Making Drugs Cheaper Without Stifling Innovation -- Euro Style
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- Опубліковано 28 сер 2016
- Can we keep drug prices low without hurting innovation? Well, drugs are a lot cheaper in Europe than in the US, and there's still plenty of innovation over there. So what's going on? It's called reference pricing, and it's pretty much genius.
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This is a story I tell too often. I have asthma, I use symbacorte. There is no generic in the U.S. I buy foracort, a generic made overseas, from a pharmacy in Canada. Symbacort in the U.S is between $350 and $399 for a 30 day supply. Foracort, mail order from Canada is $99 for a three month supply.. This is not insane. It is obscene.
And US pharm companies are currently lobbying against the importation of drugs from Canada (and the world). I hope our politicians have the courage to stand against this.
As long as we get press and media exposing the most egregious of these lobbying measures and as long as people are not made aware of the price differences (and patent differences) things will stay pretty status quo. Medicare will be banned from bargaining for prices, people like me with internet resources and experience living in and dealing with European countries will pay a vastly less reasonable price than less experienced and resourced people.
Symbacort is not one drug, but two: a steroid and a bronchodilator. There are other options for the steroid, including Advair. I haven't researched the bronchodilator. The point is, you may be able to get something even cheaper if you don't buy the combo drug.
It will actually work better, as both drugs can be tailored to actual symptoms. In fact, combo drugs are actively discouraged in both medical and pharmacy schools.
I don't know of any research that shows that a combo dosage form is better than taking two drugs individually, though my knowledge base is certainly limited. But you are certainly correct, that drug companies know they can make more from a combo dosage form than two separate doses.
Really, the point is that the patient will take a more expensive combo drug rather than two separate drugs because the patient doesn't pay any more for the combo. If the patient wants a cheaper drug, s/he needs to specifically ask the Dr., who must then be willing to figure out a cheaper regimen. These conditions rarely arise.
Why are there so many "trolls" on this page? It is a good and informative site wherein the content producer seems to comply with the established rules of scientific inquirey and to understand statistical analysis. Who is so afraid of this content that they have to post obscenities here?
It's the Internet. There are always trolls. It doesn't mean anyone is afraid of this forbidden knowledge or paid to be trolls.
Hooray for my home province of British Columbia supporting affordable drugs!
how much would an average prescription be in Canada
script of what? Champix is 102 dollars a month. 26 dollars for cipro. for a 1 day supply
+caliph20 meanwhile in the UK...maximum price for unlimited items on a prescription: £10 ($13/15) regardless of the amount of pills or types of drugs
dilydan I though it was £8 per prescription item? I've never actually had more than 1 item per prescription so wouldn't know.
It's capped at £8.40 per item. In practice pharmacies, if provided with a multi-item prescription to fill, will charge £8.40 for the entire prescription regardless of the number of items. There are some, though few and far between, who will charge per item but this is incredibly rare.
Some healthcare innovations are also majority funded by the state yet somehow still gets marked up to the tax payers who pay for them.
The trouble with this line of argumentation is that it opens the door to socialized everything. Taxpayers pay for roads and bridges, they pay for courts and police, they pay for the military that protects our shores and enables the peaceful functioning of the market. Taxpayers subsidize K-12 education and enormous amounts of post-secondary education. They provide research funding domestically and internationally. Taxpayers fund the departments charged with keeping our air and rivers clean.
In summary, nothing is yours alone and so none of the profits are rightfully yours. This is an increasingly common opinion, but I think a look at history shows it's short-sighted. Of course, the logic is sound, so if you want to avoid the awkward state of affairs where public funding is used for private profits, the answer is to end public funding. We know how things end when private profits are outlawed.
I live in one of the countries you mentioned (Germany) and just ran into a problem with this system. The new anti-depressant I tried out is no longer on the market here because the company wouldn't settle for the price of comparable products. Which sucks at the moment because it seems the medication wasn't effective only for me but also for other people who have already tried the alternative medicines without much success. Of course, this is just one medication, and I guess you could import it for a higher price if the insurance company/your wallet agrees, but it seems to me that this could be the beginning of companies fighting back and holding patients' health hostage.
Depression sucks man. I have Bipolar so I'm well aware. My advice, while you're waiting for some new kind of medication, would be to regularly visit your friends and family, especially if they have a dog.
