from the sudden-outbreak-of-common-sense? dept.
Health systems representing around 500 U.S. hospitals have formed a not-for-profit pharmaceutical manufacturer called Civica Rx. The drugs will be cheap, and the CEO will not receive a paycheck:
A drugmaking venture backed by major U.S. hospitals has picked a chief executive officer, hastening the arrival of another threat to generic pharmaceutical manufacturers.
Martin VanTrieste, 58 and a former top executive at biotechnology giant Amgen Inc., will run the organization, a not-for-profit called Civica Rx. Dan Liljenquist, 44 and an Intermountain Healthcare executive, will be chairman. Health systems with a total of about 500 hospitals -- including Intermountain, HCA Healthcare Inc., Mayo Clinic and Catholic Health Initiatives -- will help govern the venture, alongside several philanthropies.
Civica Rx will work to combat drug shortages and skyrocketing prices for some treatments given in hospitals by manufacturing generics or contracting with other firms to make them. Generic drugmakers have faced scrutiny for raising the prices of certain older drugs, particularly when hospitals lack alternatives. The supply chain for such treatments has also been vulnerable to disruptions, leading to persistent shortages.
"Civica Rx will first seek to stabilize the supply of essential generic medications administered in hospitals," the group said in a statement. "The initiative will also result in lower costs and more predictable supplies of essential generic medicines."
The venture, announced by Intermountain in January, said it plans to have its first products ready by as early as next year. It's focused on a group of 14 drugs given in hospitals, but a spokesman for the group declined to identify them. Liljenquist said that the drugs are in categories such as pain relief, antipsychotics, antibiotics and cardiovascular treatments, including drugs that are stocked on so-called crash carts used in emergencies.
Also at NPR, CNBC, The Washington Post, and Forbes.
Related: The Cheerios Theory of Branded Medicine
Mylan Overcharged U.S. Government on EpiPens
Martin Shkreli Points Fingers at Other Pharmaceutical Companies
Amazon, Berkshire Hathaway, and JPMorgan Chase to Offer Their Own Health Care to U.S. Employees
Analysts Question Whether Curing Patients is a Sustainable Business Model
FDA Has Named Names of Pharma Companies Blocking Cheaper Generics [Updated]
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It has the same active ingredient, so it should work the same, but if someone says 'I want Cheerios, not Walmart-os', then why should they not get what they're paying for? (David Maris, pharmaceuticals analyst at Wells Fargo, as quoted in Staying Power, David Crow, Financial Times [Log in required], Aug 22.
Discovering a drug and bringing it to market can take more than 10 years and costs on average $2.6bn per medicine. Typically around five to seven years after, the exclusive rights on the discovery expire, and generic copycat versions quickly flood the market. Prices are slashed to super-cheap, and then for all time and eternity, society benefits greatly. Or, in the words of Pfizer's CEO Ian Read during an investor call: "The price of medicines drop significantly once the patent expires... Today, about nine out of ten prescriptions in the US offer generic drugs, which lead to significantly reduced costs in the healthcare system."
A recent Financial Times analysis doesn't completely agree though. Prices of branded medicines aren't slashed once the patent expires. They actually often sharply increase.
Before companies get to that phase however, a whole slew of other tactics have been used to maintain exclusivity. Many make small changes to a drug, then renew the patent. This is known as evergreening. Others "pay for delay" -- offering financial incentives to the generics producers to bring their alternatives to market more slowly. And once the generics get to market, pharma companies change tactics by attempting to stop patients, doctors and pharmacists from switching.
The end result is price differences between generics and brand medicines which are somewhat strange for a free market: Wellbutrin (bupropion, 150 mg) [Valeant]: $36 per pill versus $0.46 for the generic [bupropion]; Lipitor (atorvastatin 20mg) [Pfizer] 10.49 versus 0.13, Abmien (zolpidem 5mg) [Sanofi] 15.52 versus 0.02, Prozac (fluoxetine 20mg) [Eli Lilly] 11.39 versus 0.03, Xanax (alprazolam 1mg) [Pfizer] 8.14 versus 0.05 and Sarafem (fluoxetine 20mg) [Allergan] $15.98 versus $0.03 per pill.
There must be lot of people who prefer Cheerios over Walmart-os.
