# KV Pharma - A royal screwing w/o vaseline **URL:** \ **Category:** The BBQ Pit\ **Created:** [March 30, 2011, 1:10am UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449 "2011-03-30T01:10:56Z")\ **Posts on this page:** 6\ **Page:** 7
**Author:** ![Gorsnak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gorsnak/32/7587_2.png) [@Gorsnak](https://boards.straightdope.com/u/Gorsnak)\ **Post date:** [April 2, 2011, 6:26pm UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/121 "2011-04-02T18:26:42Z")
> [@mhendo](#): > > If the US started imposing price controls, there could be a bunch of different effects. Most obviously, pharma profit levels could drop. Other possible consequences might be that R&D on more marginal products and new chemical entities would be reduced, and companies would focus even more on “me-too” drugs. Companies might refuse to sell their product at all to places where the government-imposed price controls fall below the level required to generate a profit. I’m not an expert on the economics of pharmaceuticals, so i’m sure there are possible consequences that i’ve missed. Couple things. One, if companies refusing to sell drugs seen as needed in some country with price controls becomes at all common, it’s politically likely that that sovereign nation would revamp drug patent laws to allow their domestic pharma companies to make generic knock-offs. Two, relying on private pharma drug research isn’t really working out that well for us. They’re focusing on maintenance drugs for chronic conditions, since that’s where the money is. Is big pharma at the forefront of research on next generation antibiotics or antivirals? That would be news to me. Three, R&D may be a significant portion of pharma expenses, but it’s by no means the largest. Especially if you mean the actual basic research, as opposed to the busy-work of clearing FDA hurdles. It’s not at all clear to me that in the face of decreased earnings, R&D would be the place to look for cost-savings. ---
**Author:** ![Rotlla](https://avatars.discourse-cdn.com/v4/letter/r/278dde/32.png) [@Rotlla](https://boards.straightdope.com/u/Rotlla)\ **Post date:** [April 2, 2011, 6:35pm UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/122 "2011-04-02T18:35:12Z")
> [@Gorsnak](#): > > Couple things. > > One, if companies refusing to sell drugs seen as needed in some country with price controls becomes at all common, it’s politically likely that that sovereign nation would revamp drug patent laws to allow their domestic pharma companies to make generic knock-offs. That is already happening to some extent. Brazil and India have done it; the problem is that if more nations do it, there will no longer be any economic incentive to develop drugs at all. > [@](#): > > Two, relying on private pharma drug research isn’t really working out that well for us. They’re focusing on maintenance drugs for chronic conditions, since that’s where the money is. Is big pharma at the forefront of research on next generation antibiotics or antivirals? That would be news to me. Where do you think any drug comes from? It was big pharma that came up with Zyvox, generally the current antibiotic of last resort. They don’t come out with new drugs all that often because drug discovery is incredibly difficult and expensive. > [@](#): > > Three, R&D may be a significant portion of pharma expenses, but it’s by no means the largest. Especially if you mean the actual basic research, as opposed to the busy-work of clearing FDA hurdles. It’s not at all clear to me that in the face of decreased earnings, R&D would be the place to look for cost-savings. Right, but their other expenses – production, advertisement, marketing – are all expenses that are basically guaranteed to return profits to them. So cuts to any of those parts of the company budget would make the company poorer; since R&D does not have the same return on investment, anyone running a pharma company would be irrational not to cut that first. ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [April 2, 2011, 8:44pm UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/123 "2011-04-02T20:44:29Z")
> [@mhendo](#): > > If the US started imposing price controls, there could be a bunch of different effects. Most obviously, pharma profit levels could drop. Other possible consequences might be that R&D on more marginal products and new chemical entities would be reduced, and companies would focus even more on “me-too” drugs. Companies might refuse to sell their product at all to places where the government-imposed price controls fall below the level required to generate a profit. I’m not an expert on the economics of pharmaceuticals, so i’m sure there are possible consequences that i’ve missed. There’s a fair bit of “me-too” already. Look at psychopharmacology. Lots of drug variations–admittedly about as effective as a placebo on most patients–seeking a profit. If the state were running it, we might see more research into real undertreated areas, rather than another five SSRI’s. Or what Gorsnak said. ---