The United States could definitely take a page out of Europe’s book. They have chosen to use a procedure called reference pricing that prices the pharmaceutical drugs based on many different things and it is pretty smart. People are unaware that they are being charged an obscene price for their needed medications. In Europe they divide the drugs into different classes and the customer has a choice to spend more on the drugs but it is up to them. The new drugs that are newly created are first put into the higher classes but will eventually be priced down so that the patients can afford to use them, thus increasing the use of the new drugs from more patients. The also chose to price their drugs based on the drugs’ effectiveness and not the condition of the drug. The do not think that a generally effective pharmaceutical medication should be charged a flat rate and if the customers want more they can pay out of pocket for that. I believe that our ridiculously high prices of our newest and most well-known drugs are only prices this high because we are told we have to pay that much. There are many people who chose to go without a certain medication because they simply cannot afford to use it. The inability to afford a needed medication should not be an issue that people have to worry about. The United States should begin to find a way that they can lower the prices of medications to better accommodate the people who need them.
Reference pricing assumes that there is no difference in effect of each drug. Theoretically, mesalazine is mesalazine, but some patients may not get on with Mezavent, but do get on with Pentasa (two different preparations of the same drug). They would then need to pay extra for Pentasa, but only as the alternative is ineffective or intolerable.
Also, some doctors may preferentially prescribe Asacol (another mesalazine) as it is the one they have most experience with. Patients can not be expected to then select a different medication because it is cheaper, as it would not be concordant with their doctor's advice.
Thoughts?
I think you're very much correct. Perhaps I don't understand reference pricing fully, but it sounds very much like the sort of pricing that insurance companies have been doing for decades: generics are covered more fully than brand medications. This results in complications for some patients that do not tolerate the generic well.
Reference pricing sounds like it simply uses broader categories. If it worked as effectively as +Healthcare Triage suggests, I imagine insurers would immediately jump on it. Of course, people don't like it when insurers implement cost control measures.
I wonder if this video would have as many "likes" as it does if reference pricing were being suggested by an insurer rather than as a government plan.
Why is this not something in the United States? This reference pricing could revolutionize the prices of many brand drugs as well as make a set price for average everyday drugs. Not only that it also allow other drug companies to still set their own prices if they so choose too. Placing drugs into their type of classes based on their active agent. The ideal that life is more important than drugs so relay people to this ideal. Looking not many people have jobs or are injured and cannot work to obtain the money required to purchase certain drugs but this might allow them to. Also, I am curious about if this will affect other places in where prices are outrageous such as gas prices or others like it? Making a universal price could lead to many new advancements in medication and amount of money paid for a specific drug dramatically.
Thanks, this helped me understand this complex issue a lot more!
I think one of the strongest arguments in terms of affordable prescriptions would be a ban on unnecessary price gouging on inelastic goods, such as life-saving medications, arrestive medications, and the like. This could be a direct ban, or it could come in the form of state-supported wrongful death lawsuit pursuit. In cases wherein a drug was priced far outside of market value, a strong incentive could be created to drop the price down to safe levels if the District Attorney's office began pursuing wrongful death lawsuits against pharmaceutical companies that overprice their drugs, especially in cases where the drug could have saved a life, could have significantly increased the quality of life during the time remaining, or could have increased a remaining lifespan by over a month or so. Payouts on these lawsuits could reflect the remainder of life involved as regards economic value(Yes, there is one), as well as value to a family, such as income lost by prolonged illness due to costs being too high to treat, or income and time lost due to having to care for a loved one during a similar time.
The incentive could also be created by pitting businesses against one another. For instance, establishing a system wherein life insurance providers would be required, even in cases of outside forces acting on the death of an individual, to pay out in full the amount of the plan to the next of kin, but also creating a system wherein life insurance could more easily legally pursue the responsible parties, could easily create a system wherein pharmaceutical companies would either reduce costs, or find more ways to deliver low-cost vouchers or waive the cost of prescriptions for individuals at or below 4 times the poverty line, simply out of fear that a rash of wrongful deaths due to cost could easily result in dozens of lengthy lawsuits that could, even if they weren't won outright, cost the company millions.
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This is interesting, but it's not going to happen anytime soon. There are so many things we could do in the US, but don't. Also, can you make an episode on end-of-life care's out-of-control costs?
Wow something useful from you. Shocking! I can't belive I'm thumbs upping you.
Jachim Soyer
I'm pretty sure a lot of my other comments have been useful. I've been watching healthcare triage since episode one. There is no way you can conclude that all of my comments are useless.
Offensive? Fuck yeah. Useless? No.
Benjamin Franklin
Sweetie, I love you, but I can defend myself. :P
Nonetheless, I have made plenty of more academic comments. I'm a loser.
Benjamin Franklin
Okay.