If you're going to overcharge the U.S. government, you don't want to get caught:
Mylan NV for years overcharged the U.S. Medicaid health program to buy its EpiPen shot, the government said Wednesday, despite being told that it needed to give bigger discounts under the law. From 2011 to 2015, the joint state-federal program for the poor spent about $797 million on EpiPens, the Centers for Medicare and Medicaid Services, or CMS, said in a letter Wednesday. That included rebates of about 13 percent, but the U.S. should have been getting a larger discount of at least 23.1 percent.
While the agency didn't say exactly how much Mylan had overcharged, the amount could be substantial. Under law, companies are required to give [Medicaid] back any price increases they take on brand drugs above the rate of inflation, in addition to the 23.1 percent discount. Mylan, after acquiring the drug in 2007, has raised the price of EpiPen by about sixfold, to over $600 for a package of two. The government has in the past "expressly told Mylan that the product is incorrectly classified," CMS said in the letter, which came in response to an inquiry by Congress. "This incorrect classification has financial consequences for the amount that federal and state governments spend because it reduces the amount of quarterly rebates Mylan owes for EpiPen."
Previously:
EpiPen's Price Increased 400% since 2008
AllergyStop: $50 EpiPen is Production-Ready but...
Martin Shkreli, the former CEO of Turing Pharmaceuticals AG, has launched a list to shame other pharmaceutical companies:
This week, a pharmaceutical trade group stepped up its efforts to distance itself from Martin Shkreli, the disgraced ex-CEO of several drug companies who gained notoriety for an eye-popping drug price increase and an indictment for securities fraud. The trade group even made a television ad to try to bolster its image and make clear that it is different—better—than the likes of Shkreli and his greedy ways.
Is it, though? If you ask Shkreli, it's not. And he's made a website to try to convince you.
On the bare-bones Pharmaskeletons.com, an angry and vengeful Shkreli lists instances of greed, criminal behavior, and other sleaziness of individual members of the pharmaceutical trade group PhRMA. Not all his claims are backed up, explained, or accurate. But the site still offers an embarrassing catalogue of bad deeds, which Shkreli told STAT he would continually update.
Amazon, Berkshire Hathaway and JPMorgan Team Up to Disrupt Health Care
Amazon, Berkshire Hathaway and JPMorgan Chase announced on Tuesday that they would form an independent health care company to serve their employees in the United States. The three companies provided few details about the new entity, other than saying it would initially focus on technology to provide simplified, high-quality health care for their employees and their families, and at a reasonable cost. They said the initiative, which is in the early planning stages, would be a long-term effort "free from profit-making incentives and constraints."
The partnership brings together three of the country's most influential companies to try to improve a system that other companies have tried and failed to change: Amazon, the largest online retailer in the world; Berkshire Hathaway, the holding company led by the billionaire investor Warren E. Buffett; and JPMorgan Chase, the largest bank in the United States by assets.
Various health insurance and pharmacy companies were hit by the news:
The move sent shares of health-care stocks falling in early trading. Express Scripts Holding Co. and CVS Health Corp., which manage pharmacy benefits, slumped 6.7 percent and 5.5 percent, respectively. Health insurers Cigna Corp. and Anthem Inc. also dropped. The health-care industry has been nervously eyeing the prospect of competition from Amazon for months. While the new company created by Amazon, Berkshire and JPMorgan would be for their U.S. staff only, this is the first big move by Amazon into the industry. The new collaboration could pressure profits for middlemen in the U.S. health-care supply chain.
Related: $54 Billion Anthem-Cigna Health Insurer Merger Rejected by U.S. Judge
CVS Attempting $66 Billion Acquistion of Health Insurer Aetna
One-shot cures for diseases are not great for business—more specifically, they’re bad for longterm profits—Goldman Sachs analysts noted in an April 10 report for biotech clients, first reported by CNBC.
The investment banks’ report, titled “The Genome Revolution,” asks clients the touchy question: “Is curing patients a sustainable business model?” The answer may be “no,” according to follow-up information provided.
[...] The potential to deliver “one shot cures” is one of the most attractive aspects of gene therapy, genetically engineered cell therapy, and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies... While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.
[...] Ars reached out to Goldman Sachs, which confirmed the content of the report but declined to comment.
