Oh, the money “Big Pharma” spends isn’t that big of a mystory. They spend it the same places a lot of companies spend it… Trying to grow their business. In the case of the pharmacutical companies, they spend a LOT of money on DTC advertising. In fact, most drug companies are currently spending more on DTC advertising then on R&D. Now, IMHO this is a bad thing, there is no reason for a company to advertise prescription drugs directly to the public, the people they should be advertising to is Doctors, Pharmacists, Hospitals, etc…
Oh, and since you brought up Merck’s finances, don’t forget they also had a $4.5 BILLION settlement recently (as in last year) for Vioxx.
As a publicly held company their books are public.
You could, indeed, only speculate. Or you could go reasearch it and stop speculating. Or you could take your speculation public with some specifics as to just who is stealing money and who is wasting it. This would be a fine service to their shareholders, and a nice way to improve the world.
Or you could just stop speculating. I speculate you won’t, though. Some paradigms, including Big Bad Corporations are Stealing us Blind, are hard to give up–especially since some of them are. Let me know if it looks like you find some definitely getting by with it, so I can get in on their stock.
Yes, absolutely. My doctor offers to try a generic alternative if cost is an issue. He’ll say something like “I think this would be best for you but there’s an older medication available as a generic that would probably be good, if cost is an issue”. I take my dad to about 5 different specialists and they always try to find the cheapest alternatives that will do the job.
Absolutely!! Not my insurer, but seemingly everyone else’s that costs less. I hear about insurers demanding a generic alternative or proof that it’s absolutely required all the time.
Then why can brand-name medicines get away with charging so much? There is some mechanism behind the phenomenon. I gave a mechanism that would produce such an outcome, but if you are right that this mechanism is false in practice, then what is happening in its place?
Maybe I was wrong: it’s not that prices don’t factor in at all or options aren’t presented, but that people don’t have all the information to make a choice. E.g., “there is an older medication that would probably be good” gives no concrete numbers, no reliable comparison and really no information for someone to cooly say, “I’ve evaluated the options, and medicine B is 90% of the results for 10% of the cost.” So, people might just “trust” to pick expensive medicine A, as they insist on the brand name versions of chemicals available as generic. Perhaps that is the reason… some alternatives are presented to the patient, but the patient reactively picks the expensive treatments out of ignorance.
There is some mechanism there in the market. We need to identify it so that we can solve it. Solving it bottom-up through dynamic forces is the only solution. Not top-down decrees or micromanaging regulation.
I am hijacking your thread a bit as I want to ask you if this drug/eardrop works.
I have had chronic itchy ear “syndrome” for more than a year. My miseries with this are legion to me. Does this drug work?
I would gladly pay whatever it cost to get rid of this nasty complaint.
Problem is that looking through their coarse-grained books won’t reveal anything. This prospectus doesn’t list how much they’re paying for their screws, or how much they’re paying their secretaries (for their screws).
Investors are told very little.
I don’t come from the “Big Bad Corporations” bend. I’m simply pointing out the strange phenomenon that many industries that have huge operating margins don’t have huge profits.
One could even propose a “rational” explanation for this: firms try hard to grow to maximize future potential for profits rather than present profits. It’s the incentive that the stock market creates. In any case, lack of profits != company is charging low, fair prices.
I wonder if you could create this medicine yourself? You’d just need to take hemorrhoid cream and thin it with something… probably plain water.
Btw, it seems Acetasol is made up of 2% vinegar and 1% hydrocortisone. You can’t get 1% solution by using 1% cream, but 0.5% should still be effective. You can make 2% acetic acid solution using store-bough vinegar, but I doubt you should. The vinegar is there to kill bacteria in the case of an ear infection. You don’t need it if that’s not what you have, and it’s questionable if antibiotics/anitseptics should be used to treat ear infections (since they kill beneficial bacteria too). Don’t use Acetasol-like preparations if you have a perferated ear drum or herpes.
For what it’s worth, unless I’m misunderstanding you, I think you misunderstood my point about older medicine. I’m not saying the doctor prescribes brand name drugs unless I’d prefer a less expensive generic. I’m saying my doctor would say “I think this cholesterol drug is going to be most effective but if money is a problem I will prescribe an entirely different older cholesterol drug which is available in a generic”. I’ve never been in a situation where I was invited to choose a brand drug vs. a chemically identical generic. The doctor wouldn’t be willing to insist on it, the pharmacy wouldn’t fill it unless he insisted, and my insurer would throw a tantrum about it if he tried.
This is supposed to be a factual question, so I’ve given my personal experience and I won’t keep posting about it because I’m not willing to do research into it. I just wanted to share that my personal experience has been vastly different from what you say takes place.
No, not in the least. I have taken one generic blood pressure drug for years, the second bp drug lost patent protection a few years ago and my cholesterol medication is patent protected and brand name only. I’ve never taken any other medication long term but generally medication I’ve taken has been generic.
But at the risk of sounding like an ass, I make a lot of money and buy very good insurance because it’s important to me. There are lots of examples of things I spend a lot more money on than I really need to. They’re not good examples of general problems, and I’m not a representative example of prescription drug consumers. As far as I can tell your position is that doctors, pharmacists, pharmaceutical companies, and insurers are the problem when in my experience all except pharmaceutical companies are eager to use generics when medically feasible. For instance, in my case I’m willing to take the more expensive cholesterol drug because the insurer carries it. My doctor generally expresses a willingness to try an older drug available generically not because he hopes that some patients may prefer the lower cost one, but because he knows many many of his patients - even those with insurance - will wind up paying more out of pocket for the brand name drug. It’s only in my particular case that it doesn`t really matter. He’s not suggesting people consider cheaper options hoping they’ll be generous to the insurance company, he’s acknowledging that they may be much cheaper for the patient.
Me thinks you have little clue of the costs involved in web domains of that scale.
Ebay is not running on a $12,000 dell server sitting in someones back bedroom.
Its more like thousands if not tens of thousands of those servers to store and manage all of auctions at any given time.
Thousands of servers will require a serious IT staff
Customers will occasionally need support, it would not shock me if ebay has hundreds of people just to answer support emails.
Ebay actually offers many levels and styles of service to many different types of customers.
Throw in merchant processing for how many thousands of transactions per second.
Maintaining massive high speed internet connections from probably 2 if not 3 separate ISP’s to minimize downtime issues.
All the employees providing this functionality need HR support, supervisors, managers, people requisitioning parts.
When you have a website making about $1,026,694 an hour, you dont skimp on things. [end hijack]
Alex,
The mechanism you are looking for is called the “free market system.” This free market allows for innovative companies to have a monopoly on a specific drug for the life of the patent, at which point market forces will quickly drive down prices so they are more in line with manufacturing costs.
If you do not allow for a period of healthy (obscene) profits after they spend $1B in development, they would quickly curtail a great deal of innovation, instead limiting development to a few select drugs that they were confident could be made to work; not necessarily those that may fail but could change our way of life like so many drugs can do.
If you are so frustrated by the cost of new, better, less toxic medicines, DO NOT BUY THEM. Wait until the patents expire and the cost comes down. If your life depends on a new drug, then you should be out in the street praising the free market system that provided the incentive for the pharma company to spend $1,000,000,000 to develop it.