Benjamin Franklin
I told you I was doing yoga. :D
It's true, that the prices in Germany are lower than in the US. Nevertheless this system has it's own downsides. There are only a few drugs that require no additional payment by the customer. It also often happens, that the cheap drugs are out of stock, because there's a high demand for these brands. In addition to that your health insurance has contracts with the pharmaceutical companies, that change up to several times a year, that predetermine which 1-3 different brands the customer would get. As a result the customer has to switch brands regulaly. In addition to that these contracts are not necessarily with the cheapest brands. (In the last months a few drugs were excluded from this regulation, because switching brands might affect the even drug level in your body.)
The costs for healthcare increases and the insurance companies try to lower their expenses constanly. Sadly it's usually on the cost of the customer or the pharmacy, rarely at the cost of the pharmaceutical companies. Not every company does excessive research or innovation.
Alltogether the German healthcare system is an enormous construct of regulations and paperwork with it's own upsides and downsides.
I think this misrepresents EU standard models for pharma pricing quite considerably. The largest economies in Europe heavily subsidise personal pharmaceutical costs for one; even at USA standard prices. It also seems to neglect the need for a diversity of heavily subsidised pharmaceuticals with differing properties, pharmacokinetics, and vectors of administration for the same conditions in order to provide better tailored treatment regimes for individuals. I think that the greatest difference between the USA and other countries with regards to pharmaceuticals is that there is government funding for necessary but unprofitable research in Europe, but pharma research is left entirely to the market in the USA.
Thank you for your podcasts, one criticism is that although I think is a great way for cost savings from the third party payer point of view, codifying into law will bring the problems associated with price controls and government regulated markets, meaning shortages of the medications that are underpriced when grouped together... remember that even though medications might have the same pharmaceutical principal, people switch to other medication for other reasons than economic incentives, for example, allergic reactions, different pharmacodynamics. The other problem will be who makes the decision in government of grouping the medications and what counts as an innovation, corruption, kickbacks regulatory capture, and monopoly are all the usual results when one agency, let's say the FDA decides how all third payers should deal with pharma ... great idea as long as is not mandated to all third party payers.
This is the main reason I'm avoiding moving to US.
The CEO of Mylan, producers of the EpiPen, responded to the criticisms of high pricing in the US. She basically said that higher prices, in the US, was subsidizing lower costs in Europe and Canada. While is sounds like she's trying to divert the blame, is there any truth in this?
Of course there is. It's a common practice called price discrimination (or differential pricing): charge different people different amounts based on their willingness and ability to pay in order to maximize profit. Drugs, textbooks, and who knows what else are always cheaper in poorer countries. Drugs sold in Africa might make only a small profit over production costs, while the same thing sold in the US has a massive markup to cover the millions of dollars of R&D costs that the company incurred while creating the drug.
It's important to note, however, that the company isn't LOSING money by selling drugs at a lower price elsewhere. They're just relying more heavily on rich countries for their profit. Nobody in Bumfukistan is going to pay $50 for a few pills, and it's better to make a little money than none at all. If the pills cost $2 to make once they're invented, the company might charge Bumfukistanians $3.
Presumably, reforms suggested in this video would lower the amount Americans are willing to pay for drugs and bring us more in line with other countries. We'd still be rich, but less willing to waste money.
Other extremely common examples examples of differential pricing are student/military/senior discounts and coupons/sales (charge the housewife or retiree who takes the time to bargain-hunt less than the busy businessperson who buys what they can when they need to). Student discounts have the added benefit of indoctrinating life-long customers at a young age. Any time a company can break its customer base up into separate groups willing to pay different amounts, it stands to make out.
For the Epipen no. The price of them in Canada has increased but more in line with inflation.The fact that they increased it arbitrarily by over 500 percent years after production tells the lie. They have a monopoly position, and are abusing it like all other patent covered drug companies.
@caliph20 The Epipen isn't protected under patents. It's the FDA not approving other companies that is standing in the way of competition.
She (CEO of Mylan) explained a lot in an article in the WSJ recently. Most interestingly, that she is trying to charge insurance companies more, not individuals, so as to capture a higher % of the money available in the healthcare market.
Really interesting. How does this fit in with medication in the United Kingdom? We just pay £8.40 for any prescription regardless of the actual cost, but it's difficult to know what that actual price is (and who's paying it).
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Innovation within a class would be stifled as new techniques require higher costs. Take as an example gel capsule vs powder capsule they would be in the same class, but have different outcomes. Innovation within a class then becomes only focused on cost reduction, not fractional improvement.
