US Drug Prices
The cluster focuses on debates about exorbitant prescription drug prices in the US, including factors like insurance negotiations, lack of government price controls, pharmacy benefit managers, and examples such as Martin Shkreli's price hikes on existing drugs and rising costs of insulin and EpiPens.
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It could be because the government is not allowed to negotiate drug prices. (Medicare.) They pay whatever the drug companies ask.Or, maybe because most individuals in the U.S. don't pay the full price. They pay a 'co-pay.' Insurance companies pay the rest. But, they can only make profit as a percentage of revenue. If they lower drug costs significantly, they significantly lower their potential profits. Why would they do that? From a shareholder's perspective, that's a
Not trying to be rude but he already told you the answer. You really should look up 340b. It's a federal program to rebate drug costs for certain types of patients and is a legal form of price discrimination. When you provide a drug in a healthcare setting, it can be a very different price depending on who receives it, because the federal government has the 340b program.Your argument about cost to manufacture isn't relevant in the same way that the marginal cost of a flying one more
It's expensive because doctors are using it to make a lot of money. The drug is cheap.
> The first pig could be like Martin Shkreli, pricing necessities beyond the reach of people who need them.Source? Who was unable to buy the medicine? According to him IIRC about 60% of the drug is given for 1$ or some nominal. Also, most people's insurance buys it.
Maybe buying up life-critical drugs to hike up the prices?
Pharmaceutical companies in the US charge whatever they can get away with, with the argument that insurance will cover it for most people. The price of insulin (clearly not a new drug) has increased 10x in the last 15 years.
The price of the drugs is amortized over everyone with insurance. The drug in question has a total potential audience of around 2000 people in the United States, if I remember correctly, so that means the cost of the treatment will be spread very widely.Also, the drug he raised the price on was a horrible 50-year-old drug. Shkreli raised the price with the explicit aim of getting funds to research a new drug, with less terrible side-effects.
You are mistaking list prices with cost. Nobody pays list price. List price is an anchor for price negotiation. This works against you as an uninsured individual, because you have no negotiating power. Insurance companies act as the wholesaler and they insist on locking you into a complicated subscription model. They can only do this because drug purchases are heavily regulated.
It is possible that both can be true. The price for medicine is cheaper because you have a single entity, the NHS, negotiating for a large group of people. On the the other hand, it is possible that we subsidize the development of new medicine to an extent. An epipen would otherwise exist regardless because it is a requirement for many people. More advanced medicine that requires a large capital investment for research and development could be another story.
Prescription medication can be extremely expensive without good (expensive) health insurance, especially if there is no "generic brand" version of the drug available. Think hundreds of dollars per refill. I think that's the pain point they're trying to solve.