[N_Fiddledog]

The way the PMPRP explains it, Canadians were at one time paying 24% more for drugs than anybody else. In other words we were being japped. This brought about price controls. The drug companies were getting greedy, and they brought these controls on themselves. It has nothing to do with that guy's false claim "Canada is a Socialist country". Jeez, Mulroney gave the drug companies 8 extra years of patent protection (and they burned us on that with something called 'Evergreening'). Mulroney was a socialist? If that's the claim is the guy saying he doesn't want the extra 8 years of gravy the flaming, red, commie, Brian Mulroney? from Canada gave the drug companies.

The guidelines used by the PMPRP sound pretty reasonable to me.

$1:

# The prices of most new patented drugs cannot exceed the price of the most expensive drug that treats the same disease;
# The prices of breakthrough or substantial improvement drugs cannot exceed the median of the price in other industrialized countries;
# Prices cannot increase more than the Consumer Price Index; and
# The price in Canada can never be the highest in the world.

http://www.pmprb-cepmb.gc.ca/English/vi ... 134&mid=68

Concerning how much drug research is done in Canada. This is from 2001.

$1:

The issue is of major importance not only to Canada's 58 research-based drug companies, which invested $1 billion in R & D last year, but also to the generic drug industry, which has about a dozen firms in Canada.

http://www.cmaj.ca/cgi/content/full/164/9/1331

Drug companies are crooks, and drug patent laws are freakin insane. Try a search at Google or YouTube on 'Michael Crichton Drug Patent Laws".

[Scape]

The patents elevate the costs of new drugs much like the cost of new electronics are high when they are on the market as well. In both cases they are also with their share of bugs much like how a blue ray player was $1000 dollars when they came out and not very reliable. Now they are nearly $100 and have way more features. New drugs go though the same price curb. It just doesn't make sense to cover these wonder drugs that have yet to be proven and are hugely expensive when there are other drugs with better supply and better proven track records with multiple manufactures already on tap at much lower cost.

[Toro]

Fiddledog

Thanks for tracking down the requirements. I knew that Canada paid the median of other industrialized countries. I did not know the other requirements.

A few points (which may be hypothetical, because I do not know if they are all true).

If costs are rising faster than the CPI, that could lead to a shortage of drugs in Canada. Or it would most likely lead to price increases in other countries to offset the profit squeeze in Canada. The prices for medical products have risen at a faster rate than the economy as a whole. This would mean that Canada is being subsidized by someone else.

Canada also lives by the kindness of strangers, which must be the case if Canada will not pay above the global median price nor can it be possible that the Canada will pay the highest price in the world. We can visualize what would happen if every country in the world had the same requirements.


Scape

First, I hope you are well.

As to your point, you are dead on. The argument that America subsidizes the rest of the world was always apparent to me in that America usually absorbs the cost of the move down the cost curve. Once the economies of scale have been established, the drug companies can lower prices for others.

[sandorski]

Toro Toro:

Fiddledog

Thanks for tracking down the requirements. I knew that Canada paid the median of other industrialized countries. I did not know the other requirements.

A few points (which may be hypothetical, because I do not know if they are all true).

If costs are rising faster than the CPI, that could lead to a shortage of drugs in Canada. Or it would most likely lead to price increases in other countries to offset the profit squeeze in Canada. The prices for medical products have risen at a faster rate than the economy as a whole. This would mean that Canada is being subsidized by someone else.

Canada also lives by the kindness of strangers, which must be the case if Canada will not pay above the global median price nor can it be possible that the Canada will pay the highest price in the world. We can visualize what would happen if every country in the world had the same requirements.


Scape

First, I hope you are well.

As to your point, you are dead on. The argument that America subsidizes the rest of the world was always apparent to me in that America usually absorbs the cost of the move down the cost curve. Once the economies of scale have been established, the drug companies can lower prices for others.

No. They are ripping you off and trying to make you feel good about it by feigning being ripped off by other Countries. Your Prices exist simply because you are willing to Pay them, not because the Pharma Corps require them.

[Scape]

Hey Toro, long time to chat. Doing well with my hammock, pool and cold beer.

The problem with big Pharma is they can sell snake oil and no one can call them on it and charge an arm and a leg in the process when people are in their most desperate hour of need. That's not a free market that is extortion. If there was money in cures cancer would be a thing of the past but the fact is there the real money is in sickness. With the biggest industry next to the military they can spend billions on ads and lobbyists wining and dining‎ Doctors and ministers that shape policy until they have the desired effect no matter what oath or pledge might have swore to because they spends millions a day to do it.

[Proculation]

It's sure not free market: they have patents and monopolies.

[sandorski]

Proculation Proculation:

It's sure not free market: they have patents and monopolies.

Patents are definitely required.

