That Guy Who Price-Gouged AIDS Patients Did It to Kids with Kidney Disease

[Baron von Schtinkenbutt]

Is there any evidence that this has actually happened in this case?

Not as yet.

Are you sure you can't base the effiacy trial from an approved European producer?

My understanding of the bioequivalence trial requirements is that if the source is not FDA-approved, it doesn't count.  My understanding of the import regulations is that an FDA-approved foreign manufacturer is free to sell drugs to US distributors.  Thus, if there were already FDA-approved European suppliers Turing wouldn't have a sole-source position to begin with.

The drug was available via wholesale distribution for decades (until 9/11/2015) and no other pharmaceutical companies opted to go through the regulatory burden of obtaining the ability to produce this unprofitable drug. Let's kill all of the lawyers and lower the barrier to entry so that we don't end up forcing the single remaning manufacturer to act as a charity.

Understandable, but the previous de facto monopoly holder was not trying to abuse the position; the new one is.  In fact, I could ask you why GSK was selling the drug for so many years at an unprofitable price point, if it really was so terribly cheap to begin with.

[Ideologue]

It isn't, but I imagine you think a comparison of two countries, one of which has less than 1/10th the people and is devoid of the established infrastructure built up over a century of pharmaceutical research, is a good one?

You should imagine I think Canada should produce 1/10 the new drugs the US does, everything else being equal.

I tend to see the absence of "established infrastructure" support for my point.  In the absence of a profit motive the tendency will be to free ride.

The US became a center of pharma research.  Why?  I don't know, although I doubt it had a lot to do with major differences between America and Canada circa 1920.  Meanwhile, you might as well wonder why Canada never developed, say, a massive steel export industry, or a major aircraft industry, or a Hollywood.  The answer is other trading partners were first to develop those, and Canadians generally focused on what they could be best.

[crazy canuck]

The US became a center of pharma research.  Why?  I don't know, although I doubt it had a lot to do with major differences between America and Canada circa 1920.  Meanwhile, you might as well wonder why Canada never developed, say, a massive steel export industry, or a major aircraft industry, or a Hollywood.  The answer is other trading partners were first to develop those, and Canadians generally focused on what they could be best.

The answer is actually pretty simple. And you are correct. Canadian politicians of the day thought that creating a branch plant economy closely connected with the US would be the most beneficial model.  Not so much these days.  But that is the historical explanation.

[Ideologue]

It isn't, but I imagine you think a comparison of two countries, one of which has less than 1/10th the people and is devoid of the established infrastructure built up over a century of pharmaceutical research, is a good one?

You should imagine I think Canada should produce 1/10 the new drugs the US does, everything else being equal.

I tend to see the absence of "established infrastructure" support for my point.  In the absence of a profit motive the tendency will be to free ride.

Once again, pharma is for-profit in Canada.

It's probably why it's so small and devoid of innovation.

[crazy canuck]

It isn't, but I imagine you think a comparison of two countries, one of which has less than 1/10th the people and is devoid of the established infrastructure built up over a century of pharmaceutical research, is a good one?

You should imagine I think Canada should produce 1/10 the new drugs the US does, everything else being equal.

I tend to see the absence of "established infrastructure" support for my point.  In the absence of a profit motive the tendency will be to free ride.

Once again, pharma is for-profit in Canada.

It's probably why it's so small and devoid of innovation.

Some of it develops first within our public university system first so that ought to make you happy.

[Ideologue]

[Malthus]

Patented drug prices are subject to a price control mechanism. However, in reality, this mechanism has less and less relevance to actual drug pricing, because a large part of the market is covered by public insurance reimbursement - and the public insurers use their awesome bargaining power to muscle companies into giving them big discounts.

Which just means there is a lot of free ridership off of markets like the US where companies stand to make sizable profits.

After all, if all markets were like the UK - there would certainly be little incentive to be quick to innovate in say the biologic space given that the NHS wasn't really too keen on footing the bill until much cheaper biosimilars became available.

The markets in the US are different in a bunch of ways from Canada, but it has nothing to do with "free riders".  The public insurers for the larger provinces are just bigger than most private insurers, and thus able to get better prices because they can deliver volume.

That's how the markets work anywhere.

