"We shouldn’t fear the price tag of these new medicines," says Pitts. "Expensive medicine may be a bitter pill, but these advanced therapies offer hope to millions of patients, keeping them healthier for longer."Unfortunately, the numbers Pitts cites in defense of that statement suggests the opposite.
Pitts says that the cost to bring a new drug to market – "from the time it is a twinkle in a scientist’s eye, through a decade or more of lab research, to clinical trials and finally FDA approval" – is $1.2 billion. This, according to Pitts, justifies the prices of the most expensive medications, including four biopharmaceuticals approved in 2012 that cost more than $200,000 per year, per patient.
At $200,000 per patient-year, a drug company can recoup the development cost by treating 6,000 patients in just one year! A far cry from offering "hope to millions of patients!"
Even with insurance paying for the bulk of such treatments, only the rich can afford the co-pays for these drugs that "our children and grandchildren will grow up to marvel," according to Pitts. Marvel, indeed.
Agreed...why in the world would Pitts publish this piece here? Oh, let me guess. Because it's fluff. I saw you asked in the comments of The Buffalo News where he got those two studies. I replied there, and here it is again: Probably these two studies (IMS and Express Scripts) cited in this NYT article: http://www.nytimes.com/2013/03/19/business/use-of-generics-produces-an-unusual-drop-in-drug-spending.html?pagewanted=all&_r=0
ReplyDeleteIt's probably the Tufts study that estimated the $1.2B in drug development costs (in 2005 dollars), oft cited by PhRMA: http://csdd.tufts.edu/about/history
However, I think there is another pretty interesting article in Forbes that shows some other analyses on R&D spending, time to profit, etc. Read this: http://www.forbes.com/sites/matthewherper/2012/02/10/the-truly-staggering-cost-of-inventing-new-drugs/
IMS expects the % of Rxs dispensed as generics has maxed out at around 85-87% of total Rxs...and we'll hit that momentarily. After that, prices will significantly rise again, just as they have for decades.
I'm not sure if the bowels of the IMS study evaluate the impact of the recession on drug costs taking a minor 1% dip in 2012...but I suspect the number of Rxs left on the shelf at the pharmacy, or the # of Rxs never even taken to the pharmacy have an inverse relationship with costs. If anyone has seen these data, perhaps you'd share.
Another thing I'd be interested in is the associated costs for handling specialty pharmaceuticals...cold chain management, supplies, etc etc.