SUMMARY: The American healthcare system gives drug companies enormous powers to dictate prices through arguments that aren’t relevant anymore. In addition, pharma companies have become experts at playing the patent game to keep profits flowing from big-name drugs.
At a meeting to talk about the launch of a drug later this year an intern from Harvard’s MBA program gave a presentation on pricing. In one of her slides she two circles, one indicted a pricing strategy to maximize profit the other indicated the availability of this drug (cancer treatment) to patients based on price. The circle with the highest profit had a lot of data points outside to indicate that many patients would not be able to pay for the medication while the other circle had more data points inside but clearly showed that profit would not be maximized. Can you guess which strategy was chosen?
In the lobbies of most pharma companies there are slogans about “serving patients” but by now those words are hollow. A new report by UBS, an investment bank, finds that Americans spent nearly two-thirds of all money spent globally on new drugs from 2012 to 2017. On June 14th Bluebird Bio unveiled a gene therapy to treat an inherited blood disorder that will cost nearly $1.8m per treatment. Shortly before, Novartis, a Swiss giant, priced its gene therapy for spinal muscular atrophy at $2.1m, making it the world’s most expensive medication.
It’s time to admit the truth
1ne: Pharma companies will do whatever it takes to please Wall Street.
2wo: Too many pharma CEO’s are compensated on stock prices of their companies.
3hree: Pharma has pretty much turned a deaf ear to, what they consider, the noise around prices.
4our: PhRMA is nothing but propaganda and will support anything that allows pharma to maximize profits.
Yes, we are living longer because of the drugs that pharma companies produce but at the same time emergency medical bill for thousands of dollars could be a struggle for people who have high deductible health insurance and steady incomes. 66.5% of all bankruptcies are related to medical issues, either because of expensive medical bills or time away from work.
Our work doesn’t matter when we become silent about thing that really matter to the people we serve.