As noted in other comments, patients who are not 'standard' such as those with drug interactions, allergies, or other needs for alternative formulations are penalized by class pricing policies. Perhaps each class could have 2 costs: one reference cost for the standard formulation and one alternate reference cost for the 'non-standard' patients who have to deal with drug interactions, allergies, etc.
Lastly, what defines a new class would needs to be be carefully legislated or else legal challenges to the system would be quite common, costly, and result in prior levels of inefficiency.
Good comment.
How is this significantly worse for individual or group outcomes to a non price incentivised system? The new expensive drugs will still be expensive and the other drugs will be more expensive. Saying some people won't benefit as much only means the system is less than perfect not failing to be a significant improvement overall and no worse in almost all cases.
It should be noted that the countries involved use reference pricing for a single payer prescription scheme like your Medicaid except they can negotiate the price they pay with drug manufacturers or publish pricing advisory guides for insurance companies. Australia has the PBS which operates in a somewhat similar way.
Your right. The proposed changes are a vast improvement over the current system.
TLDR: However, the class system isn't perfect either.
Full Rant: At present a physician (or other medical provider) can look at two drugs and their patient then prescribe/recommend a particular drug taking into account the patient's needs. The co-pay will be identical to a patient with-out those additional needs. Under the proposed system the physician prescribes the same drug, but the patient pays more out of pocket for the drug because the drug isn't the cheapest in its class (due to being an unusual formulation). This is an added cost to being 'non-standard,' that, in turn, is 1) unfair, 2) an added burden for those with already high costs (drug interactions, other health issues, etc.), and 3) leads to a monopolist system that identifies 'non-standard' individuals as exceptions and problems. Carving out exceptions is a particularly dangerous road, which has previously lead to ... issues.
Further the class system stifles incremental innovation: Drug A is $1 and 50% effective. Drug B is $2 and 75% effective. Drug A has optimized manufacturing. Drug B is still made in small batches. If Drug B were made industrially, it would cost $0.80, but due to low initial sales (and proprietary information non-disclosure) is never invested in.
Excellent comment. It would definitely be better than the current system, but not taking varying formulations into account is a huge drawback. Intricate formulations cost a lot more to develop and manufacture and often have astounding improvements over the regular formulations, what benefit would there be to the manufacturer/developer if they were in the same pricing class as the less efficient formulation?
Your comment highlights the very foundation of the utilitarian viewpoint in ethics. You point out that a minority of people would not benefit from a change in the current system of pharmaceuticals in this country, while a vast majority would enjoy the benefits of the system change. Utilitarians are only concerned with the good outcome for the majority of people involved. Whether or not this kind of change can be considered ethical by another way of thinking is another discussion. Deontological thinking is more focused on whether or not there is a duty to make a decision. So this could be argued either way. A person may have a duty to change the system to benefit the most people. In this case the system could be changed. However, a person who considers it their duty to only make changes that benefit everyone would not be in favor of making a system that only benefited people with certain qualifications.
Using this type of systems would benefit patients extremely. Grouping drugs by their abilities and pricing them accordingly makes logical sense. In the United States if you are prescribed a medicine that has no generic, it'll cost you much more. Generic medications bring the prices down exponentially but unfortunately not every drug has a generic. Even with insurance these medication can cost an obscene amount of money, and with out of insurance you're lucky if you can afford your medications. This system will even help bring all the prices down over time. Like he said, a company can make their drug cost more but over time they will lose buyers and be forced to lower their price as well. The drug industry makes enough money to lower its price and create a reference price for each classification of drugs. The incentive for creating new drugs will not be lost and more people will be able to afford the medications they need.
My question is..WHY ISN'T THE U.S. USING REFERENCE PRICING? I think the pharmaceutical companies should be more concerned on saving as many patients as they can instead of trying to make the highest profit. The lower cost of drugs makes them more accessible to a more variety of people. Every social class can benefit from cheaper drugs. Many common illnesses can be cured and this will lead to a healthier America. I believe it is a selfish act upon pharmaceutical companies that they would rather profit than have others profit. It is understandable that medicine is a business but overpricing medicine shows poorly on the companies.
We'll move forward when we are free of corporate interests inside of our government, seeking bills and laws that suit their own purposes. That is the reason.
My only concern is based on my experience with birth control. I've tried many different types of oral birthcontrol that would technically fall in the same category but many did not work. The type I am on now is more expensive but I do not experience breakthrough bleeding.
The way it works in my country the insurance covers for the more expensive version if the doctor gives an objective reason for it. In your case it would be history significant undesirable side effects on standard birth control, so you'd have a right to the more expensive option without additional co-pay.
