Pfizer loses nearly a BILLION dollars on drug R&D

[SpicyMcVoodoo]

Originally Posted by 7960

In the same post you complain that the drug companies have a monopoly but also recognize that they wouldn't be making the drugs if they didn't.

So in your world these drugs don't exist....... ?

I'm pointing out that the terms of the government granted monopoly are up to negotiation. Somewhere in theoretical land, there are optimum monopoly terms which benefit the company and humanity best. Who knows if we've reached that optimal compromise. Maybe the compromise we've reached is not optimal for both the company and humanity. Maybe it's optimal for the company at the expense of humanity.

[nbiggershaft]

Originally Posted by 6SpeedTA95

it makes you LESS sympathetic to drug companies? that makes zero sense to me, please elaborate.

When a drug company sells something for X dollars here, then the same company sells the exact same drug for less in canada. Makes their whole price setting scheme seem pretty flexible.

[JaJae]

Originally Posted by nbiggershaft

When a drug company sells something for X dollars here, then the same company sells the exact same drug for less in canada. Makes their whole price setting scheme seem pretty flexible.

The price is fixed based on the economies. Americans can afford to pay more than Canadians. In fact, go on Kelly Blue Book's website you'll see cars are sold for different prices in different states/zip codes. It's the same principle, just on the international scale. Drug companies aren't the only businesses doing this. They set their prices based on supply and demand as well as people's ability to pay... just like any other product in a capitalist society. I don't think it's the drug companies you have a problem with as much as it may be the non-socialist economic market. But if America adopts the socialist method you run into the problem of just not having the medications... at all. When the incentive is taken away to generate new cures and medication why would a company like Pfizer spend over $8 on R&D? The simple answer is, they won't.

[6SpeedTA95]

Originally Posted by nbiggershaft

When a drug company sells something for X dollars here, then the same company sells the exact same drug for less in canada. Makes their whole price setting scheme seem pretty flexible.

thats called smart business, ever heard of sunk costs?

[hsmith]

Originally Posted by nbiggershaft

When a drug company sells something for X dollars here, then the same company sells the exact same drug for less in canada. Makes their whole price setting scheme seem pretty flexible.

then the real issue there is the US Federal Gov't that doesn't allow you to purcahse medicines in Canada and bring them home.

Nice try trying to blame the drug companies though

[SpicyMcVoodoo]

Originally Posted by hsmith

then the real issue there is the US Federal Gov't that doesn't allow you to purcahse medicines in Canada and bring them home.

Nice try trying to blame the drug companies though

Yet another reason this is hardly a free market question here. First, the government grants pharma co's a monopoly in America by keeping out generic manufacturers. And then the government makes it illegal for the people to leave America to buy the same drugs being sold for cheaper elsewhere.

Something tells me if we truly let the free market work on the drug situation, we'd end up with a lot fewer drugs because profit incentives would go down. These pharma co's depend way too heavily on the government to protect their profits. Could this be a case where the free market does not yield the best results?

[AVengeance]

Originally Posted by Scrumtralecent

No, it just makes me siick that they prey on the sickets people to pay these high prices.

Chemo patents take a drug called Zofran(sp?) to help ease nausea. The pill, when my Dad was taking it, cost over $30 a pill. $30 every few hours so you aren't trapped in the bathroom wishing you were dead.

I know these companies are in it to make money and i'm not saying they should give their product away, but they have no interest in helping people. Their only interest is the bottom line. Maybe they should cut back on the lobbyists and pass the savings on to use.

Chemo patients COULD be taking pot, but the wonderful government and their "anti-drug" policy (that is really a anti-drug-we-don't-get-money-under-the-table-for policy) makes sure we're filled to the rim with artificial harmful chemicals. The same companies that develop complex chemicals design to make food addictive are the same companies developing the pill "cures". I don't go around selling shitty tires that will blow out just so I can sell more aluminum wheels later. That would be unethical.

[kinggovernor]

Originally Posted by hsmith

then the real issue there is the US Federal Gov't that doesn't allow you to purcahse medicines in Canada and bring them home.

Nice try trying to blame the drug companies though

government regulation of controlled substances is a good thing

[SpicyMcVoodoo]

Originally Posted by kinggovernor

government regulation of controlled substances is a good thing

do you honestly believe the reason we can't buy prescription drugs from Canada is to protect us?

[kinggovernor]

Originally Posted by SpicyMcVoodoo

do you honestly believe the reason we can't buy prescription drugs from Canada is to protect us?

yes

[6SpeedTA95]

Originally Posted by SpicyMcVoodoo

Yet another reason this is hardly a free market question here. First, the government grants pharma co's a monopoly in America by keeping out generic manufacturers. And then the government makes it illegal for the people to leave America to buy the same drugs being sold for cheaper elsewhere.

Something tells me if we truly let the free market work on the drug situation, we'd end up with a lot fewer drugs because profit incentives would go down. These pharma co's depend way too heavily on the government to protect their profits. Could this be a case where the free market does not yield the best results?

Generic drug makers aren't forced out of the market, btw pfizer and merck are also generic drug makers.

[6SpeedTA95]

Originally Posted by kinggovernor

yes

thats not the primary reason but it is a very small reason in reality

[imind]

This is a perfect example of just whats at stake and part of the reason drug prices are so high.

you've (nor anyone else for that matter) done nothing to illustrate this point other than to make the claim and point to an atypical, devastating yes, but atypical case of R&D failure. how much does it cost to develop drugs? this article suggests much less than what the industry claims...

