Good (IMO) editorial from David Frum

[Malthus]

Obviously, tyhere is a role for private research, but the notion that Americans (or anyone) has to pay absurdly inflated drug prices to fund it, and that the whole world is beholden to Americans selflessly paying,  is a mirage. I can understand why this mythology would ease the pain of being had by the drug companies, but there is no reason for intelligent peopole to buy into it.

Are you arriving at this conclusion based on the evidence, such as an examination of pharmaceutical volumes sold in Canada that were researched using private vs. public funds, or from first principles?

I'd welcome solid evidence in terms of numbers either way. The problem is that such numbers are hard to get. The reason is that drug companies lump spending to 'research' that is really better termed 'product promotion and patent prolongation'.

What I know, is the use that drug companies make of research money - because that's part of what I do, business-wise; I know the situation here in Canada and in the US.

I can explain how it works but obviously I can't put actual numbers to it, without doing a study.

[Berkut]

Hell, you still see that here in the US.

My wifes sister was diagnosed recently with breast cancer. Her doctor sent her to a specialist of course, who decided she needed surgery. Which is fine, I am sure the specialist knows what they are doing.

However, my wife's mom had also had breast cancer, and it happens that she was and is being treated at the best cancer treatment hospital in the region, and happens to have one of the leading experts in breast cancer treatment as her doctor. Normally this guy is nearly impossible to see - he is the best, after all. Well, since he treated her mother, he would be willing to consult with the sister and go over her options.

Sister actually refused to get this second opinion at first, because she thought it might be kind of rude to her first doctor. WTF? You are dealing with a potentially deadly disease, and you are worried about being rude to your doctor by consulting with someone who is the acknowledged best in their field? My wife told her she was being ridiculous and it would be foolish to not at least see what super-doc has to say about her options and her current doctors treatment plan. So she is going to see him in a couple days.

But it is rather odd how ingrained it is in many people to NOT question their doctors.

[Malthus]

This is probably true to an extent; but advertising is probably not the best or even the major source for patient involvement these days - there are tons of resources on the 'net.

The reality is that companies advertise because it sells their products. In the case of prescription drugs, this can only come about as a result of patients pressuring physicians to prescribe where they would not otherwise - meaning over-medication, or switching from one brand to another. Resources devoted to over-medication or brand-switching are essentially resources thrown away in terms of public benefit; drug companies can charge less in jurisdictions with strict advertising controlls and still make a profit, in part because they do not carry the cost of this type of competition among themselves.

It is the problem of having a competitive system with a "learned intermediary" who is supposed to actually make the decision.

Obviously that is why anyone advertises - that doesn't mean that their can't be secondary benefits.  You might not be inclined to look certain things up if you don't know they exist. 

Besides, how exciting is DTC advertising? It typically shows some happy individual enjoying life, the product name, a long scary list of side effects and then often nary a mention of what the product is actually for.  Seems a bit overblown to suggest that those ads cause physicians to beat down their physicians until they give them what they saw in the advertisement.

How exciting? Obviously, exciting enough to spend millions of dollars on it. Companies don't pay for ads that don't work - and the *only* way these ads work, is in ways that are not condusive to the good of the public.

I would not deny that there are secondary benefits. But they are not the reason for the ads.

[garbon]

How exciting? Obviously, exciting enough to spend millions of dollars on it. Companies don't pay for ads that don't work - and the *only* way these ads work, is in ways that are not condusive to the good of the public.

I would not deny that there are secondary benefits. But they are not the reason for the ads.

Certainly but then are the doctors folding because their patients threaten to leave or because medication y isn't so different from medication x and so if the patient expresses a preference, why not try it?  After all when I first when on depression meds, I was given a few choices.  I eventually fought for Lexapro after the provided choices, at different physicians, proved insufficient.

Secondly, who cares why they are doing it if they are doing it? Biotech companies don't produce new drugs mainly for the reason of helping humanity - they want to make a profit. Nevertheless I'm really happy that they do, as there are "secondary benefits."

[garbon]

Relevant ppt posted on the FDA's site. Although sadly yes, it cites research more than a decade old.

www.fda.gov/downloads/AboutFDA/CentersOffices/CDER/ucm095993.ppt

[Admiral Yi]

I'd welcome solid evidence in terms of numbers either way. The problem is that such numbers are hard to get. The reason is that drug companies lump spending to 'research' that is really better termed 'product promotion and patent prolongation'.

What I know, is the use that drug companies make of research money - because that's part of what I do, business-wise; I know the situation here in Canada and in the US.

I can explain how it works but obviously I can't put actual numbers to it, without doing a study.

