The funny thing is that Epipens have been really expensive for a while. Sure they took a 15% price increase over the past year. The price has been over $400 for a two pack for a while.
The reason why this has come to a head is high deductible health plans. This is where you pay the first $1000-$6000 in medical costs before insurance kicks in. When all it was was a $30 copay, consumers didn't give a shit.
So maybe, just maybe, pushing more medical costs to patients will actually create the pressure needed to reduce medical costs? Interesting thought.
And instead of insurance companies, it appears Social Media mobs are being effective at collective bargaining, which in other countries outside of the US has shown to be effective at keeping prices lower. Unfortunately it's a very selective outrage.
The problem is that most doctors don't take treatment costs into account when writing prescriptions. They may not even know the cost themselves. And patients can't really be expected to keep up with the prescription drug industry enough to request cheaper alternatives.
There are competitors to the Epipen but they don't get prescribed as much. I would surmise that has something to do with marketing budgets. Maybe we should join the rest of the world and ban drug advertisements? Oh, and allow Medicare to negotiate a bulk rate for drugs rather than pay MSRP[1].
> They may not even know the cost themselves. And patients can't really be expected to keep up with the prescription drug industry enough to request cheaper alternatives.
In Australia we solved this by requiring pharmacies to offer generic alternatives.
Including the US. Unless your doctor names a specific brand and includes the phrase "dispense as written" on the prescription slip, you'll almost certainly get a generic.
>And patients can't really be expected to keep up with the prescription drug industry enough to request cheaper alternatives.
You don't have to keep up with the Rx industry to research different treatments and pricing for your individual condition. When I went to the dermatologist for skin cancer screening, she prescribed me Picato for my actinic keratosis. When I called the pharmacy and found out it would cost $200 after insurance, I called BCBS and spoke with their pharmacist about alternatives. She gave me a short list of brand names and generics, from $10 up, and at the end I decided to go with the doctor's Rx because it had the shortest treatment and recovery time. I did find an online coupon, however, which my doctor didn't tell me about.
Why should that burden land on patients? Many patients will have trouble understanding the pros and cons of different meds; especially if there is any polypharmacy going on.
Because it's the patient's health and their money? It's not like they have to make the decision on their own. The grandparent mentioned he called his insurance company's pharmacist and got advice.
Another problem is that the software doctors use sometimes presents a drop down list of medication, and the expensive version is at the top of the list.
I have a friend who recently became a pharma shill. Job pays far better than running the biomed lab, and comes with fantastic perks (and expense accounts) for simply educating doctors about drug options.
There's no way a GP can keep up with everything that's out there. Less expensive remedies have no one to fight for them either.
Until we see a measurable, provable change from one of these "social media" campaigns, they don't mean shit.
The Internet's attention span is 45 seconds on a good day, and that's not enough time to affect real change. Until this changes companies realize that all they have to do is weather the (brief) shitstorm until people move on to the next buzzworthy thing and then they can just go back to business as usual.
How many people know that the drug Martin Shkreli jacked the price on is still that same price long after he left the company? They never even did a show of putting it back briefly, the price was jacked up, Martin took the hate off the drug company that did it, and they kept collecting the money.
I don't think social media can affect real societal change because it's like trying to get an unmedicated ADD kid to do his homework, you can't hold his attention long enough to make meaningful progress.
Isnt this the free market being discussed rather than government? And isn't this a great example of "supply and demand" being an over simplification of the factors that can influence price?
Yes this is exactly it. High deductible health plans are succeeding in making prices more transparent and letting the markets work as a check on healthcare costs.
What Mylan is trying to do is a bit sneaky -- mollifying the high deductible complainers by giving them a coupon they can use but I believe in the long run it will backfire since it will drive more people to high deductible plans.
low deductible health insurance plans dont make much sense b/c no one has an incentive to save money. by having people share in more of the costs (up to a certain level) I think you get market forces to help keep prices in check
Market forces either didn't work or were suddenly introduced (otherwise how did the price get so high?) in this case. But people buying epipens don't have a lot of options, and unlike the price of coffee or something you're dealing with anaphylactic shock...
> The reason why this has come to a head is high deductible health plans
That was one of purposes of high deductible plans -- to expose people to the prices.
In an ideal situation they would go search for more reasonable alternatives so create a market, but other, unintended perhaps consequence is it creates an outrage. So far, though, it is more of an impotent outrage. The stock went down from $50 to $45. That's not huge, it will recover soon.