Submitted via IRC for Runaway1956
Update 5/17/2018: The FDA has now launched the website listing the names of brand name drugs and their makers who have stood in the way of generic drug companies trying to make more affordable alternatives. You can view the list here. It includes notable medications, such as Accutane (for acne), Methadone (used for opioid dependency), and Tracleer (to treat high blood pressure in the lungs). The brand name drug makers to be shamed includes big hitters such as Celgene Corp, GlaxoSmithKline, Pfizer, Valeant Pharmaceuticals International, Gilead Sciences Inc, and Actelion Pharmaceuticals Ltd, now a Johnson & Johnson company. Our original story, published May 16, is unedited below.
The Food and Drug Administration plans this week to effectively begin publicly shaming brand-name drug companies that stand in the way of competitors trying to develop cheaper generic drugs.
FDA Commissioner Scott Gottlieb told reporters on Monday and Tuesday that the agency will unveil a website on Thursday, May 17 that names names of such companies. More specifically, the website will publicly reveal the identity of 50 branded drugs and their makers that have blocked generic development. The website will also be updated "on a continuous basis" to list additional names.
In fielding questions from reporters, Gottlieb denied that the effort was a form of public shaming. "I don't think this is publicly shaming," Gottlieb said, according to S&P Global Market Intelligence. "I think this is providing transparency in situations where we see certain obstacles to timely generic entry."
Martin Shkreli continues to run business from prison, report says
Martin Shkreli reportedly runs his pharmaceutical company from prison on a contraband smartphone. Shkreli continues to run the remains of the drug company that once earned him the title of most hated man in America, according to a story in the Wall Street Journal. He was convicted of securities fraud and conspiracy in 2017. He has served 16 months of a seven-year sentence in federal prison.
Shkreli is reportedly running Phoenixus AG, formerly known as Turing Pharmaceuticals. In 2015, when Shkreli was the CEO, Turing raised the price of the lifesaving drug Daraprim used by AIDS patients from $13.50 a pill to $750 a pill. The price hike sparked a public outcry.
The Journal says that Shkreli anticipates the company will grow more successful while he's in prison. He believes the company, of which he owns 40%, could be worth $3.7 billion by the time he gets out of prison.
On one recent phone call, Shkreli fired Phoenixus CEO Kevin Mulleady, the Journal reported. Shkreli reportedly later changed his mind, agreeing to suspend Mulleady rather than fire him.
Cartoon villain performance art.
Previously: Martin Shkreli Points Fingers at Other Pharmaceutical Companies
Martin Shkreli Convicted of Securities Fraud Charges, Optimistic About Sentencing
Martin Shkreli Lists Unreleased Wu-Tang Clan Album on eBay
Martin Shkreli's $5 Million Bail Revoked for Facebook Post Seeking Hillary Clinton's Hair
Sobbing Martin Shkreli Sentenced to 7 Years in Prison for Defrauding Investors
Related: Drug Firm Offers $1 Version of $750 Turing Pharmaceuticals Pill
Mylan Overcharged U.S. Government on EpiPens
EpiPen Maker is Facing Shareholder Backlash
FDA Has Named Names of Pharma Companies Blocking Cheaper Generics [Updated]
U.S. Hospitals Band Together to Form Civica Rx, a Non-Profit Pharmaceutical Company
Infamous ex-pharmaceutical executive Martin Shkreli is yet again in trouble with the Federal Trade Commission, which announced today that the convicted fraudster has failed to cooperate with the commission's investigation into whether he violated his lifetime ban from the pharmaceutical industry by starting a company last year called "Druglike, Inc."
[...]
At the center of the dispute is whether Shkreli's co-founding of Druglike runs afoul of his lifetime ban from the pharmaceutical industry, which was in response to Shkreli's infamous move to raise the price of the cheap, life-saving anti-parasitic drug, Daraprim, from $17.50 a pill to $750 a pill in 2015.
[...]
The FTC also noted in its court filing that Shkreli has so far failed to pay any of the $64.6 million in disgorgement he was ordered to pay alongside his lifetime ban.
