from the identical-drug-Synacthen-in-Canada-costs-about-$33 dept.
Television station WSB-TV 2 in Atlanta, Georgia reports Metro city sues drug manufacturer over '97,500% price increase' for seizure medicine:
The city of Marietta, Georgia is suing drug manufacturer Mallinckrodt after Mallinckrodt increased the price of the drug Acthar by 97,500%.
"Acthar used to cost $40, but Mallinckrodt has raised the price of the drug to over $39,000 per vial," the city claims in its lawsuit. "This eye-popping 97,500% price increase is the result of unlawful and unfair conduct by Mallinckrondt. The City has expended over $2 million for just one patient covered by the city's self-funded health plan."
Atlanta pharmacist Ira Katz said Acthar is what's called a "biologic" and they can be classified as specialty drugs.
"They put them into the specialty class, and the prices are outrageous, just outrageous," Katz said.
The company sent a response to the station's request for comment. In part, it states:
In 2017, Mallinckrodt specifically offered to work with representatives for the City of Marietta in response to inquiries the City had made about the price of Acthar. The City declined to meaningfully participate in that process.
"Mallinckrodt acquired Acthar in August 2014, well after the price increase you reference in 2007 was undertaken by Questcor, the previous owner of Acthar. Under our stewardship, any price adjustments to Acthar have been limited to the mid-single digit percentage range. We want to help ensure patients have access to and can benefit from our therapies. That's why we offer significant discounts to many payers and customers, which the prior owner did not. Additionally, Mallinckrodt offers a range of robust free drug and commercial copay assistance options for patients, in compliance with applicable laws.
Apparently, there is a long history of complaints about the pricing for Acthar. See, for example, this December 2016 story in The New York Times. Here's another where CBS' 60 Minutes did an investigation. Then there are these two June 2018 stories from CNN. The focus of the first story is an overview of this drug's price and history. The second story has as its focus the impact on a single child and his family.
(Score: 5, Insightful) by c0lo on Tuesday February 18 2020, @09:31AM (31 children)
Lean, mean, profit extracting machine... it can't be wrong, it delivers value for the stakeholders by the most cost effective way, the quintessential duty of any responsible enterprise.
Why don't you simply love it? Capitalism is the universal panacea to all the bad things of this world!
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 5, Insightful) by loonycyborg on Tuesday February 18 2020, @10:42AM (22 children)
Free market competition is part of capitalism, yet it's clearly absent in this case. That drug is obsolete for its intended purpose but ended up effective for treating unrelated condition somehow. So they reclassified it as niche and increased price by 100000%. Since its mechanism for working is unknown it is hard to establish meaningful competition for now. Eventually generics will appear and other alternatives will be discovered dropping the price but for now this leads to delays in treatment. So the core issue is monopoly, I find it hard to believe that a drug made from some hormones extracted from pigs would cost so much without it.
(Score: 2) by c0lo on Tuesday February 18 2020, @10:50AM (18 children)
Absent, you say. Somehow, you say.
The translation: "if there's no opportunity to profit, then it doesn't matter if the drug (mysteriously and without doubt) does help some and the cost producing it is small**, capitalism is not going to bother to do something. Because, you know?, profit or GTFO".
** see the dept line
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 5, Insightful) by loonycyborg on Tuesday February 18 2020, @11:01AM (13 children)
Capitalism by itself is more of religious doctrine than anything else. It's widely known that efficiency and growth of market economy is driven by competition leading to dropping price and disruptive innovation. Yet also it's seen as part of capitalism to see it desirable to become a rich monopolist/oligarch. Those two ideas are inherently contradictory so would be out of place in a serious science. Yet it's just how religion works.
(Score: 2) by c0lo on Tuesday February 18 2020, @11:45AM
Argued but not proven - yes, I think I can see the point of capitalism is sort of a system of beliefs.