The results of such an outrage is often the opposite -- other companies see and say "Ah, well, everyone else doing it without repercussions, we should raise our prices by 200% as well".
Mylan didn't reduce the retail price. They're giving out coupons and offering deals for poor people. Insurance companies and schools are still paying full price.
A comparable device, the Emerade Auto-Injector, made by Bausch and Lomb / Valeant, sells for £26.94 in the UK.[1][2] The UK, of course, has socialized medicine.
The company behind Emerade is more into cutting deals with other pharmaceutical companies than bringing prices down.[3] "Valeant’s strategy is to focus on the business of core geographies and therapeutic classes, manage pipeline assets through strategic partnerships with other pharmaceutical companies and deploy cash with an appropriate mix of selective acquisitions, share buybacks and debt repurchases. Our leveraged research and development model is one key element to this business strategy and will allow us to advance development programs to drive future commercial growth, while minimizing research and development expense."
has nothing to do with socialized medicine. You can buy anything on amazon, where fierce competition keeps prices low. Try comparing prices for medical devices or hospital prices. The healthcare "market place" is completely disfunct and government ("social") is a key monopolizer.
Socialized medicine in Canada, and prices are also reasonable.
"The Canadian price has remained constant for more than five years, thanks to regulation by the Patented Medicine Price Review Board, which has strict control over the prices pharmaceutical companies can charge for their products. In Canada, the auto-injectors can be claimed under most provincial drug benefit programs."
https://www.thestar.com/news/canada/2016/08/25/americans-tur...
The government is better able to negotiate with pharmaceutical companies because of its size, which is part of why medicare pays them less than even private insurance companies do. Individuals, in comparison, often don't have time to do research or compare prices when they have an emergency, so the healthcare industry takes advantage of that weakness.
I think you actually have this kind of backwards. For example, when I broke my toe last year I had to wear a boot for 6 weeks. I didn't really have a choice but to let my Dr give me one, given my inability to walk without crutches or a plaster cast otherwise. I received a bill from them for $384 a couple weeks later. It was the first bill I disputed with my insurance company, using the fact that I could buy the identical product on Amazon (and a number of other online retailers) for <$80. Aetna was just "tough luck" and paid ~$200 of it, leaving me to pay the other ~$200. Things like this happening are just plain stupid.
I'm missing your point I think - how does jmcgough have things backwards? It sounds like you had issues with a private company? In a country with a socialised healthcare system you wouldn't get a bill and the company selling the moon boot wouldn't get paid nearly as much.
No, Medicare is specifically prohibited by law from negotiating drug prices. They can and do negotiate prices with hospitals and doctors, but not drug companies.
Interesting - the TPPA which is being imposed on New Zealand is very specifically anti our national purchasing of drugs. This existing regime has been a very good bulk purchaser for 3+ million people and has kept prices down.
I've looked but can't find the rationale behind that law. I know the real reason was to keep drug prices high but how was this sold to the American people?
The fear is the "bargaining power" that will be used is "give it to us or we invalidate your patent." And the fear is valid, because that's how most other countries' governments negotiate.
That video on the NYTimes page you linked is a PR disaster for her... She did an awful job at trying to defend a poor idea. On top of that, she kept quoting statistics that make it seem like the EpiPen is more needed....
More needed, but the price is staying the same!
Logic is confusing there....
To go with that, her posture/hand motion is just awkward....
She pointed out most money spent on EpiPen has been going to getting laws on the books (in 48 states!) to allow non-designated EpiPens to be available in schools and other public places.
Wouldn't there be other good ways to ensure everyone has access? Eliminate the need for a prescription for instance? How does one go about doing that?
She doesn't say that most money has been going to the laws. She says they have expended resources on lobbying for those laws without specifying how much.
The CNN video that plays at this links says their margins were 9% in 2007 when the bought the drug and 55% in 2014.
Any business with 55% margin is a nice business to be in.
It's also kind of scandalous that they've designed a method to reach around the insurance companies. I don't think drug companies should be allowed to offer consumers rebates that make them more likely to utilize their insurance. When they start from a high price, it's an accounting trick that doesn't cost the company anything. If a company so strongly believes they've miss-priced their product, they can simply reduce the price.
True statement - she doesn't say most. However, she stresses how most of their effort is going towards laws. There was a mention of some slight improvement to the injector, but the formulation certainly has not changed.
Going around the insurance companies is pretty insane, especially because there are multiple types of customers: individuals, schools, hospitals, etc. Should an individual get money back, but not a school? It's not like public schools have a bunch of cash lying around.