Previously:
Martin Shkreli Launches Blockchain-Based Drug Discovery Platform
Martin Shkreli Accused of Running Business From Prison With a Smuggled Smartphone
Sobbing Martin Shkreli Sentenced to 7 Years in Prison for Defrauding Investors
Martin Shkreli's $5 Million Bail Revoked for Facebook Post Seeking Hillary Clinton's Hair
Martin Shkreli Lists Unreleased Wu-Tang Clan Album on eBay
Martin Shkreli Convicted of Securities Fraud Charges, Optimistic About Sentencing
Martin Shkreli Points Fingers at Other Pharmaceutical Companies
Related:
U.S. Hospitals Band Together to Form Civica Rx, a Non-Profit Pharmaceutical Company
FDA Has Named Names of Pharma Companies Blocking Cheaper Generics [Updated]
EpiPen Maker is Facing Shareholder Backlash
Mylan Overcharged U.S. Government on EpiPens
Drug Firm Offers $1 Version of $750 Turing Pharmaceuticals Pill
In an effort to avoid being held in contempt of court, former pharmaceutical executive and convicted fraudster Martin Shkreli made an eyebrow-raising argument to a federal judge Friday, stating that his company Druglike, which he previously described as a "drug discovery software platform," was not engaged in drug discovery. As such, he argued he is not in violation of his sweeping lifetime ban from the pharmaceutical industry.
Last month, the Federal Trade Commission and seven states urged a federal judge in New York to hold Shkreli in contempt for allegedly failing to cooperate with an investigation into whether he violated the ban. The FTC said Shkreli failed to turn over requested documents related to Druglike and sit for an interview on the matter.
In the filing Friday, Shkreli claims that he responded to the FTC's requests "promptly and in good faith."
Previously:
FTC: Shkreli May Have Violated Lifetime Pharma Ban, Should be Held in Contempt
Martin Shkreli Launches Blockchain-Based Drug Discovery Platform
Shkreli Released From Prison to Halfway House After Serving <5 of 7 Years
Martin Shkreli Accused of Running Business From Prison With a Smuggled Smartphone
Sobbing Martin Shkreli Sentenced to 7 Years in Prison for Defrauding Investors
Martin Shkreli's $5 Million Bail Revoked for Facebook Post Seeking Hillary Clinton's Hair
Martin Shkreli Lists Unreleased Wu-Tang Clan Album on eBay
Martin Shkreli Convicted of Securities Fraud Charges, Optimistic About Sentencing
Martin Shkreli Points Fingers at Other Pharmaceutical Companies
Related:
"Pure and Deadly Greed": Lawmakers Slam Pfizer's 400% Price Hike on COVID Shots
U.S. Hospitals Band Together to Form Civica Rx, a Non-Profit Pharmaceutical Company
FDA Has Named Names of Pharma Companies Blocking Cheaper Generics [Updated]
EpiPen Maker is Facing Shareholder Backlash
Mylan Overcharged U.S. Government on EpiPens
Drug Firm Offers $1 Version of $750 Turing Pharmaceuticals Pill
(Score: 4, Funny) by Runaway1956 on Thursday September 06 2018, @10:17PM
You stole shit from some futuristic medical science fiction story, didn't you?
(Score: 2, Funny) by Anonymous Coward on Thursday September 06 2018, @10:21PM (1 child)
Shkreli gets out of prison and launches a hostile takeover of this puppy, turns it into a for-profit, raises prices 700% and uses profits to buy Wu Tang Clan.
(Score: -1, Offtopic) by realDonaldTrump on Thursday September 06 2018, @11:03PM
@MartinShkreli__ [twitter.com] is a spoiled brat. So is El Chapo. I LOCKED THEM UP. And they're not getting out for a long long time. Believe me!!!
(Score: 3, Funny) by bob_super on Thursday September 06 2018, @11:07PM (8 children)
Totally looking forward to affordable hospital bills !
(Score: 3, Interesting) by ChrisMaple on Friday September 07 2018, @03:03AM (7 children)
Often, hospital bills are dominated by highly skilled labor expenses. Keeping enough doctors and nurses and technicians around 24/365 so that there is never a shortage for even emergency conditions cannot be cheap. There are also expensive pieces of machinery to pay off, liability insurance, and lots of other overhead.
The markup that a hospital charges for drugs does seem excessive, but you're also paying for each pill to be individually documented and administered by a well-educated and conscientious nurse.
Cheaper generics will help, but don't expect this to make a big difference in hospital bills.