It's not like the wellbeing is necessarily driven only but the efficiency (thus competition) and not like competition alone guarantees efficiency.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @01:53PM (4 children)
what you say is correct. unfortunatly capitalist aren't stupid and know this too.
so to avoid competition a capitalist will try to use the clubbermint to protect "unfair competition".
if all goes well for the capitalist, that is the ties between capitalist and clubbermint are good, we end up with faschism.
the capitalist "suggests" laws and policies (for a kickback fee) to the "elected" clubbermint.
if the ties are abit dodgy then we get clubbermint owned and run so-called public companies (the logic being that clubbermint is public thus for profit companies owned by clubbermint are public) that belong to the treasury and are run for profit ... turning the clubbermint into one big self governed corporation...
(Score: 2) by DeathMonkey on Tuesday February 18 2020, @07:15PM (3 children)
Simply buying the competition is much easier.
(Score: 3, Insightful) by sjames on Tuesday February 18 2020, @10:15PM (2 children)
Mallinckrodt did exactly that already. They bought the rights to a cheaper synthetic and shelved it.
The problem is that any new player in the market will have to treat the decision as if the market price will be somewhere below $40/vial (about where it would fall once even basic competition gets started). But without that second source, the price is a thousand times that.
That's the perfect case for government intervention, but it stands on the sidelines singing "Free Market Uber Alles" in spite of the lack of an effective market in this case.
(Score: 2) by PocketSizeSUn on Thursday February 20 2020, @07:50PM (1 child)
Hmmm ... well billionaire douchebags like Bill G. could open a 501(c) for these kinds of cases. He's already heavy into pharma and IP ...
(Score: 2) by sjames on Friday February 21 2020, @12:09AM
But he hasn't. And neither has anyone else.
(Score: 4, Insightful) by FatPhil on Tuesday February 18 2020, @02:18PM (3 children)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by loonycyborg on Tuesday February 18 2020, @06:01PM (2 children)
This analogy is flawed since my original point was about underlying moral imperative of people, not about laws of physics that determine which actions are within realm of possibility. Which you prefer to exist? Competitive market or single monolithic structure with you doing all decisions directly or indirectly? This is two totally different worldviews and if you think that as soon as you achieve dominant position by taking advantage of the free market any rational need for said free market magically disappears then your worldview is bordering on solipsism. Yet this is how goals of a business are seen by most people nowadays, at least on ideological level.
(Score: 1, Redundant) by FatPhil on Wednesday February 19 2020, @09:45AM (1 child)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by loonycyborg on Wednesday February 19 2020, @10:29AM
Well then you can consider capitalism to be about flooding entire earth to become one big ocean while extolling relative benefits of lakes and rivers.
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @02:33PM (1 child)
Capitalism doesn't seems to be operating as a free market in this case as it operates on a state mandated monopoly through patents. No one is allowed to compete. If that system is undesireable, it would require adjusting the system. In my experience capitalism is not really good at progress in itself. The areas that make progress seems to be those that a state drops a pile of money on, either making companies fight as a flock of pirahnas to get the cash or a company is selected as the best candidate in a competing bid. If you want things done, capitalism seems to have no effect on that, but only serve as the machine performing tasks, the initiative comes from the state or in effect society for those who have negative connotation on the word state and government, justified or not. I think disruptive is a myth and at best a confusing concept. If we consentrate it down to someone who finds a more efficient way of doing things, that's great and it's how things always worked in competition, but as I've seen the word distruptive used it's a random ideafactory wasting a lot of resources.
(Score: 2) by c0lo on Wednesday February 19 2020, @12:38AM
FYI, the synthesis and safety of adrenocorticotropic hormone [wikipedia.org] (which is the active substance in Acthar and Synacthen) is no longer under the protection of a patent, nor does it need to pass the FDA certification.
So, in this particular case:
- no patent monopoly
- no high barrier of entry to justify increased prices to cover the certification cost.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 1) by khallow on Tuesday February 18 2020, @07:28PM
Only if the two ideas were held by the same sincere being. Welcome to conflicts of interest.
(Score: 2, Insightful) by khallow on Tuesday February 18 2020, @03:54PM
Amazing how that works right? No competition - crazy prices. It'll like a pattern or something.
Makes you wonder why there isn't an opportunity for profit by anyone else when someone is selling a drug for 3 orders of magnitude more than it costs to manufacture. Guess US regulators (and perhaps others in the world) are protecting us from cheap, less profitable medicines.