The same goes if you're allergic to something in the cheaper option, have a specific form of disease for which the more expensive option brings significant benefits in contrast to the base standard drug in that category, have pre-existing conditions or prescribed drugs that don't play well with the cheaper option, but work well with a more expensive one, ...
Of course there's no way to see how US would implement it or how your insurance would choose to interpret the law if it were loosely worded.
External Link to "read more" didn't work. It said "Cannot find what you are looking for. Try searching again !"
part of the problem with US drug costs is down to the restrictive patent laws. anyone makes a drug that's even vaguely similar to one already on the market and they have to watch out for costly lawsuits and lobbyists lobbying against their competition.
がに That's the same pretty much everywhere...
Interesting ideas. How do these systems handle people not being able to take the cheapest drug because they are in the "possible side affects" group?
Swede here. The doctor can prescribe medication with those specific restrictions and thus the cheapest drug in the class that they can still take becomes the new default.
I should add that unless the possible side effects are very likely or very bad... they're probably getting the creaper version on trial to see if that will work...
Johan Winqvist I take it drug iterations are handled the same way. for example, Lots of drugs can not be taking while on chemotherapy and alternatives make be quite expensive.
Lucid Moses Not sure I understand the question. Are you asking if long treatments follow the same principles? In that case the answer is yes. Which also means that you might be put on a different brand drugs that has been shown to do the same thing without much notice. Someone just came up with a cheaper way to produce it. Or figured they could make enough money short-term by selling lots cheaply and then use that money to research something to bring in money long-term.
Johan Winqvist I'm wondering more from the end user point of view. For example the most cost effective high blood pressure pills causes bad side affects in people with a specific (uncommon) gene. So they have to use a different drug that is much more costly.
Does the end user have to pay the difference because they are in the same class?
I don't see how that could work in any country with socialized drug systems. Or is this a way of starting down the road of getting rid of socialized drug systems?
The part the system pays for is the cheapest applicable drug. So if you need a different one than most to treat a condition for reasons where tests show the drugs differ - then the expensive one IS the cheapest applicable one.
But the government agency goes through the research to figure out what's different enough to warrant exceptions. There is some leeway for doctors and pharmacists, but patients need to deal with what those have decided on or pay for the difference.
I understand reducing outstandingly high drug costs. But wouldn't lower all drug costs in the US directly affect Europes cost?
In fact isn't it understood that Europeans enjoy low set prices because US citizens pay the true costs that fund the pharmaceutical companies incentives and research?
Can you guys do an episode on generic drugs in India ? @healthcare Triage
This is so cool, however, if the Canadian Province of British Columbia can do it, what's stoping the U.S. states of California, Texas, or New York (among others) from applying this within their own state borders? Their residents could benefit from these better pricing options and U.S. politicians can point out at a domestic version of this skim, so that xenophobic idiots can't say is not possible in the USA, unhindering it in the process for the rest of the U.S. states. As for the version to be used of this pricing skim I kind of like the average pricing option that Germany and Spain follow as well the average can seem fairer to pharmaceutical companies, but the lowest price possible would be awesome to have!
I like the idea of the paying for life gained as opposed to the medication itself. However, because Tarceva is an oral drug, doesn't that already effectively happen? If someone takes a medication on a daily basis for a week and a half wouldn't they pay less for that drug overall than someone who takes it for 3 months? Perhaps it isn't a daily medication, or maybe you're suggesting that each pill itself be less expensive because they are less effective at treating the disease at hand, but it's certainly something to think about.
Thanks! Can you do an episode on therapy/psychiatry?
Watching every week. Cheers.
Regarding drug and medical device pricing, why does no one mention the cost of raw materials? Are they negligible? Consider the following: A pharmaceutical company must have the money to purchase glassware, purchase and maintain GCMS, NMR, and spectroscopic facilities, purchase receptor proteins, synthesize drug candidates, pay pharmaceutical chemists and clinical researchers, and run series of clinical trials. When a researcher needs a bunch of raw chemicals, resins, flasks, enzymes/receptor proteins to assay inhibitors, they get it from some distribution or manufacturer like Sigma-Aldrich. Is it assumed that these manufacturers fall into the pharmaceutical company side of things? Is that aspect out of the control of federal regulation? Look at the issue from where it begins: the chemical manufacturers and technology manufacturers. Can that side of things be managed?
I think I know what Fridays episode will be on....
I don't believe that creating some bureaucracy will reduce prices in the medium or long run. Such bureaucracies simply get captured by interest groups.
However, we need not wait for such a thing, or even create the thing. Right now, insurance companies can spread this kind of information to physicians on their panels. Physicians can, by discussing the issue with their patients, cause the same kind of downward price pressures. Insurance companies have motivation to do this, and would also have motivation to let pharmaceutical companies know they are doing it.
