Feelin’ the Love from Big Pharma

Aug
29

I am linking to a fascinating article inMIT Technology Review by Barry Werth entitled “A Tale of Two Drugs.” The article sheds light on how Big Pharma justifies their pharmaceutical costs and it concludes that we are facing a future where extremely costly drugs are commonplace.

There are several revealing themes the author puts forth:

Patients/Physicians are not Big Pharma’s customers; Big Insurance is;
Prices are inelastic, meaning they are set by “feel” to what the market will bear;
Lack of competitive alternatives is the biggest driver of drug costs;
Stakeholders make profits treating sick people regardless of how little value is added to society;
The U.S., with 5% of the population, buys 50% of the world’s pharmaceuticals.