> Some of the most prominent groups — Food Allergy Research & Education (FARE); the Asthma and Allergy Foundation of America (AAFA); and Allergy & Asthma Network — all have partnerships with Mylan for patient awareness campaigns and other programming. The groups aren’t required to disclose how much money they receive from the drug company, but Mylan, in its 2015 Social Responsibility report, lists all three groups as “allies.”
What Mylan learned here is that they didn't have enough social media presence. I bet their had a meeting and didn't say "Yap we have been assholes about this, let's roll back prices and appologize" but rather "People feel we are assholes. Who is responible for our social media and marketing? Action item 1) need to allocate more funds and hire a better PR company".
What I don’t understand in this story, who and how limited the competition?
The product costs a few bucks to produce, retails for $600, and not covered by patents: epinephrine discovered in 1901, the autoinjector is derived from military model likely in public domain.
How comes no one in the whole US wants to earn billions manufacturing a similar product and selling it for $50?
There was competitor (Sanofi) but they had a product recall, because it wasn't delivering the right dosage.
What people don't seem to understand is - healthcare products are no laughing matter (literally). This isn't like software, where you can release early, release often, and where alpha quality is tolerated (to a degree).
For whatever reason, Mylan have done the FDA testing, and perfected a product that works reliably. That is expensive. (I suspect profit factored into it somewhere).
There's nothing stopping somebody for designing a different device (like Sanofi) did that does the same job - the devil is in the detail, and making sure you don't f_ck up.
Because believe me - the moment you screw up, and deliver the wrong dosage to some kid in anaphylatic shock, and he/she dies...your company is history (or facing a very costly recall and/or potential lawsuit).
My daughter recently had a health-scare. That moment, when I looked at her, and honestly thought she wasn't going to make it, was heart-wrenching. So I can tell you, as a parent, if my daughter was allergic to something, and the Epipen was $600, and I needed one around - sure, I'd be bummed about the money, but no, I wouldn't not pay it. And if you told me, these are the only guys so far who have made sure it's reliable, or you can get these cheap 3D printed copy that might work 85% of the time, or she might die but it's only $100 and realy, what's 15%?? What do you think I'm going to go for?
If this was like, say, something else that wasn't literally life-saving, then sure, people's risk appetites would probably change dramatically.
As a paramedic: So the issue isn't the epi itself (which is just adrenaline). In fact EMS agencies around the country are moving away from the EpiPen (in my state, all ambulance and fire units are required to carry the pen itself) to drawing up from ampoules. In my relatively small county, Medic One throws away $100,000/yr of EpiPens, because they have a short shelf life.
"Wrong dosage", though? Dosing epi isn't a particularly exact science - the adult pen is 0.3mL, the junior 0.15mL. Quite often we will have to use multiple pens on the one patient.
Underdose is entirely common - especially in civilian-administered situations. Overdose is typically restricted to acute hypertension and associated symptoms which can largely be managed by EMS (who should be enroute anyway for any admin of epi, for reasons not least of which include that 'need for additional dose').
> Sanofi US Issues Voluntary Nationwide Recall of All Auvi‑Q® Due to Potential Inaccurate Dosage Delivery
> ...
> If a patient experiencing a serious allergic reaction (i.e., anaphylaxis) did not receive the intended dose, there could be significant health consequences, including death because anaphylaxis is a potentially life‑threatening condition. As of October 26, 2015, Sanofi has received 26 reports of suspected device malfunctions in the US and Canada.
Or is it something that somebody like an EMS would probably not get wrong, but say, a non-medically trained panicked parent could?
I've heard the shelf-life complaints about Epipens.
For me, I figured it was pretty idiot proof, even for an untrained person in panick mode - take it out, stab it in leg, and that's it, as opposed to trying to drain an ampoule into a syringe. Fortunately, I've never had to face that bad situation....
Certainly it's worth clarifying that saying that many people need more than one dose doesn't mean that Auvi-Q shouldn't have to "guarantee" that their device delivers the dose that it is intended to.
There are some things that can be done to improve the effectiveness of EpiPen/equivalent administration - while the product is designed to be able to be used through clothing, it is better to be removed where possible. Due to the dosage size, post injection site massage is recommended for better uptake from the muscles.
When to administer is also another question - arguably by the time the patient is in significant respiratory distress, it should have been administered earlier. This can be a balancing act between a 'sensitivity' and anaphylaxis. Realistically, as soon as there is a deterioration into multi-system response, Epi should be administered.