Christian Libertarian
I have a question. Wouldn't the cost difference between the lung cancer patient and the pancreatic cancer patient be naturally controlled because the Panc. Patient would be paying for the drug for a shorter amount of time?
Great vid! Keep up the good work!
Is this used in Switzerland? I live there and meds are pretty expensive to me (like everything here ^^')
finally, this video was long overdue :)
3:43 to "Is better than the existing therapies": pardon my naïveté, but what is the sort of metric being used for the therapies in this proposition to decide which therapy is better? Amazing videos as always, HT.
This is tested in comparative clinical trials.
Double blinded. Usually with at least the old drug(s) and the new drug, sometimes a placebo.
Then a statistical T-test or, depending on the research another statistical method is used to look at the outcomes.
The stuff that is measured can differ from general outcome to certain side effect, how often they occur and/or what the physiolgical effects are (usually in the trials with healthy people and animals).
The metrics can be anything health related, from heartproblems to concentration of certain proteins/chemicals in the blood depending on the med.
They could make a miniseries on this, next to the miniseries on statistic posted earlier on this channel.
I think they should, to succor the less enlightened into some of his relatively advanced videos using clinical trials as evidence. Thanks, helpful!
There's some obvious problems that would have be built in. One, certain people can't take certain drugs due to side effects or allergies. Obviously, if people can claim this to get any drug they want that would defeat the purpose of this system. Still those people exist and we have to consider them. Even now in the US, doctors will yell at insurance companies on the phone who want to pay for the cheaper drug even it could make the patient very sick or even kill them. I personally have been given a drug I had a known allergy to. I'm entirely sure it was because it was a very cheap drug and someone was trying to save money. Two, drugs can have a similar "benefit" but only work for some patients and not others. Currently, we can't predict that very well. A great example is antidepressants. You can take the same kind of antidepressant (for example an SSRI). One works for you and the other doesn't even though theoretically they should do the same thing and have the same benefit. Unless you build that into the system treating certain conditions (especially mental health ones) is going to be a nightmare.
1. How are drugs that are on-patent classified? In a separate class?
2. How would the Epipen be classified?
I tend to be more on the conservative side of dealing with paying for medicine, but this is a fantastic idea. It opens up information on prices so consumers can understand what they are getting. Encourages smart choices. And encourages innovation. Of all the medical reforms, this should be the least controversial.
Not only smart choices by drug companies, but also responsible purchasing on the part of patients too. A win/win really. Why isn't this seeing bipartisan suppo--oh wait. Congress.
Jachim Soyer Congress ruins everything. Cheap political points are worth more than sound decisions.
All I have to say about this topic is that drugs in the U.S. are overpriced compared to other countries. Like some of the comments I see on here, people buy their drugs overseas for a cheaper price. This also affects insurance companies and how much they actually do for the patient when buying drugs. Reference pricing to me seems a little chaotic. Drugs in general make the healthcare systems so much money. Its to the point where healthcare isn't looking to benefit the buyer, just make the most money. I know that was a little over the edge, but that's how it seems.
How much does a box of paracetamol cost there in the US?
RRRooooDDDD Practically nothing; a bottle of 100 pills is just a few dollars. But anything prescription costs way more in USA.
@@tookitogo Where I live, a 500 mg Paracetamol tablet costs about one cent of American dollar, or more accurately, 100 such tablets cost just one euro. Although I have never been to US, I guess, American healthcare system has a lot of room for improvement.
Saumitra Chakravarty Well, I just checked, you can get a 500-count bottle of 500mg in USA for under $6. Relative to income, that is extremely cheap.
Saumitra Chakravarty The US healthcare system is a paradox: the quality of care that is available is extremely high. But it’s out of reach of many Americans, who simply can’t afford that care. (Even with insurance, many Americans can’t afford the deductible or copay, so they forgo treatment altogether until it becomes an emergency, at much higher cost.) So you end up with a country where extraordinary care is performed, yet populationwide healthcare outcomes are not that great.
Though I have to say one of the biggest problems is changing to a cheaper drug with a different name that may confuse elder patients~ Therefore in Norway the doctor may just write a sentence to notify the pharmacy to not give them the cheapest type (and that's more or less the only reason a doctor doesn't follow this rule of thumb)
Don't know much about the rest of the countries, but spain's healthcare is awful. Pretty much everyone I know that has some chronic problem (as minor as mild alergies) has private insurance.
