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Bringing a drug into the world is not easy. It is an intensive, unpredictable and extremely stressful business that can shatter the hopes of the world’s greatest scientific minds and the patients they seek to serve. Initial wins in clinical trials can quickly deviation into cataclysmic failures.
But this reality, and the unique nature of the life-changing mission of the pharmaceutical industry, becomes messy when it clashes with the largely laissez-faire attitude of the US government towards drug price regulation. . The current system gives companies like AbbVie, Pfizer, Biogenic, and all the titans in the industry have almost carte blanche to price their drugs, no matter how long they’ve been in existence. Industry takes full advantage by increasing prices year after year, and 2021 is no different.
Consider AbbVie. The company, which acquired another pharmaceutical company and maker of Botox Allergan as part of a mega-deal in 2019, makes the best-selling drug in the world, Humira, who brought nearly $ 15 billion in the US alone in 2019. This anti-inflammatory drug treats a variety of conditions ranging from psoriasis to arthritis to Crohn’s disease. So there is no reason to strike science. But Humira’s first approval was in December 2002. Almost two decades later, AbbVie is still raising its price despite no real change in what the drug actually is.
Brad Loncar is a biotechnology investor with an affinity for the industry and the innovation it engenders. He also criticizes a model that inherently encourages perpetual cost increases in order to guard against the risk of scientific failure. He’s a model, as Loncar said Fortune in the days of the AbbVie-Allergan deal, which pushes financial engineering at the expense of the medical magic that is at the heart of the industry. The latest Humira price hike for 2021? 7.4%.
This is the part of the story where the pharmaceutical executives raise their hands. The industry regularly argues that this is an unfair characterization since list prices do not match what a hospital pays, or what an insurer pays, or what a patient pays for. medicine from his pocket.
The exact amount charged will vary depending on your insurance status or the payment programs put in place by the major pharmaceutical companies. Plus, you can learn new uses for an existing drug. A treatment like Humira which was started to treat a condition can possibly treat a dozen.
This has serious financial implications for the average American. Even before this latest round of price hikes, the U.S. list price of the Humira standard 40 mg injectable pen has fallen from $ 16,636 for a one-year supply in 2006 to $ 58,612 in 2017, according to the AARP Public Policy Institute and University of Minnesota PRIME. Institute.
Alongside Loncar, even other longtime investors in the life science community say the model is broken. Biogen is another offender this year with his Tysabri treatment, which is used for patients with multiple sclerosis.
While AbbVie and Biogen are singled out for the price increases they have announced so far, many other companies are following the same pattern. Pfizer, Sanofi, and GlaxoSmithKline are all price increases between 0.5% and 8.6%, including for successful drugs for therapies such as the anticancer drug from Pfizer Ibrance and the anti-inflammatory drug Xeljanz.
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- Trump hyped Verily’s Coronavirus Testing Tool. This led to less than 1% of all tests in 2020
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