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @06:42PM
It's nice that GTFO here has a concrete value: move to Canada.
Maybe I should try that before being prescribed something that cost's ~annual-salary/dose ...
(Score: 5, Insightful) by Mykl on Tuesday February 18 2020, @10:57PM (1 child)
Just a reminder for all our brainwashed citizens - the US is not a free market capitalist economy!
Pure market capitalism only operates with homogeneous products, identical location, buyers and sellers having perfect knowledge of the market conditions, equal access to resources for suppliers etc
Things that exist in the US that distort Market Capitalism are:
The existence of any of these elements distorts the 'perfect market', meaning that you can't just rely on self-regulation.
(Score: 2) by c0lo on Wednesday February 19 2020, @12:43AM
Just as a reminder for whoever is tempted by the idea of a "free-market capitalist economy" - it is an utopia, pretty much in the same category as communism.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 3, Informative) by sjames on Tuesday February 18 2020, @06:21PM (2 children)
It's beyond that. The manufacturer bought the rights to a synthetic equivalent with the intent to shelve it in order to maintain the monopoly. The courts ordered them to license those rights. Somehow still nobody is competing in spite of a ready opportunity for a high margin product.
The problem is that it would be high margin but low demand.
It is quite simply a corner case where market forces are ineffective. We can either recognize that and fix it, or we can continue to beat ourselves over the head with our own ideology.
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @07:16PM (1 child)
If someone competed, they would drop the price again and undercut their competitors until they went under. Then the price would be raised once again. Thus there's no point to licensing those rights as you'll be going bankrupt right after you sell your first batch.
(Score: 2) by sjames on Tuesday February 18 2020, @07:40PM
Right. Thus my comment that it's time to admit that Capitalism isn't all things to everyone, the ultimate panacea. This is one of those corner cases that needs another answer.
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @02:38PM (2 children)
No regular person (for the most part) could afford $39,000 per vial. This is exactly the opposite capitalism. The reason they're able to charge so much is because the government is getting involved in the market on behalf of the consumer. The government (again, for the most part) has relatively little interest in cost because they're spending other people's money. And so you get this nonsense.
It's the same reason you see things like Boeing doing rocket launches for half a billion dollars. It's because they were working, defacto, as a part of the government and in that case - all notions of supply and demand become grossly distorted.
(Score: 2) by c0lo on Wednesday February 19 2020, @12:40AM (1 child)
Have it crossed your mind that this is the best available solution, anything else would be no product on the market?
Like in: the niche is so narrow that no profit oriented organization would ever think to serve the needs of that niche.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 0) by Anonymous Coward on Wednesday February 19 2020, @05:19AM
You're letting ideology cloud your logic. The article itself states that the drug was previously sold for $40. After the government gets involved, it's now sold for $40,000 per vial.
This is a textbook example of the dangers of trying to "fix" a free market.
(Score: 3, Interesting) by Bot on Tuesday February 18 2020, @02:39PM (1 child)
The model called capitalism implies a free market and honest players.
The free market is already out once you talk about patents.
Honest players is already out once you talk about people profiting from the health of others.
So, even if capitalism is an equivalent fairy tale of communism indeed, you are OT.
Account abandoned.
(Score: 2) by c0lo on Wednesday February 19 2020, @01:14AM
By your implication, perhaps.
The reality, however, tends to abhors Bot dreams, those of electric sheep included.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 2) by DannyB on Tuesday February 18 2020, @04:49PM (1 child)
There is a simple reason for this modest hundred-thousand percent price increase: Health Insurance, a magical unlimited pile of money in the sky!
The lower I set my standards the more accomplishments I have.
(Score: 3, Interesting) by c0lo on Wednesday February 19 2020, @12:48AM
Yes, because greed is a virtue, indeed.
In other words the greedy is absolutely innocent, has done nothing wrong, it is the socialized health care** that is the supreme evil.
** Health Insurance, even if private, is still in the "spreading the costs and risks between the participating members" class of solutions - that's kinda "socializing" (as opposed to "individualizing")
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @11:45PM
Free market capitalism doesn't have patents. Patents are the opposite of free markets.
