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this post was submitted on 05 May 2024
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Definitely that insurance was cut. Drug R&D is expensive, and they need to pay people who work and have projects that don't pan out. But they should be able to spread that cost over everyone in the pool, reducing the cost to everyone to mere dollars or cents. But that requires insurance to actually fucking do their job.
Drug R&D is expensive, but it's only 21% of the top 15 Pharmaceutical companies' revenue. And that number is actually misleadingly high because it actually includes some actions that are just meant to help advertise the drugs.
Source
I really don't want to defend pharma but that study is a bit dubious.
There's a bunch of issues but the most obvious is simply that a percentage of turnover is meaningless.
What percentage would be right?
Given that they're using the cost of R&D to justify their prices? A lot more than 21%.
The rest of the world gets much lower prices. That's not out of the goodness of their hearts or the generosity of their wallets, yaknow?
You've missed my point.
The percentage of total expenditure spent on R&D is not in any way indicative of the cost of R&D compared to the sale price of a given medication.
Quite simply, maybe the majority of a company's turnover is manufacturing licensed or generic meds. No R&D required.
Does the remaining 21% equate to $2m or $2b, and how many new medications did they create with that expenditure?
That's a mind-numbingly obvious point which completely ignores the context, which is Pharma justifying their high prices based on the amount they spend on R&D.
The rest of the world gets drugs 2-3x cheaper than the US. Do you imagine they're selling at a loss to everywhere else?
Yet completely lost on you ?
If a company spends $2b on research each year and after 5 years brings a new medication to market which is only useful for 1 person in every billion, how much should that company sell that medication for and how is it relevant that the company "only" spent 21% of it's revenue on research? That company could still say that the medication is costly due to research costs and the claim would be true.
I'm not saying pharma companies aren't shady as fuck, I'm just saying that complaining about the percentage of their revenue spent on research is absurd.
The rest of the world gets cheaper medications because the medical system in the US is just a mess.
That said, some medications are still preclusively expensive outside the US "due to research".
Good grief. You don't need to wave your hands so wildly, this is really fucking simple maths. Expenditure which is 21% of the total cannot possibly be the reason why USians pay 2-3 times more than everywhere else for drugs.
Sorry chief. I don't think I can dumb it down any more for you. Good luck with that.
lol
You mean the R&D that the government paid for to take place at a public university, as is the norm? That's the expense you're claiming justifies this profiteering?
Until they start actually paying those subsidies back, that excuse doesn't explain any of their profiteering.
I’m a researcher in the biological sciences at an institute which receives lots of government funding, and was at a university before my current position. We are not being paid to develop drugs. We are being paid to develop new knowledge that hopefully can be useful (in the broad sense of the term). Practically no one I’ve ever met during my time in academia is developing drugs, and the small few that were doing so were only researching a single, small part of a very long, complex process.
The R&D you are paying for is for us to typically find out that “Protein X interacts with Protein Y and causes Effect Z. When we delete Protein X then Effect Z goes away”. We might also find out that “Molecule Q can block the activity of Protein X, but has a host of issues that make it ineffective when given to Petri dish cells and mice.” This can give you a lead towards making a drug, but what we do is basically discover a possible starting point, nothing more. If someone wants to make a drug from this, they typically will start a company and get venture capital and angel investor money, as university labs are usually poorly equipped financially and talent wise to actually develop a drug (to speak nothing of pushing it through clinical trials). Transforming Molecule Q into a bona fide drug candidate is going to require a massive amount of work that most lay individuals are completely unaware of.
I’m really curious where this concept that the government is spending tons of money on drug R&D at publicly funded universities is coming from. It sounds great as a talking point, but from my perspective within the system it’s not quite how things work.
You know that the R in R&D stands for "research", right? 🤦
Sounds a hell of a lot like that's the kind of research that's indispensable when formulating drugs.
Ya think? 🤦
Sounds like you're doing all of the research and other legwork tbh. That's hardly just "a starting point".
You mean other than how you just confirmed it while trying to disprove it?
That being the perspective of living proof that you can be intelligent and simultaneously oblivious of the obvious.
Either way, pharmaceutical companies aren't spending all their income on R&D. By far the biggest expense is advertising and after that, it's stockholder dividends of the absolutely obscene profits they're making on ripping off sick people.
Lol the guy said it himself: “I am a researcher” doesn’t understand there is an entire other part called development that also gets government funding. He works in the field and doesn’t realize that the pharmaceuticals companies “developing” drugs also get grants and tax breaks.
It’s the same for engineering.
The government funds all those small pieces of knowledge through various grants. Some are private, but most are from the government.
Then someone will take those bits of knowledge and assemble them into a new drug. 90% of the boring research is already done.
My employer pays me and my team a lot of money to develop new engineering projects based on these academic papers. Everything is cited, and normally the grad students are ecstatic to be named as contributing work. Their names don’t show up on the design patent, but if someone digs into it they can see all the work that contributed.
You might not see it at your level, and I am truly sorry for that because you deserve credit for your work.
It comes from reality
The Institut de Myologie in France is a nonprofit org that funds itself mostly from a yearly telethon and government funding... This would be you
The Nationwide Children's Hospital is a nationally ranked pediatric acute care teaching hospital located in the Southern Orchards neighborhood of Columbus, Ohio. The hospital has 673 pediatric beds and is affiliated with the Ohio State University College of Medicine
See? At least in part, the money for the start up that D the drug, based on the R France publicly provides, came from the Ohio State University which also receives public funding
As always with Capitalism... Socialise the costs, privatize the profits
This isn't what my understanding of how the system works, but the way you word it, you seem very confident that it is. I'm honestly curious what you read that lead you to this perspective.
This study should be a decent starting point.