Apr 16, 07:12.
              High Admiral Snowy, Commander In Chief of the Naval Forces of The Phoenix Confederation.
              Major Atticus Finch - ACW Rainbow Co.

              Comment


              • #8
                Originally posted by Snowygerry View Post
                Socialized healthcare.

                If your product is incorporated (made reimbursable) into one of the major European healthcare systems sales will skyrocket.

                In a true free market a single dose will cost infinitely more, but total sales will be insignificant by comparison.

                So if you produce an easily reproduced product, Socialism - in this case - is more profitable, and will in the end outweigh research costs.

                It's still market economics - only the state performs the function of a (massive) predictable consumer.
                Still doesn't explain the statement that the EU forced pharmacos not to recover research and development costs.
                Human history becomes more and more a race between education and catastrophe (H G Wells)
                Mit der Dummheit kaempfen Goetter selbst vergebens (Friedrich von Schiller)

                Comment


                • #9
                  Well they "force" them in the sense they make them an offer that's very hard to refuse.

                  Remove R&D costs and patent rights and sell xxxx units, or sell x units at full price.

                  Note that doesn't work for all - only products that are easily reproduced.
                  High Admiral Snowy, Commander In Chief of the Naval Forces of The Phoenix Confederation.
                  Major Atticus Finch - ACW Rainbow Co.

                  Comment


                  • #10
                    Originally posted by MarkV View Post
                    Given that each country in the EU has its own health system and therefore its own drug acquisition policies and arrangements can you back this up with some explanation and evidence please? The British Health Service has been suffering from the same greedy policies by some pharma companies who recently put up prices on some essential drugs manyfold.
                    If the U.S. imposed Euro-style price controls, pharmaceutical R&D would dry up faster than a puddle of water in Death Valley...
                    How The US Subsidizes Cheap Drugs For Europe
                    BY ELIZABETH WHITMAN @ELIZABETHWHITTY ON 09/24/15

                    The price of a medical miracle varies by country. Imatinib -- also known as Gleevec -- was hailed as a miracle cure to treat chronic myeloid leukemia, a rare type of cancer, upon the drug's approval in 2001. In the U.S., a year of treatment cost $92,000 in 2013. Everywhere else in the world, including in developed countries, it cost far less. Germany’s price tag was $54,000. In the U.K., it was $33,500 for annual care.

                    Medicines in the U.S. frequently cost significantly more than the same versions in other advanced countries. The ongoing scrutiny over drug pricing systems, in the spotlight this week following the decision of Turing Pharmaceuticals to raise the price of its drug Daraprim from $13.50 per pill to $750, has reignited debate over price controls in the U.S. But what often goes overlooked in these discussions is the fact that pricey medicines in the U.S. actually subsidize research and development for the rest of the world, and for all the proposals to lower drug prices in the U.S., a solution to this particular imbalance is nowhere in sight.

                    “It’s not fair that people in France pay a lot less for drugs than we do here. But there’s not much we can do about it,” Mick Kolassa, founding partner of Medical Marketing Economics, a consulting firm based in Mississippi, said.

                    In Europe, drug prices are set by governments, not by pharmaceutical companies the way they are in the U.S. On average, the difference between the price of one drug in the U.S. and the same drug in France, Germany, Italy, Spain and the U.K. was 50 percent, an analysis by the consulting firm McKinsey has found.

                    “U.S. consumers are in fact subsidizing other countries’ public health systems, at least with respect to drug pricing,” Jacob Sherkow, an associate professor at New York Law School, said.

                    These price discrepancies and their implications are well known throughout the industry but rarely discussed outside of it. Pharmaceutical companies have long defended the high price of drugs as necessary to pay for the research and development of new drugs, but the differences in pricing essentially means that consumers in the U.S. are contributing more than those in other countries. The U.S. accounted for 46 percent of global life sciences research and development--the vast majority of which is in biopharmaceuticals--according to the December 2013 issue of R&D Magazine.

                    [...]

                    Drug companies could cover the costs of the same research by lowering prices—companies would simply have to accept lower profits, against the will of shareholders and investors, and lower executive compensation, critics say. Some also point to excessive sales and marketing costs as pushing up drug prices—and sometimes even exceeding spending on research and development.