Certainly, other than cost there's no real motivator for the lay person to need to be trained to draw up epi into a syringe. But in terms of ambulances / medic units who stock epi (typically used in cardiac arrest), the requirement to stock EpiPens is an unneeded redundancy, and an expensive one at that.
Actually, funny you bring up a $50 price point. The only other autoinjector still on the US market is Adrenaclick, which is ~$140 for a 2 pack.
I genuinely have no idea why people consider there to be no viable alternative to the EpiPen - the only guesses I might have are that the third autoinjector (Auvi-Q) being pulled off the market being more "newsworthy", that insurances don't cover it (but $140 is a pre-insurance cash price!), and third but probably most important: people aren't getting prescriptions for something they're not used to using. I have never gotten a prescription for anything but "EpiPen" specifically.
How comes no one in the whole US wants to earn billions manufacturing a similar product and selling it for $50?
One of the biggest reasons is that it's not patent protected. Once a few generic versions hit the market, every manufacturer tries to grab market share by dropping the price. The price of a branded drug usually drops by 80-90% once the generic becomes available.
It looks like an attractive market right now, but once a few generics get launched, it won't be as attractive. Mylan is only making hand over fist because others failed to launch their copies.
Designing and testing a new injector is expensive and time consuming. There are certainly new devices coming to market, so the window for Mylan to make money is pretty minimal.
In the meantime, there are substitutes that are much cheaper. You can purchase an Adrenaclick from Walmart for $140.
that has much to do with nothing. point being the existence of injectors and the material in them existing before the pen has nothing to do with blocking mylan from having a patent.
Pro tip for anyone in the northern tier of the US: drive north to Canada where the same EpiPen product is sold over the counter for around 120 $CAD. And there is no rule that you must buy two at a time.
Source: my son has a severe peanut allergy and I have successfully purchased EpiPens for him at the Lethbridge AB Costco.
I may be able to answer this. Here in the US my asthma meds (two 100+ year old drugs again like epinephrine) are $75 a month each (I take 2 types so $150) with my insurance. I buy the same medicine for $20 - 25 from India (without a prescription). From what I can tell, nobody cares that I do this as I have received shipments every 3 months for the past 5 years or so. This results in me not having to take off work to go to the doctor every six months so he can say "So you still have asthma huh?" and write a script (costing me $50) as well. I just recently signed up for my company's cheapest insurance option due to this as the more expensive options simply were not providing value. Saving in total a little over $425 a month or the price of my car a year.
It looks like you can buy the pens in New Zealand and ship them to the US for about US$100, maybe a little less if you ship several at a time. Not great pricing but better than US pricing.
Only in the most extreme edge cases can anything be done about the fact the the drug companies control the government which allows them overall to do just about anything they want.
This is one edge case but the overall picture is that drug companies own the government and ensure legislation is in place to give them astounding amounts of government and consumer cash.
I hope people think about this sort of thing when voting this fall. I'm surprised at how many people will agree that neither Hillary nor Trump are desirable candidates but will also refuse to consider Gary Johnson.
This year's election seems like a perfect time to re-think unflinching support for the two main parties in the US.
This would be great if it functioned like any other healthy democracy and coalitions formed, but unfortunately there is a concerted effort to ensure there are only two tents for people to get under.
The EpiPen thing is a really great example of two facts:
(1) It's better to be in a business where you don't (literally) save lives, because nobody complains about how much money the Pokemon game makes.
(2) People won't actually take a lot of risk to market and develop life-saving products without a financial incentive.
Epinephrine is not patented. The only thing stopping a competitor from entering the market is coming up with a delivery mechanism for the drug that's as reliable as Mylan's. Apparently that has proven difficult. Sanofi used to make a competing device, until it was forced to do a mass recall because the device couldn't deliver an accurate dosage.
The difficulty of getting it right is compounded by the fact that a device that delivers epinephrine to children in anaphylactic shock is just about the highest-risk product you can make from a potential liability point of view. There is no market for a "slightly less good but much cheaper" product.
The other interesting thing to note is that people don't care so much about what the price is right now, they care whether or not it's gone up. If Mylan had launched the Epipen at $600 for a 2-pack, I'm not sure this would have gotten much attention. The fact the price went up 6x or more is what pisses people off.
This is one of the challenges with drug pricing. If you're pricing your drug to the benefit it offers (which is what is generally done), you better do it at launch or you're screwed.