Peoples problem is not that their costs are not in line with the benefits of treatment. If a certain drug is less effective in treating pancreatic as opposed to lung cancer, this is certainly a tragedy, but most people are quite aware that the universe is by no means perfect, and so tragedy does occur. What enrages them most is that pharmaceutical companies are pricing drugs at higher rates than they need to in order make more money off the drugs that they sell and that the money made from the cost of medication is not used to provide better care but to be spent of frivolous luxuries.
In short, people do not expect to purchase increased longevity at a fixed rate; they wish to be given an option to purchase the best available cure at a fair price.
so why don't people just buy the cheapest drug in a class anyway, given that the therapeutic effect is similar within the class?
because people are stupid and are move by brands and the superstition that because it has a brand and cost more it must be better.
The "similarity" among the drugs is a subjective call made by someone. You could say that a Toyota Camry and Honda Accord are similar cars by some definition. You could say that a Tesla S and Hyundai Accent are also in the same class by some broader definition.
We're a country of over 300 million people and the planet is 7.5 billion. The idea that a single criterion is applicable to everyone is not only farcical; it is dangerous.
This only works for drugs that are currently on the market though- what about all the drugs that are being developed? Where are they supposed to get that money without costing taxpayers any more money?
What if we require new drugs/ therapy/ biological to show superiority over the existing standard of care for the condition, rather than just to prove non-inferiority. That way, all new therapeutics on the market will be better than existing ones. Just a thought.
Oh the irony! Got a milk commercial by the EU on this vid of HT!
If it weren't for reference pricing I'd be out on the street.
I keep hearing how much better the healthcare is over there until I talk to those who actually use it....they tend to dislike the government allowing them to be wait listed years for normal doctor visits
The only thing I hate is that our government thinks that the USA does everything so well, even if they alreade proved that expensive system didn't work.
I never have problems with doktersvisits. Depending on what I need the dokter for, I can plan visits that suit it.
GP visits usually in 1 or 2 days.
Specialists plan according to the severity of the problem. If you need acute medical attention, you will most likely get an appointment quiet soon, otherwise you may need to wait a couple of months. If the situation changes and becomes more severe, they will probably act to it.
But this is in the Netherlands. I have no clue how everything works in other countries in Europe. Even though friends in Germany seem to be able to plan doctor's visits within a couple of days.
That isn't a thing. Either you're making things up, or the people you talked to are. If they have right wing political views, that might explain why.
Now technically Europe is a big place, so I guess I can't say for sure about the entire region. But it certainly isn't true in France, the UK, Germany, Italy, Netherlands, Belgium, Spain, or Scandinavian countries.
From Belgium here: 1-2 days for my own doc and a few hours for the intern in his practice. Few hours when I had to go to the doctor on vacation in Sweden and in Germany. Debunked for western EU.
I think Price referencing should be made between the options of treatment for each case/patient.
not feasible due to the "long" pipeline in drug distribution
The problem is that corporations and industry control the legislature. Regulations are bad for racketeering
I would propose a much simpler system. make it impossible to patent drugs so that competition is maximised and at the same time the government awards companies discovery prize money for inventing the drug that covers development costs plus a bit of profit. That way everyone benefits from a big drug discovery and the company isnt left without its shirt.
+
Aspirin and ibuprofen differ. Some people can take one and not the other
The way it works in my country is that a more expensive drug can be prescribed by the doctor without added cost to the patient if there's an objective reason for it. If you're allergic to a component pf the cheaper drug, have a condition or take medication that doesn't play well with the cheaper option or if the cheaper option isn't working for you.
The last one is a bit complicated. For one you need documented history. But for instance (I'll need to be vague) a teenager had an autoimmune disease that's traditionally very well managed by corticosteroids but he had a very rare reaction to them so the state insurance on recommendation of the doctors approved a weekly IV treatment with biological drug that costs 10.000 per month (basically for life). State insurance must provide for a treatment that supports a minimum standard of quality life and in this case it just came to a very expensive treatment.
- KoperKat
Thanks for the clarification!
I had a hard time understanding this video. I felt like the examples were a little complex.
Say you want an Aspirin which has the active ingredient of acetylsalicylic acid. The drug catalogue includes ALL drugs that include that active ingredient in that dose and covers only for the cheapest option. If you want the Aspirin brand you need to co-pay.
Let's go further, you're in minor pain. You need a mild painkiller. Both Aspirin or Tylenol would do the trick. Which is cheaper? What about Actamin, Apra, Daleron, Lekadol, .... ? They all contain either acetylsalicylic acid or acetaminophen. The insurance would cover the drug shown effective for your pain, but you could choose something else available and co-pay the difference.
