My wife is a diabetic and on a trip to get her some more Lantus it turns out that her doctor didn’t let the pharmacy know that her dose had been increased so it will be a few days before insurance will pay for it.
I asked how much it would cost out of pocket and the pharmacist said for three 10ml vials it would be over $570.
My question is, about how much of that is profit for the manufacturer?
Looks expensive to me. The cost price in the UK in 2011 was about £40.
http://www.diabetes.co.uk/diabetes-forum/viewtopic.php?f=26&t=20655
$200 a vial sounds about right. I’ve been without insurance from time to time and Lantus is about $200 OTC, and Humalog is about $300 for a box of five pens. Walgreens says they’d gladly sell me a generic cheaper than that but there’s no generic.
Last time I bought Lantus was 3 years ago; it was $110.55 for a 10mL vial at a Target pharmacy. I actually have the record for the purchase because I’m a packrat. I’m guessing it’s gone up; Novolog (which I use all the time, unlike Lantus) was around the same price back then, and I just paid closer to $150 a vial. I pay full price for all my drugs, and my insurance reimburses me, so I know all these prices a little too well.
I’d call around, though, and check out www.goodrx.com. I keep hearing about how different pharmacies will charge vastly different rates for the same drug. You also might want to mention you’re paying for it, not your insurance, and see if they’ll give you a deal. I once got a deal on some drugs at a pharmacy because they were for my dog (prescription from a vet) and I told them there was no way I was paying $80 for a 30 day supply of a drug that my vet maybe sorta might though work. With one phone call, the pharmacist brought the price down to about $20.
Thanks for the advice, but this should be cleared up on Monday.
Hearing the price just made me wonder if it costs Sanofi-Aventis almost $200 to manufacture, package, and distribute each 10ml vial of Lantus.
According to this:
You might see generics as early as 2015.
My suggestions for drugs in general:
Check with your doc if price is a big concern. Sometimes one drug might be slightly better than another - or prefered for reasons that don’t apply to you. Many brand name drugs are simply the same active ingredient as another drug - but with a time release mechanism that can be replicated by taking a MUCH cheaper drug many times. Anyway you slice it - you can often get results very close to drug X by taking a much cheaper drug Y. If you let the doc know up front price is important - they can take into their calculus. Many good doctors already do this. You don’t often KNOW they are doing it, but they are.
Sometimes a dose that is 2x as high is not twice as expensive - sometimes it is exactly the same. I realize the drug you are talking about isn’t a pill, but there are still sometimes things you can do about it. A doctor can prescribe (for example - I know this doesn’t apply in this case) a 40 mg pill that costs the same as a 20 mg pill - and have you take half a 40 instead of a full 20 (saving you 50% in cash). I am pretty sure they could do the same with in injectable (inject 0.5 cc instead of 1cc), but don’t know how this would work with a pen.
In your case my quick search shows there might be SOME benefit in your case, but not as near as dramatic as what I was talking about. If you feel like going down that road you should find out the prices and strengths from your pharmacist (as your doc might not know what you are having to pay). He/she can then make an informed decision on how to get both the care you need at an affordable price.
BTW - my doctor actually seems to LOVE doing this. He actually seems to love the idea of fucking (his words) the insurance company. It was a somewhat complicate cased, but basically they weren’t willing to pay for this one form of a drug and he basically figured out a different form of the (basically same) drug that would get covered - and costs them way more money than if they had just covered what we had originally wanted. He had warned me ahead of time - and was right - that they might not cover XYZ - and he sprang into action upon hearing this and figured out away around it.
Just pointing this out to let you know at least some doctors would actually enjoy helping you figure out a cost effective route if you let them know it is an issue.
It obviously doesn’t. If it did, the company would be stupid to sell it for $200.
Question is, how much did it cost the company to develop Lantus and get it approved by the FDA. And how much is the “optimal” price point for the company to maximize its profits - that is, the level at which, if it increased the price, the sales would drop off precipitously, and if it decreased the price, the sales wouldn’t go up enough to compensate for the lower price.
