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Good overview from @dylanscott on new congressional proposals to lower prescription costs. vox.com/policy-and-pol…
Why is it important? ~18% of US GDP is spent on healthcare, ~10% of healthcare cost is on prescription meds, but is closer to 40% of the profits. This is the low hanging fruit.
"Idea #1. Strengthen the legal remedies for generics manufacturers and crack down on 'pay for delay'". - this is a no brainer. Especially 'pay for delay' should already be a RICO violation.
"Idea #2. let Americans import cheaper drugs from Canada" - drugs are cheaper in Canada because the gov is willing to negotiate collectively. Often they're importing those drugs from the US. It would help. But boy is it silly that it would help.
"Idea #3. cap patient's out-of-pocket costs for drugs" - seems overly complicated, doesn't address the opacity in the market and therefore will ultimately be subverted.
"Idea #4. let Medicate collectively negotiate drug prices" - assuming you could avoid regulatory capture this is probably the highest leverage approach given that it replicates what has worked everywhere else in the world. Maybe we should outsource to Canada's PMPRB.
"Idea #5. use foreign prices to reduce American prices" - I'm a big fan of the "overcharge and lose your patents" approach to this plan, but I don't know enough to predict how it would play out.
"Idea #6. let the government manufacture drugs" - 85% of meds taken are generics. 65% of the profits in generics are absorbed by the supply chain. The government getting into manufacturing could do a lot to address shortages and the more egregious abuse, but is insufficient.
"Idea 7: end pharmaceutical monopolies and give out 'prizes' instead" - Hatch-Waxman 1984 set up drug IP in the US. Good for the time. Thoroughly gamed and broken at this point. Private sector has already moved to this model with R&D almost 100% acquisitions.
Pharmacy benefit manager Express Script had $100b in revenue in 2016. (they're now part of Cigna) They do no R&D. They have less than $1b in physical plants. This kind of rent seeking is endemic in the US healthcare system.
Also wrong @dylanlscott 🤦
@dylanlscott Can we get the definitive explainer sometime on why importing drugs from Canada is silly? ()