[Lemmy]

Yeah, if you don't allow companies to have patent protection, why would they undertake the costs of researching new medications? We economists LOVE programs with positive incentives. Patents are one. Yes, the customer bears a heavy cost, but even having to bear a hefty price for medication beats the shit out of being dead. That said, pharmaceutical patent length doesn't need to be 17 - 25 years, as it is in many jurisdictions. Even a few years of patent protection would be a major boon to any company with an effective treatment for a serious disease. Furthermore, if patent protection is short, the pharmaceutical companies have further incentives to continue working hard to develop new products to maintain exclusivity on the cutting edge.

That's not to say that Scape's "snake-oil" fear isn't a well-founded concern.

[Scape]

Under current rules, countries are required to respect drugs patents for 20 years.

[Lemmy]

Scape Scape:

Under current rules, countries are required to respect drugs patents for 20 years.

Good read. Yeah, 17-25 year patents are "corporate pandering", not "incentive to invest in research". 3 years would provide incentive enough, I think. We could also create legal power to suspend patent protection for humanitarian reasons, in impoverished nations, disaster areas and the like. The pharma comp still has the ability to sell the product elsewhere in the world. That would certainly require an international accord to accomplish.

[Mukluk]

"...this is an accident of Canada being a less-free country than the US..."

buahahaaha! Why don't we have a beer in Havana to discuss freedom. Oh yeah, your government won't allow you to go there. "Freedom" kinda bites, I like mine better. Off topic, but that whole freedom thing gets old...

I think health care is a giant shitball. No matter how you try to handle it, you just end up covered in it.

I don't buy that Canadians are simply covering marginal cost of production (variable cost) for the drugs, they cost less than smarties to make once everything is approved and manufacturing is underway in earnest. The "freedom" afforded by the American system is that the pharmas get to find the right "price point" for the drug, it is not a cost recovery + margin formula imho.

The shame is that it is all driven by us, the shareholders, that demand large returns for our portfolio.

m

[PublicAnimalNo9]

Wow, so the $2500/mo my Grandmother shelled out for the one particular med she was on was the CHEAP price??? Sorry, not buyin it. BUT, Toro's post DOES explain, rather unintentionally, why pot will never be legalized in the US.

[BeaverFever]

Big Pharma has all kinds of tricks to keep the price high in the US.

For starters, they spend as much on R&D as they do on marketing:

$1:

U.S. drug companies spend almost twice as much on marketing and promoting medications than on research and development, a new Canadian study says.

"These numbers clearly show how promotion predominates over R&D in the pharmaceutical industry, contrary to the industry's claim," the authors write in this week's peer-reviewed journal Public Library of Science Medicine.

---
Promotional activities included free samples, visits from drug reps, direct-to-consumer advertising of drugs, meetings with doctors to promote products, e-mail promotions, direct mail and clinical trials designed to promote the prescribing of new drugs rather than to generate scientific data.

The authors say their figure of $57.5 billion US is likely an underestimate, citing other avenues for promotion such as ghostwriting of articles in medical journals by drug company employees, or the off-label promotion of drugs.

Drug companies have long argued they are driven primarily by research, while critics charge that marketing and profits are their primary concerns.


http://www.cbc.ca/consumer/story/2008/01/03/drugs.html

A good primer on BIG PHARMA can be read online here:

http://www.nybooks.com/articles/17244

$1:

Second, the pharmaceutical industry is not especially innovative. As hard as it is to believe, only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH). The great majority of "new" drugs are not new at all but merely variations of older drugs already on the market. These are called "me-too" drugs. The idea is to grab a share of an established, lucrative market by producing something very similar to a top-selling drug. For instance, we now have six statins (Mevacor, Lipitor, Zocor, Pravachol, Lescol, and the newest, Crestor) on the market to lower cholesterol, all variants of the first. As Dr. Sharon Levine, associate executive director of the Kaiser Permanente Medical Group, put it,

If I'm a manufacturer and I can change one molecule and get another twenty years of patent rights, and convince physicians to prescribe and consumers to demand the next form of Prilosec, or weekly Prozac instead of daily Prozac, just as my patent expires, then why would I be spending money on a lot less certain endeavor, which is looking for brand-new drugs?[4]

A second trick they do is game the system to extent patents and keep generic versions off the market. Generic manufacturers are generally smaller than brand name manufacturers and through coercion and bribery, Big Pharma is often able to encourage them NOT to produce generic versions even when the patent expires. One famous game is that US Drug patent law allows the drugs inventor exclusive rights for a period of time, after which generic manufacturers can successively enter the market, in order of a bid. So Generic Manufacturer 'A' might have exclusive rights to be the sole generic producer of a brand-name drug for 180 days after the patent expires and no other generic producer can make their version of the drug until company 'A' exercises this option. The big pharma brand name company pays Generic Co. 'A' to NOT produce the drug, thereby acheiving a defacto monopoly in the so-called 'free' market as other generic producers can not begin production until 'A' has exercised their right to produce. This is known as a "pay for delay” or “reverse payment" scheme:

http://www.bloomberg.com/apps/news?pid=20601202&sid=asN6arCrs5GY
http://www.antitrustlawblog.com/2009/07/articles/the-ftcs-latest-remarks-in-opposition-to-reverse-payment-settlements-banning-them-would-save-consumers-35-billion/