When you add in the millions of dollars of research it very well might. But even without that, some drugs are still pretty expensive. I was surprised when one of my drugs (Imitrex) went off-patent and the cost went from something like $50 per dose to $45 per dose. It’s since come down farther, but that tells me it was probably expensive to manufacture.
Well somewhat logical, not entirely accurate. Some drugs only have one or two generic manufactures. In cases like that - say one generic manufacture - there is still usually a limited universe of patients.
Say there is a 1,000,000 patients taking brand name drug x at $100 a month.
It goes off patent and drug y goes on the market. If there is only one competitor - they want to:
Decrease the price enough to get as many people as possible to switch from X to Y while still making as much money as possible.
Even if it only costs them a dollar - they don’t want to price it at - say even $10 - as it is fairly likely that almost as many patients will switch for a very small price diff.
There may be say 100,000 patients that will stay with brand name no matter what. But other than that - you’d probably get say at least 200,000 patients that would switch for even a penny diff. Some won’t have a choice based off insurance.
They may be able to capture 90% of the patients with a $5 price diff that they would with a $50 price diff.
Then there are other factors of course - and some obviously has to do with upfront costs and difficulty. The more time goes by - the more generic manufactures there are likely to be - once you have more than 2 it vastly changes things.
More and more drugs are coming onto the market with complicated extended release formats. The generics for these are NOT easy to make (correctly). So the chances that you will have a drug go off patent and it be an easy to make immediate release drug is a much smaller universe than even 10 years ago.
There are already issues with plenty of psychiatric drugs like concerta and Wellbutrin where the generics have been pretty much been proven (or there are a lot of anecdotal reports) to not be biologically the same as the brand name. This shows either the difficulty in making these - or their total incompetence - or lack of meaningful regulations. I suspect it is the first and third…
DataX, thank you, but just to be clear, I’m not asking because I have a problem or need to buy some fast. I’m just curious.
That’s why I said “almost”. To allow the room for profit, and taking out money for the distributor and pharmacy retailers. 
Right. I guess I was just wondering about how much of the cost went to cover expenses and how much left over was profit, but I guess it’s too complicated a question. For example there’s paying back the research Joey P mentioned (although since it was patented 13 years ago I think they’ve more then made back their money since then).
And since it’s selling in the UK for £26 ($41.89) that could either mean that it could sell in the US for $42/10ml and still make a profit, or the UK is forcing them to sell at a loss and they need to jack the prices up in the US to make it up.
It isn’t. Hopefully this chart will answer it for you:
That’s pretty interesting. Thank you.
Well, they have to pay for the research on this drug, pay for the start up costs, make some profit AND pay for all the research on all the failed drugs along the way as well as come up with seed money to get them all they way through to the next drug that makes it to market.
So, the those 10 vials may have cost AZ $100 from they day someone dreamed them up until the day they showed up in the pharmacy, they still might have to charge $350 because of everything else that never sees the light of day that they still spend millions on. The fact that you get to take this drug is because there was an expensive drug before it that they used they reinvested the profit from to seed the project that became this (that makes sense, right?).
The drug companies claim that the average research cost of a new drug is close to $900 million.
In addition, U.S. companies account for a wildly disproportionate percentage of all new drugs.
http://pipeline.corante.com/archives/2010/11/09/where_drugs_come_from_by_country.php
And since the U.S. is a very rich and populous country, guess what–we pay for that research on the retail end.
Right.
It’s important to distinguish average cost from marginal cost. Producing a few extra vials might cost them very little, but they do have to amortize other costs.
On the 'Web I find a cost breakdown (for their entire product line, not a specific drug) for 2002 supplied by Pfizer itself:
28% Profits
26% General and Administrative
16% Research and Development
13% Cost of Goods
8% Corporate Income Taxes
7% Advertising
2% All Other Expenses and Adjustments
It’s widely held that pharmaceutical companies spend more on promotion than on R & D, so I assume many such expenses are classified as “Development” or “COG.”
One need not join the Communist Party to compare the R & D and Profit figures reported by Pfizer itself and wonder if the self-pitying “huge risks … huge research costs” comments from Big Pharma are exaggerated.