**Author:** ![Nava](https://avatars.discourse-cdn.com/v4/letter/n/da6949/32.png) [@Nava](https://boards.straightdope.com/u/Nava)\ **Post date:** [April 5, 2011, 9:36am UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/124 "2011-04-05T09:36:23Z")
> [@ladyfoxfyre](#): > > Because if there were no financial incentive to continuing research on alternative uses of medication, that research would not be done and those uses would not be found. But that is not directed research: researchers don’t spend time giving medications to people “let’s see if this aspirin helps with your heart condition… let’s see if this ibuprophen helps with your incontinence…”; they’re serendipitous findings, where someone with conditions A and B is given something for condition A and it turns out to help B. The research performed to confirm that initial finding is directed, but also something which is done under very different conditions than initial drug studies. ---
**Author:** ![Jeff\_Lichtman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jeff_lichtman/32/1531_2.png) [@Jeff\_Lichtman](https://boards.straightdope.com/u/Jeff_Lichtman)\ **Post date:** [April 15, 2012, 8:13pm UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/125 "2012-04-15T20:13:04Z")
Sorry about reviving this old thread, but this has bothered me for quite some time and I finally decided to do something about it: > [@ladyfoxfyre](#): > > Listen, it’s not anybody’s problem but your own that you don’t know how drug patenting or the FDA works. Your basic understanding of patent law is shit as it relates to drug laws. So go educate yourself. No, it doesn’t apply to drugs, to say the least. Now go learn some shit or shut the fuck up about what you don’t know. From the [FDA web site](http://www.fda.gov/Drugs/DevelopmentApprovalProcess/ucm079031.htm): > [@](#): > > Patents and exclusivity work in a similar fashion but are distinctly different from one another. Patents are granted by the patent and trademark office anywhere along the development lifeline of a drug and can encompass a wide range of claims. Exclusivity is exclusive marketing rights granted by the FDA upon approval of a drug and can run concurrently with a patent or not. Exclusivity is a statutory provision and is granted to an NDA applicant if statutory requirements are met. See 21 C.F.R. 314.108. Exclusivity was designed to promote a balance between new drug innovation and generic drug competition. In other words, the FDA itself says it doesn’t grant patents. So whose “understanding of patent law is shit as it relates to drug laws?” You, the person who has been “involved in the pharmaceutical industry for so long,” apparently don’t understand the difference between a patent (which the FDA cannot grant) and an exclusive license (which it can). ---
**Author:** ![Boyo\_Jim](https://avatars.discourse-cdn.com/v4/letter/b/87869e/32.png) [@Boyo\_Jim](https://boards.straightdope.com/u/Boyo_Jim)\ **Post date:** [April 15, 2012, 9:10pm UTC](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449/126 "2012-04-15T21:10:31Z")
> [@Bricker](#): > > Yes, and how convenient of you to ignore the litany of complaints against the FDA from Republicans, especially since an artificial monopoly award to a company that did NOT invest any particular effort in design and research is a false signal to the free market and an action that Republicans decry. > > And good for them… but if the DEMOCRATS in charge of HHS, FDA, and the White House would act, then no one would need to “try” and get the FDA’s decision revoked, would they? > > And what could Republicans do to reverse this, if they wanted to? Nothing. This is entirely in the hands of Democrats. > > This is beyond ridiculous. The decision was made by Democrats, and Demorats would be the ones to revoke it. Take off your partisan blinders and put the blame where it belongs. I’m curious about a couple if things. Once, does a company that is going to be granted such a monopoly have to make any kind of declaration about their proposed costs and prices for the drug in advance? If not, that’s either an argument that this kind of market interference shouldn’t take place at all, or if it does, then the process has to be more regulated. The concept behind the Orphan Drug law is that there is insufficient demand for the drug in the market to assure that it is manufactured in adequate amounts and that the manufacturing company can earn a reasonable profit, correct? If that’s the case, and there is in fact so much demand for it, how did it ever get classified as an orphan drug? Second, does the FDA have any authority to act upon learning about such financial shenanigans? I would think they would have some powers if there was some question about the quality or efficacy of the product, but it would seem the marketplace decisions are kind of not in their ballpark. [Previous page](https://boards.straightdope.com/t/kv-pharma-a-royal-screwing-w-o-vaseline/576449.md?page=6)