                    [...]

                    The average cost of developing a new drug ranges from $800 million to $1.2 billion and takes an average of 10 to 15 years from initial discovery to being delivered to the patient, according to the Indiana-based drug company Eli Lilly. In 2014, the company had more than $19.6 in revenue, of which $4.73 billion, or 24 percent, went to R&D, according to its 2014 annual report.

                    [...]

                    To Kolassa, popular outrage over drug pricing can be partially explained by a lack of understanding that drugs simply cost money. “We’ve got a real problem, that people want drugs to be free but don’t understand that the new ones only come out of the old ones,” he said. “We tend to not appreciate the value of pharmaceuticals,” he added.

                    As a result, whether pricing structures are fair or not, the fact that other developed countries pay less for drugs has another consequence that is often overlooked: “It limits the availability of new drugs,” Kolassa said.

                    [...]

                    http://www.ibtimes.com/how-us-subsid...europe-2112662


                    The standard socialist response to this is:

                    Drug companies could cover the costs of the same research by lowering prices—companies would simply have to accept lower profits, against the will of shareholders and investors, and lower executive compensation, critics say. Some also point to excessive sales and marketing costs as pushing up drug prices—and sometimes even exceeding spending on research and development.


                    Pharmaceutical companies are not in business to to R&D and create miracle drugs for the good of humanity. They are in business to make money for the shareholders and investors PERIOD. If they were forced to cut prices they would cut R&D to $0 before they would sacrifice earnings.
                    Watts Up With That? | The world's most viewed site on global warming and climate change.

                    Comment


                    • #11
                      Well there's no such thing as free lunch, somebody pays
                      High Admiral Snowy, Commander In Chief of the Naval Forces of The Phoenix Confederation.
                      Major Atticus Finch - ACW Rainbow Co.

                      Comment


                      • #12
                        Originally posted by Snowygerry View Post
                        Well there's no such thing as free lunch, somebody pays
                        While this doesn't necessarily justify Valeant's 3200% price hike, it is an inescapable fact of life.
                        Watts Up With That? | The world's most viewed site on global warming and climate change.

                        Comment


                        • #13
                          Originally posted by SRV Ron View Post
                          Apples and oranges, not at all related to the topic of extreme greed in pricing orphan and patented drugs.

                          Federal interference by key Democrats forced the lending institutions to make risky home loans at abnormally low adjustable interest rates to those, usually poor minorities, that couldn't qualify for them in the first place. Others, taking advantage of those low rates, were encouraged to buy way more than what they could afford. This caused a massive spike in home prices. Those risky mortgages were then consolidated and sold to major investors with the promise of Federal backing through Freddie Mac and Fanny Mae. When those loans started defaulting en mass due to economic conditions, the housing market collapsed resulting in numerous upside down loans in foreclosures the banks got stuck with. The Feds were then forced into baling them out or lose their backing credibility.
                          https://en.wikipedia.org/wiki/Financ...007%E2%80%9308
                          You're completely off topic. We're talking about the pharma industry, which is like Big Oil - taking in record profits for over-priced drugs that often carry lethal side effects.

                          If you want to know a drugs true costs, check what it goes for in third world nations, sold by the same companies that gouge everything they can out of the rest of the world for the same product.

                          You do understand the significance of a 3,200% price increase in real terms, right?
                          Quis Custodiet Ipsos Custodes? Who is watching the watchers?

                          Comment


                          • #14
                            People should be concerned about Valeant's shady practices. For the past few months they've been making the business news in Canada for all sorts of questionable practices. IIRC they were accused of accounting irregularities related to non-arm's length subsidiary pharmacies.

                            See below for a start
                            http://nymag.com/daily/intelligencer...to-pariah.html

                            Comment


                            • #15
                              Originally posted by Snowygerry View Post
                              Well there's no such thing as free lunch, somebody pays
                              Yeah...the sick and the dying. So what does that make the pharma companies? Leeches preying on victims.
                              Quis Custodiet Ipsos Custodes? Who is watching the watchers?

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