Last month, Turing Pharmaceuticals caused widespread outrage when it raised the price of the drug Daraprim from $13.50 a pill to $750. Daraprim is a critical life-saving drug that is decades old, but was only available from Turing.
The good news is that all the publicity attracted the attention of another drug company, Imprimis Pharmaceuticals. Imprimis has just announced an alternative to Daraprim, which they have priced at a much more reasonable $1 a pill.
Imprimis also said it has plans to produce more cheap alternative drugs. Their goal is to come out with more affordable versions of the 7,800 generic FDA-approved drugs.
It remains to be seen whether this is just a clever marketing ploy, or if Imprimis is really serious about creating more competition for prescription drugs. But it is a good start.
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And the new low, low price came as a result of Turing raising the price. Now Turing can put it back to $750 a pill to see if anyone bites.
I think England charges even less than $1.
This fiasco is only the latest episode and tip of the iceberg of the industry’s propensity to manipulate prices and reduce competition. Turing and others, like Valeant, are under investigation for using arcane FDA regulations, under the guise of patient safety, to keep generic competitors out by limiting access to sufficient quantities of their drugs needed to conduct the clinical studies required to compare and demonstrate bioequivalence.
Another sinister marketing ploy is the emergence of compounding pharmacies. These outfits, often affiliated with if not outright owned by, the drug companies whose drugs they compound, take cheap generic OTC drugs and concoct mixtures that are then sold under a new label under prescription at astronomical markups. As a recent NYT article describes the operation:
“It is called “Prescriptions Made Easy.” Instead of sending their patients to the drugstore with a prescription, doctors are urged by Horizon to submit prescriptions directly to a mail-order specialty pharmacy affiliated with the drug company. The pharmacy mails the drug to the patient and deals with the insurance companies, relieving the doctor of the reimbursement hassle that might otherwise discourage them from prescribing such an expensive drug.”
http://www.nytimes.com/2015/10/20/business/drug-makers-sidestep-barriers-on-pricing.html?emc=edit_tnt_20151026&nlid=10655178&tntemail0=y
Exhibit A in the article is Duexis, a combination of the generic equivalents of Motrin and Pepcid. As the article begins: “If prescribed separately, the two drugs together would cost no more than $20 or $40 a month. By contrast, Duexis, which contains both in a single pill, costs about $1,500 a month.” There are many more such examples of this strategy to keep prices artificially high.
Until we demand of our esteemed political leaders adequate oversight and regulation of the pharmaceutical and overall healthcare market, costs will continue to escalate out of control. There are endless clever and opaque marketing strategies, and too many middlemen, for this sector to ever be a truly “free” and level playing field. Pharmaceuticals are, by any measure, a relatively small fraction (~10-15%) of our overall healthcare spending in this country (hospital charges far exceed), but it is symptomatic of an increasing trend of a market that actively works to discourage and limit competition while fiercely resisting sensible regulatory oversight. Another perverse example of a Congress bought and paid for.
As someone who has long worked in the drug discovery field, not marketing, I am nonetheless often reluctant these days to admit to new acquaintances even being associated with the industry. It is almost unrecognizable from when I first entered the field back in the ’80s.
Thanks Ralph.
Let’s hope Imprimis begins making a generic for Gleevec.