In reality (where I leave) this means a collegiate of specialist designs treatment protocols for a particular disease or condition and they list options for first choice, second choice (if the patient is allergic or has a condition/drug that doesn't work with the first option, first choice doesn't work as it should,...), third choice of treatment drugs. A selection of cheaper drugs within each option are then labelled as reference and are fully payed by the insurance. If the patient wants another brand name or drug from that group, they need to co-pay the difference in price. Most of the time patient don't even bother.
But sometimes... Let say the doctor says that they'll give you #THISPILL for your pain. You ask why not Tylenol? Then the doctor say #THISPILL is FDA approved, has the same dosage and the same active ingredient but costs 30% less. You can get Tylenol, but you'll have to cover those 30% yourself. It makes little difference to you, but the manufacturer of Tylenol might need to lower their price or see their sales drop dramatically.
You forgot another reason European and Canadian drug prices are so low compared to US prices: the US basically subsidizes other markets' drug prices. Companies can charge exorbitant prices in the US and use the massive profits to soften the blow of low prices elsewhere.
That's not fair to anyone here in the U.S. or anywhere else! We all, no matter where we live, shouldn't have to "soften the blow" for another region, it should all be about the same everywhere relatively speaking.
Subsidies are as foolish as you can get.
Subsidies are not foolish. And this isn't a subsidy, it's effectively a subsidy.
mmmm no. Canada has lower prices because we subsidize the drug companies ourselves. is fairly niave to say the us subsidizes anyone because they refuse to tackle the massive profit margins of their medical system.
I don't really think that's accurate. I mean, here in EU, we get very few drugs from the US.
I feel like Europe is pretty much more progressive than America on every single issue.
Aveline De Grandpré On many, but not all. The US has better laws on employment and housing discrimination, as well as MUCH stronger protections for people with disabilities. (That's why the US does so well in making public buildings wheelchair-accessible, for example.)
also, any racially based laws on employment (positive discrimination) is pretty much a nono.
Yeah, and look where that got them.
❤👏
It seems like this has been studied and it doesn't have a great impact on pricing
www.rand.org/pubs/research_reports/RR240.html
You talk about how other countries reduce drug prices without reducing innovation, but you neglect talking about the impact on innovation if the US followed suit. I believe that most of the profits generated from drugs come from the US. If those are cut significantly, no matter what the means, wouldn't that impact innovation? Please note, I'm playing Devil's advocate here.
what's the difference between a drug that doesn't exist that can cure you and a drug that does exists that can cure you but you can't afford it?
There is a legit case to make for that for newer meds, but definitely not older meds when opportunities to make back money are long passed.
A good part of price reduction is FDA approval streamline. The average approval time according to a previous healthcare triage video is about 15 years. That's pathetic.
If the drug companies are generating profit there's excess money for innovation.
Drug companies, like all other other companies, have as there primary goal to make money for the owner(s) of that company. The only reason that companies spend money on innovation is so that they will continue to make money as the years go by.
+Diana, the Inorganic Vegan
What I learned is that the patent on a drug holds for 30 years. But since the research process usually takes up around 15 years, before there is enough proof that the drug is safe enough to approve, then only 15 years of patent are left.
In these 15 years the drug is crazy expensive (so the R&D costs can be covered and a smaller or larger profit can be made) and after 15 years it becomes cheaper, because more companies can produce it.
Oh hail the drug innovation pipeline.
If you cut the revenue of pharmaceutical companies, they are going to cut investments in research. As simple as that. Anything else is just wishful thinking.
Drug companies spend many times more on marketing than they do on research. Maybe they should cut their ad budgets and increase research while cutting prices.
www.washingtonpost.com/news/wonk/wp/2015/02/11/big-pharmaceutical-companies-are-spending-far-more-on-marketing-than-research/
But almost the majority of drug research is in the united states, isn't this misleading?
This won't happen because of greed.
this misses the whole root of the problem (in the united states). how about no more lobbying?
This video avoids the main point “Innovations” and talks about cheaper prices instead. Very misleading.
This is so cool, however, if the Canadian Province of British Columbia can do it, what's stoping the U.S. states of California, Texas, or New York (among others) from applying this within their own state borders? Their residents could benefit from these better pricing options and U.S. politicians can point out at a domestic version of this skim, so that xenophobic idiots can't say is not possible in the USA, unhindering it in the process for the rest of the U.S. states. As for the version to be used of this pricing skim I kind of like the average pricing option that Germany and Spain follow as well the average can seem fairer to pharmaceutical companies, but the lowest price possible would be awesome to have!