Greed And Profits Driving Up MS Drugs Prices According To Study By Oregon Health And Science University
Thailand Pharma News
Patients with multiple sclerosis
often pay, on average, nearly US$7,000 out of pocket to treat their condition each year. And, even though drug companies have provided no new treatment breakthroughs, the price of these disease-modifying medications is rising by 10% to 15% each year for the past decade.
A team of researchers at Oregon Health & Science University and the OHSU/Oregon State University College of Pharmacy wanted to find out why by recruiting four pharmaceutical industry executives to speak confidentiality. In a study published today in the journal Neurology
, the executives painted a frank picture of the rationale behind the price of medication available to people with MS.
One executive said. "I would say the rationales for the price increases are purely what can maximize profit. There's no other rationale for it, because costs of producing the drug have not gone up by 10% or 15%; you know, the costs have probably gone down."
The pharma executives acknowledged their companies' unique societal position in delivering medications to improve human health. However, each executive pointed out that their business model depends on generating a profitable return on investment to shareholders.
Lead author Daniel Hartung, Pharm.D., M.P.H., associate professor in the OHSU/OSU College of Pharmacy told Thailand Medical News
, "The most surprising thing was how unsurprising it was.There was not this secret, complicated algorithm that these companies used to drive up prices."
The OHSU researchers did however find some key themes. The researchers noted that the U.S. health care system appears to be unique in its capacity to absorb continual price increases. Executives noted that in the world's second-biggest market, Europe, the price of a drug is typically highest when it launches and then declines over time.
The opposite appears to be the case in the U.S.
One executive said, "When you're making these decisions you're looking at the whole world. And it is only in the United States, really, that you can take price increases. You can't do it in the rest of the world. In the rest of the world, prices decline with duration in the marketplace."
Typically, prices outside the U.S. not only drop due to market considerations, but they're held in check by single-payer health systems with fixed resources. In this way, one participant suggested that American patients ultimately make up for potential losses in other markets around the world.
Another executive said,"The rest of the developed world is subsidized by the U.S. consumer."
Interestingly, the price of a new drug reflected the price already set by competitors selling existing drugs that treated similar conditions, regardless of the cost of research and development. In fact, executives feared that undercutting competitors with a lower price a hallmark of a free market would instead undermine the att
ractiveness of their product.
executive said,"We can't come in at less. That would mean we're less effective, we think less of our product, so we have to go more."
Dr Dennis Bourdette, M.D., chair of neurology in the OHSU School of Medicine, and coauthor said the study provides a new perspective to public discourse around pharmaceutical pricing.
Dr Dennis Bourdette who also directs the OHSU Multiple Sclerosis Center added, "The frank information provided by these executives pulls back the curtain of secrecy on how drug price decisions are made. We see that it is indeed the race to make more money that is driving up drug prices and nothing more."
Reference : Daniel M. Hartung et al, Qualitative study on the price of drugs for multiple sclerosis, Neurology (2019). DOI: 10.1212/WNL.0000000000008653