New drug discoveries are much cheaper than the industry claims: A year ago the industry claimed it cost $500 million to discover a new drug (including failures). A more recent study from a Tufts University research institute, which receives most of its funding from the drug industry, put the figure at $800 million. Actually the $800 million figure is no more than $240 million for the following reasons: the industry counts the opportunity cost of capital, not actual cash outlays, which inflates the estimate by about 50 percent; and the industry’s analysis does not reduce the costs of R&D by 34 percent, which is the amount that is tax deductible. In addition, the study only looks at the most innovative – and therefore most expensive – drugs being developed. But about half of new drugs are "me-too" drugs, which often replicate existing successful drugs.

link

but is it even less?

Although the pharmaceutical industry maintains that research and development for each new drug totals $500 million, a new report by Public Citizen puts the cost at about $110 million, the Boston Globe reports.

kaiser network

and taxpayers oftentimes find themselves paying for this R&D...

Industry R&D risks are significantly reduced by taxpayer-funded research: The federal government has helped launch some of the most medically important drugs in recent years and received little, if anything, for its investments. An internal National Institutes of Health document shows that taxpayer-funded scientists conducted 55 percent of the research projects that led to the discovery and development of the top five selling drugs in 1995.

same link

and money spent on advertising is outpacing money spent on R&D...

Drug company advertising is growing faster than R&D: Major drug companies are increasingly resembling marketing machines rather than inventors of drugs. Drug industry spending on advertising increased at a far greater rate (32 percent) in 2000 than spending on R&D (13 percent). Such advertising is fueling a major increase in drug costs.

would more govt regulation lower costs while allowing the industry to be profitable and maintain its effectiveness? how is europe doing?

Experience in Europe: To control drug costs European countries either impose price controls or limit drug company profits. Yet European drug companies – such as Glaxo, Aventis, AstraZeneca and Roche – are very successful, highly profitable and just as innovative as U.S. companies. From 1990-1999, European-based companies introduced 183 new chemical entities to the world market whereas U.S. drug companies introduced 161.

same link

and a sidenote...

Far from being an exemplar of the free market, the pharmaceutical industry enjoys many government protections and subsidies. In addition to benefiting from publicly funded research, drug companies have low tax rates, because they can deduct their marketing expenses as well as their research and development costs.

Most important, their drugs enjoy l7-year (or longer) patent protection. Once a drug is patented and given a brand name, no one else may sell it, and the company is free to charge whatever the market will bear without fear of competition from generics. No wonder drug companies fight to extend the life of their patents and to obtain new patents for old drugs. That can be done merely by proposing a new use or a different dosage form, or by combining two old drugs into a single new pill. The anti-diabetes drug Glucophage XR, for example, is Bristol-Myers Squibb's newly patented once-daily replacement for the twice-daily Glucophage, whose patent expired last fall.

The drug companies devote enormous sums to promoting their interests. They have the largest lobby in Washington, and contribute copiously to political campaigns. Half the FDA's budget for the evaluation of new drugs now comes from drug company users' fees, making the agency dependent on the industry it regulates -- an obvious conflict of interest. The industry also spends lavishly to influence doctors, who write the prescriptions, and medical researchers, who test the drugs.

Last year drug companies spent more than $8 billion and employed 83,000 sales representatives to woo doctors. They provided them with gifts, meals and trips, as well as another $8 billion worth of free drug samples. The companies fund and thereby influence much of the continuing medical education doctors need to renew their licenses, and they handsomely support the scientific meetings of medical societies, where they hawk their wares and often sponsor their own programs.

washington post

[kinggovernor]

Originally Posted by 6SpeedTA95

thats not the primary reason but it is a very small reason in reality

it is to protect consumers and to protect companies' IP

[hsmith]

Originally Posted by SpicyMcVoodoo

Yet another reason this is hardly a free market question here. First, the government grants pharma co's a monopoly in America by keeping out generic manufacturers. And then the government makes it illegal for the people to leave America to buy the same drugs being sold for cheaper elsewhere.

Something tells me if we truly let the free market work on the drug situation, we'd end up with a lot fewer drugs because profit incentives would go down. These pharma co's depend way too heavily on the government to protect their profits. Could this be a case where the free market does not yield the best results?

There actually are contractal ways to overcome monopoly laws such as patents. Patients signing NDA's and the like when purchasing the medications.

Tylenol has had generics competing with them for years and they have still been raking in cash.

[hsmith]

Originally Posted by kinggovernor

government regulation of controlled substances is a good thing

No, it is not. There is no reason to need to go to a doctor to get a prescription for drugs (consulting with a doctor about what to take, yes). It makes the poor unable to afford medication because they can't afford the $100 premium to visit the doctor.

A large majority of other first world countries do NOT have prescriptions for non-narcotic medications, because it doesn't make sense. They purchase the large books that help you choose which med to take and consult wit their pharmacist.

[ballz2wallz]

Originally Posted by 6SpeedTA95

btw pfizer and merck are also generic drug makers.

Not really; a 'generic drug maker' is someone who profits solely on the research other companies are doing, maximizing on the fact that the patents are up and the technology is a free for all.

Pfizer and Merck are research companies, and do initial research on drugs. That alone makes them not a 'generic drug maker'. I'm assuming you mean they are also maximizing on ended patents and continuing to make drugs even after patents run out, like Bayer aspirin. They'd be stupid not to, but that doesn't mean they are considered generic drug makers.

Just for clarification.

[SpicyMcVoodoo]

Originally Posted by 6SpeedTA95

Generic drug makers aren't forced out of the market, btw pfizer and merck are also generic drug makers.

I'm saying that during the patent period, generic drug makers cannot sell generic versions of whatever drug is still under patent. What do you mean generics aren't forced out?

[SpicyMcVoodoo]

Originally Posted by hsmith