Private insurers are clamoring for rebates, too, but at least in Canada they lack the muscle to obtain them from manufacturers. Instead, the private insurers are turning on pharmacies - by putting together "preferred provider networks" whereby pharmacy chains agree to giving the insurers a slice in return for reimbursement exclusivity on high-priced drugs.

[Admiral Yi]

The markets in the US are different in a bunch of ways from Canada, but it has nothing to do with "free riders". 

It has everything to do with free riding.

Either Canadian drug consumers are helping to amortize the R&D costs of new drugs or they're free riding on the people that are, in this case American consumers.

[Razgovory]

Really we need to stop free riding on the concept of "agriculture" and give the Middle East their due.

[viper37]

Pharma should be a state industry, so that's not much of an objection.

I believe it is in Canada.  We probably can't hope to match their prodigious output of world-changing drugs though.

Some provinces (Quebec at least, unsure about the others) have a "drug insurance" where the government will act as an insurer for people who can not/don't want to get a private insurance that covers medications.

And lots of drugs have been developped in Canada, but the pace has slowed lately, since big pharmas are moving their operations to socialist shitholes that gives them tons of $$ in subsidies.  Like various US States, for example.

[Syt]

http://www.iflscience.com/health-and-medicine/rival-company-offers-1-alternative-pill-martin-shkreli-s-750-hiv-medication

Rival Company Offers $1 Alternative Pill To Martin Shkreli's $750 HIV Medication

The man who raised the price of a common drug for HIV patients by 5,455% might be having some karma on his way after a rival company has vowed to make a $1 alternative of the same medication.

Last month, 32-year-old Martin Shkreli spent his 15 minutes of fame being the most hated man in America for upping the price of the life-saving medicine Daraprim from $13.50 to $750 per pill. Thanks to the absence of price caps on medicine in the United States, this meant Shrekli's company, Turing Pharmaceuticals, was able to increase the cost of the medicine after purchasing its manufacturing rights.

However, San Diego-based Imprimis Pharmaceuticals Inc said on Thursday it will soon be offering customized versions of the medicine in the form of an oral capsule for less than $1 a pill.

Both medicines treat toxoplasmosis, a parasitic disease that commonly affects people with weakened immune systems, such as those with AIDS. The newer, cheaper pill will use formulations of the active ingredients pyrimethamine and leucovorin customized to the patient's needs. However, unlike Daraprim, the Imprimis medication will not be FDA approved.

In a statement, Mark L. Baum, CEO of Imprimis, said, "It is indisputable that generic drug prices have soared recently. While we have seen an increase in costs associated with regulatory compliance, recent generic drug price increases have made us concerned and caused us to take positive action to address an opportunity to help a needy patient population."

He also added: "We are here to serve our patients and their physicians. We believe that when we do a great job serving our customers, our shareholders will also benefit."

Shkreli did an AMA on Reddit this weekend where he faced questions on the price hike and the ensuing global backlash.

US Uncut attempted to get a comment from Shkreli on the development. His response was "lol."

[Jacob]

The markets in the US are different in a bunch of ways from Canada, but it has nothing to do with "free riders". 

It has everything to do with free riding.

Either Canadian drug consumers are helping to amortize the R&D costs of new drugs or they're free riding on the people that are, in this case American consumers.

Alternately, the excess costs in the US have little to do with R&D and everything to do with marketing and legal costs.

[crazy canuck]

The markets in the US are different in a bunch of ways from Canada, but it has nothing to do with "free riders". 

It has everything to do with free riding.

Either Canadian drug consumers are helping to amortize the R&D costs of new drugs or they're free riding on the people that are, in this case American consumers.

Alternately, the excess costs in the US have little to do with R&D and everything to do with marketing and legal costs.

And profit.  At least that was the sole motivation for this recent price gouging.  Now Yi et al will say that is fine.  But they shouldn't hide behind R&D.

[The Brain]

Maybe he is Chaotic Evil?

[grumbler]

The markets in the US are different in a bunch of ways from Canada, but it has nothing to do with "free riders". 

Assertions are not arguments.

Economics would say that the drug companies are willing to sell to secondary markets like the Canadian market at any price that doesn't exceed marginal cost, if they can make their primary market pay more than average total cost.  That is the "free rider" problem.

Now, the free rider problem may not exist in this case, but it cannot be dismissed just because