You're talking as if demonstrating that pharmaceutical companies spend money on aspects of business promotion that are not directly tied to researching new drugs demonstrates the ROTW is not free riding on US R&D.  It does not.  In order to prove your assertion you would need to show that (most? all?) of the drugs people are consuming around the world were developed in a "system" other than the one which relies on charging US customers monopoly prices to amortize private research costs.

[Neil]

You could also reform your tort law and place "actual financial loss" cap on damages for medical errors (excepting stuff like wilful misconduct) and do away with "moral damage" claims. But I can see why you would find this option unmentionable, counsellor.

Many states are doing this now.  But then you run into the problem of caring for someone who is totally disabled by medical malpractice.  Those damages fall under 'non-economic damages', and are thus capped.  When you're dealing with the costs of caring for, say, a severely retarded child for the rest of their life, the caps are often somewhat inadequate.

[DGuller]

  Let me hazard a guess.  Minksy has clients in the pharmaceutical industry.  Malthus does not.

[Barrister]

Other countries control health care costs by putting price controls on pharmaceuticals.  Then they free ride on the research and development that gets done out of the profits earned on the back of the US consumers who pay (relatively) uncontrolled prices.  Frum buries this and instead talks about unspecified "waste" which sets off the automatic B.S. alarm.

You could also reform your tort law and place "actual financial loss" cap on damages for medical errors (excepting stuff like wilful misconduct) and do away with "moral damage" claims. But I can see why you would find this option unmentionable, counsellor.

In this country, "moral damage" claims are fairly small.

Where you get to exorbitant damage awards are where you can spin up a huge "actual financial loss" claim.  Loss of future earnings is usually the biggest one - imagine what an injured child might earn over the course of their entire lifetime, adjusted for inflation, and you'll see what I mean.

[Martinus]

Other countries control health care costs by putting price controls on pharmaceuticals.  Then they free ride on the research and development that gets done out of the profits earned on the back of the US consumers who pay (relatively) uncontrolled prices.  Frum buries this and instead talks about unspecified "waste" which sets off the automatic B.S. alarm.

You could also reform your tort law and place "actual financial loss" cap on damages for medical errors (excepting stuff like wilful misconduct) and do away with "moral damage" claims. But I can see why you would find this option unmentionable, counsellor.

In this country, "moral damage" claims are fairly small.

Where you get to exorbitant damage awards are where you can spin up a huge "actual financial loss" claim.  Loss of future earnings is usually the biggest one - imagine what an injured child might earn over the course of their entire lifetime, adjusted for inflation, and you'll see what I mean.

Under Polish law, you only count future earnings based on actual, not hypothetical, income and qualifications prior to the accident. So a child would probably not qualify for anything.

The way it works, you usually get the following costs:
- costs of medical treatment,
- costs of ongoing medical care/treatment, and
- "decrease in quality of life" (which involves some element of lost income, but to a limited degree only and is more about giving you money necessary to survive at an average level to the extent you are unable to make money on your own).

What I guess also differs under Polish law is that, as a rule, you are given a pension/period payment rather than a lump sum on anything that is not an immediate out of pocket expense.

[Malthus]

I'd welcome solid evidence in terms of numbers either way. The problem is that such numbers are hard to get. The reason is that drug companies lump spending to 'research' that is really better termed 'product promotion and patent prolongation'.

What I know, is the use that drug companies make of research money - because that's part of what I do, business-wise; I know the situation here in Canada and in the US.

I can explain how it works but obviously I can't put actual numbers to it, without doing a study.

You're talking as if demonstrating that pharmaceutical companies spend money on aspects of business promotion that are not directly tied to researching new drugs demonstrates the ROTW is not free riding on US R&D.  It does not.  In order to prove your assertion you would need to show that (most? all?) of the drugs people are consuming around the world were developed in a "system" other than the one which relies on charging US customers monopoly prices to amortize private research costs.

Just to clarify a few points:

- in every jurisdiction, not just the US, drug manufacturers enjoy patent monopoly. The issue is controlls on price and advertising, not existence of monopoly.

- the issue of "free riding" is whether the US manufacturers spend a disproportionate per-population amount on research that actually benefits people by developing beneficial new drugs. Obviously, no matter what systems are involved, the US as a rich and gigantic market, would pull a lot of weight. The issue is whether it pulls above its weight because of its unique system.

- To determine this, it is necessary to determine what portion of US company's reserach budget is actually spent on beneficial research.

[Martinus]

Yeah, I am not sure I understand the patent monopoly argument. Is the patent monopoly period longer in the US than in other Western countries?

[Malthus]

Let me hazard a guess.  Minksy has clients in the pharmaceutical industry.  Malthus does not.

I dunno who Minsky's clients are, but I do a lot of work for the pharma industry. Innovative-side, not generic-side.

[The Brain]

The US is still piggybacking on German medical research in the 1933-45 era.

[Martinus]

The US is still piggybacking on German medical research in the 1933-45 era.