It's similar to the high prices of insulin result from evergreening. They use patents on newer variants to keep prices inflated.
(Score: 5, Interesting) by FatPhil on Tuesday February 18 2020, @11:43AM (9 children)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by ikanreed on Tuesday February 18 2020, @01:38PM (7 children)
There's definitely a constitutional crisis brewing in that voters in cities aren't having their views fairly represented in the federal government and the only sane way to respond is to stop concerning yourself with federal law. It's not as immediate as some other crises, but it's gonna bubble over sooner or later.
(Score: 2) by FatPhil on Tuesday February 18 2020, @02:12PM (6 children)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by ikanreed on Tuesday February 18 2020, @02:36PM (5 children)
"States' rights" is, on a fundamental level, an absurd phrase, exactly like "corporate personhood". As if rights were something you could derive from having borders, equated to a universal value assigned to preserve human dignity. It's surreal.
I shouldn't get too held up on language, but the concept they actually want to promote is "state sovereignty"
(Score: 2) by FatPhil on Tuesday February 18 2020, @11:56PM (4 children)
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by ikanreed on Wednesday February 19 2020, @03:42PM (3 children)
Fffffffffffffffuuuuuuuuuccckk that.
A right can be protected simply because one person sees another person being mistreated and stands up for them. In the moment. There's no need for some divine right of kings leviathan to descend from heaven and mandate it. That's some serious authoritarian bullshit.
Where there are power structures, we all should demand they protect the rights of all people, because that's where abuse is most likely to come from, but there's no need for a better protecting their lesser like a goddamn questing paladin following a chivalric code. That's how a child reasons.
(Score: 2) by FatPhil on Wednesday February 19 2020, @10:54PM (2 children)
Nope. You are using a US-biased version of the word which has no historical (by which I mean over a timespan of the development of the language, four times as ong as your laughably brief "US history") support. Having said that, there are explicit examples of how out of touch your view is in your own brief history: would the "rights" in the Bill of Rights have been "rights" if they weren't explicitly listed in the Bill or Rights? Play a little game before responding, try to guess what my response will be to both a "yes", and a "no", answer (it's a yes/no question).
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by ikanreed on Thursday February 20 2020, @03:17PM (1 child)
That's a meaningless and nearly incoherent jumping from idea to idea without a central point.
The right to marry who you choose is a universally recognized right within this country. Not listed in the bill of rights, implicitly understood to be true(though some fought stupidly long about whether it applied to gay people), and has jack shit to do with the right being granted by a superior.
Your worldview sucks.
(Score: 2) by FatPhil on Friday February 21 2020, @09:42AM
> universally ... within this country
So, across the whole universe.
But only in one country.
That's a pretty big plank blocking your vision.
Also, consider what you have implied by your use of the phrase "it applied" in your prior post.
> Your worldview sucks.
I have made no statements at all about my worldview. I have made provably factual statements about language, and fairly standard (e.g. Bentham, Mill) statements from the field of the philosophy of rights. The mere fact that you think I've said anything about my worldview shows that your handle on this site is woefully inaccurate.
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 1, Funny) by Anonymous Coward on Tuesday February 18 2020, @02:37PM
Oh no not illegal matter! Those molecules are bad!
(Score: 2) by SomeGuy on Tuesday February 18 2020, @12:03PM (5 children)
Unfortunately the only lesson that will be learned here is "don't charge more than the lawyers". :P
The health care system in this country is sick. These days, if you go in to the hospital for anything serious you can expect to have to sell your house. And that is even if you already use most of your paycheck to pay their monthly protection monies.
(Score: 2, Insightful) by Anonymous Coward on Tuesday February 18 2020, @12:32PM (2 children)
This is hilarious: https://www.whitsundaytimes.com.au/news/americans-lose-it-over-aussies-money-plan/3946914/ [whitsundaytimes.com.au]
(Score: 1, Informative) by Anonymous Coward on Tuesday February 18 2020, @12:42PM
And the actual cost of a 3 month supply is closer to $3-$5, without splitting, that's with profit. That's the price in developing countries, just north of Australia.