This has actually happened with other drugs in the past. The drug company runs a clinical trial in one disease, gets good data and sets a price. The drug then gets approved in another indication where the value is much higher, so they try and raise the price to reflect the added value. Usually it results in outrage.
"The other interesting thing to note is that people don't care so much about what the price is right now, they care whether or not it's gone up. If Mylan had launched the Epipen at $600 for a 2-pack, I'm not sure this would have gotten much attention. The fact the price went up 6x or more is what pisses people off."
And that -after significant and hefty lobbying of legislatures to mandate that schools, EMS units (capable of managing, maintaining and drawing up epi themselves) and the like be required to carry them-.
So it's around 3-5% of their market ($600 per school is 2.5% of their $2.4 billion annual revenue on the pens). I guess that is a pretty substantial chunk.
You're framing it under a free market system. This is a monopoly where the "benefit it offers" is a persons life. In this scenario you could charge a $1M and any parent that can afford it would think the benefit outweighs the price.
The cost to market for the EpiPen was recouped long before Mylan even bought the company. This is just gouging. Believe me when I say that someone else will pop up as soon as possible (FDA approval takes a long time) with a product that costs a 5th as much, as long as Mylan doesn't manage to rig the system.
The US pharmaceutical marketplace operates under a "free pricing" system. Companies are free to set their price to whatever they feel like. The only thing that limits the price is the response of the market.
I agree that it's a not a price vs. demand equation since demand won't drop off for a product like this since there aren't really any substitutes (other than the vial and syringe which has limitations). However, public response to a price is a very strong motivator for drug companies. I can guarantee you that Mylan's C-suite is in a frenzy right now trying to figure out how to fix this.
There are other companies in other countries selling other pens that are working perfectly fine. I think you'll figure out what (2) actually is if you consider they are not selling in the US.
The government should just use 'eminent domain' and seize the rights to it. A few such cases would be enough to scare the rest of the industry to fall in line.
Eminent Domain is for securing land, not seizing property. Even so, the federal government has to pay a fair market price whenever eminent domain is used, which in this case would be a very large number that taxpayers wouldn't be happy to pay, because what comes after that? Does the government start a manufacturing business? The patents are already expired, so there isn't very much to seize.
Actually, its very easy. Government makes a list of life saving drugs. Then sets a maximum price on the drugs in the list. If a monopoly refuses to comply, the government calls for yearly bids from companies around the world (including generic drug makers from India). These companies fill the supply gap and in the meantime capitalism works and a local company steps in. There is no rocket science in manufacturing these drugs and pens - trivial once you have the recipe.
And countries, which put people before corporations, actually do this.
Setting a maximum price does not allow the government to take the patent away. The companies could simply refuse to comply, and the government would either effectively ban the drug or be forced to buy the patent/license at a fair market price.
The government has more than enough in its arsenal to force these companies to comply. cf Joseph Nacchio and QWest Communications. It knows how to play dirty and kneecap someone.
There is a Supreme Court decision that says confiscation of a patent is a constitutional taking, so they would actually have to change the constitution.
That already exists in the US. Any drug created with the use of federal money gives the gov't "march in rights" where they can seize the patent if they feel that the company is preventing access to patients. A senator attempted to do this a few months back and the NIH declined to use such rights.[1]
I wonder how long it will be before our infrastructure really starts to go south before people will wake up to what this country is becoming? I think a few bridges need to collapse before people get the idea that this is about "pump and dump" now, not investment in the future.
Bresch became CEO of the company in Jan. 2012. Prior to that, she was a lobbyist for the company. She was appointed president in 2009. She has seen her salary increase from $2.4 million since 2007 to $18.9 million last year...
One indication a drug company might be in maintenance mode rather than research mode: the president and CEO is a lobbyist.
How do people think drugs get made? Takes a lot of effort, time, energy to get a drug made and FDA approved. Shouldn't there be some incentive to accomplish this task? Wouldn't there be an overall decrease in drug innovation if there was no money in it?
In the case of the EpiPen, the FDA approval process is _long_ over (as in, decades ago). The price has increased several times over in the past decade, despite no increase in the production cost (it's $0.50 worth of epi and a couple bucks worth of plastic).
The reason why this has come to a head is high deductible health plans. This is where you pay the first $1000-$6000 in medical costs before insurance kicks in. When all it was was a $30 copay, consumers didn't give a shit.
So maybe, just maybe, pushing more medical costs to patients will actually create the pressure needed to reduce medical costs? Interesting thought.