Australia doesn't have "cheap" - it already has a fucking huge profit margin for everyone around. The prices in the US are just fucked up completely. It doesn't mean other developed countries have it cheap either, but at least a more fairer price.
(Score: 0) by Anonymous Coward on Wednesday February 19 2020, @12:52AM
So.. are you advocating the public pay for health insurance or health management?
Or not pay for anything health related?
:-)
(Score: 4, Interesting) by JoeMerchant on Tuesday February 18 2020, @03:20PM
Epilepsy is a particularly vulnerable target, since cost of care can easily exceed $100K per year per patient. Any effective treatment can therefore be billed out at up to that rate and touted as "cost effective."
I worked for an epilepsy device maker who claimed 33% efficacy (though, their detractors claimed they had more like 3% efficacy) - in any event, the device cost $600 to manufacture, but by the time it was implanted in a patient the cost to the insurers was $30K+ increasing all the time due to the "value proposition" that there was payback to the system in less than 1 year.
🌻🌻 [google.com]
(Score: 2) by krishnoid on Tuesday February 18 2020, @10:39PM
I mean, if you read "Acthar" and don't immediately think, "it's probably a trap", how is learning any *new* thing going to improve the situation?
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @01:58PM
they should just use the law to limit drug prices. to make up for lost profits they could fast track more leaky nuke reactor. afterall, nukes dont kill people outright as is mentioned over and over ... but bare suggesting nukes are healthy the long term damage of radiation should divert a pretty penny into pharmas coffers ...
(Score: 3, Interesting) by mobydisk on Tuesday February 18 2020, @03:32PM (1 child)
These articles about drug prices are rambling and incoherent. It's hard to come to a decision. I hope the lawsuit exposes some details better than the dead-end investigations.
The 60-minutes article doesn't provide enough information to piece together what happened. Company A bought Company B. Company A increased the price $8,000. Company B had already increased the price tens of thousands of dollars. But neither company had any explanation. And there's no basic sales information either: nothing about how much of the drug was sold, revenues, profits, manufacturing costs - nothing.
If you were going to price gouge, you wouldn't raise the price a thousand fold in one day. You would do it by 5% a year or something, and publicly blame regulation. This stuff just doesn't pass a common-sense test.
The article goes on to talk about the FDA approval, which happened in 1952 - so that's not the cause. There's nothing about patents. Then it talks about a company "Express Scripts" that didn't negotiate a better price, but they got no comment from the company as to why. It's just dead-end after dead-end. This should be straightforward business economics. Why can we not figure this out?
We all get very upset about drug prices, yet I can't find a coherent article explaining the problem. 9 times out of 10 when someone complains about something like this, it's because they don't understand what is going on economically. But when the companies clam-up about it, we have no choice but to assume they are crooks.
(Score: 0) by Anonymous Coward on Tuesday February 18 2020, @06:12PM
https://www.ajc.com/news/local/marietta-sues-drug-company-over-medicine-that-went-from-000/QB2iFp5ejKQ9fzbZQKYCSI/ [ajc.com]
(Score: 1, Funny) by Anonymous Coward on Tuesday February 18 2020, @06:52PM
please have some consideration for poor CEOs.
(Score: 1, Insightful) by Anonymous Coward on Wednesday February 19 2020, @03:56AM
Mallinckrodt is incredibly unethical. My dad worked in the downtown St. Louis plant for decades before losing his job in a layoff. After the layoff, they refused to give a reference even saying he worked there, effectively blacklisting him from working in the pharmaceutical industry for several years. He absolutely despised Mallinckrodt and frequently talked about the unethical and dishonest practices he saw in the labs. He was always concerned about shoddy quality control practices involving their pharmaceuticals and whether the products could be dangerous, but didn't have the proof he needed to go to the FDA and ensure they would be able to substantiate the allegations. I have little doubt he also was concerned about the effects on his family if he chose to be a whistle blower. From everything I've heard, from someone who worked in the St. Louis plant for a long time, they're an incredibly nasty company. It is not surprising at all that they've chosen to be greedy and unethical in the situation as well. Fuck Mallinckrodt. I hope they get put out of business.