(Score: 2) by mhajicek on Friday September 07 2018, @03:54AM (2 children)
Don't forget liability insurance.
The spacelike surfaces of time foliations can have a cusp at the surface of discontinuity. - P. Hajicek
(Score: 0) by Anonymous Coward on Friday September 07 2018, @07:36AM (1 child)
Don't worry, they didn't :)
> There are also expensive pieces of machinery to pay off, **liability insurance**, and lots of other overhead.
(Score: 2) by Fluffeh on Monday September 10 2018, @02:45AM
I'm pretty sure you misread that. He said not to forget about the Liability Insurance =)
Cause that's like really expensive. Yeah, it's actually that pricey you might want to count it twice.
(Score: 3, Informative) by bzipitidoo on Friday September 07 2018, @11:36AM (2 children)
> The markup that a hospital charges for drugs does seem excessive
The markup _is_ excessive.
> but you're also paying for
And that's one of the problems. They've got to stop using that excuse, that they have to charge such high prices to offset vaguely mentioned, mysterious other expenses. Their charges should be related to their expenses. It's too easy to abuse that one, and oh, do they. Like, I've been told those prices are basically to subsidize the care of patients who can't (or won't) pay their bills.
> to be individually documented and administered by a well-educated and conscientious nurse
That so? Then what's the facility fee supposed to be for? Or, the entirely separate bill that the doctors charge for their services? And. what's so hard about documenting? Is it that they're still very primitive in their use of technology? They still ask patients to fill out paper forms, especially tedious when it's the same basic info, over and over. When I've asked them about that, they frequently resort to another of their favorite excuses, which is to blame it on HIPAA.
> Cheaper generics will help, but don't expect this to make a big difference in hospital bills.
You're right there. It's the "fee for service" business model that encourages such bill padding and waste.
My own experience is, I understand, typical. The hospital bill for 3 trips to emergency for a kidney stone was $21,000, of which the biggest single item was $9107 for a CAT scan. Health insurance cut that to about $4000. But, had I not had health insurance, I am told the hospital would have discounted their own price 88%, for a final total of about $2500. Medicare says the services I received were worth $269. Insurance and Medicare both agree that the CAT scan was worth only $189, but that was the only price they agreed upon.
If we want serious reform, we have to make them hurt. After a year of arguing and just trying to understand how the heck they arrived at the prices they charged -- health insurance call center employees were unable to explain various discrepancies in the bills and each time I called, they invented a different excuse-- I finally told the hospital that I did not agree with their prices or their billing practices and that I would not pay a penny more than $269. They refused to accept that, and I asked if they would prefer to be paid even less. They responded by turning it all over to debt collectors. I told the debt collectors to go away, and, as they are legally obliged to do so, they did.
Medical billing in the US is extremely corrupt. It's so bad that credit rating agencies finally sided with the public in deciding not to have medical debt counted against your rating the same as any other debt. Further, there are signs all over the hospital that announce that they are legally obliged to give you the care you need no matter what the status of your finances or any debts they feel you may have with them. Hmmm.
(Score: 3, Interesting) by bob_super on Friday September 07 2018, @04:54PM
Yup. Other developed countries mysteriously find ways to get you pill and care for a tiny fraction of the US hospitals' list prices... and yet have better outcomes.
I think the curve is interesting, with quality peaking at a reasonable cost, and going down as cost keeps rising to US levels. Well, except for the lack of points in between, so you have to use a log axis.
(Score: 2) by Fluffeh on Monday September 10 2018, @02:49AM
So... what you're saying is that the US doesn't have universal healthcare, but hospitals *have* to treat those that come in the door, so they in turn gratuitously over-charge people that do in fact come in to pay for others... You should totally switch to a universal healthcare system. It works so much better in the rest of the world where countries have it.
https://en.wikipedia.org/wiki/List_of_countries_with_universal_health_care [wikipedia.org]
*sips coffee*
(Score: 0) by Anonymous Coward on Friday September 07 2018, @11:46PM
My mother was charged 400 dollars to hand her, her own purse to get her own bottle of Tylenol out.
I can not wait until the hospitals have done what every other business hopes to do. Vertically integrate their own costs.
(Score: 0) by Anonymous Coward on Thursday September 06 2018, @11:33PM (3 children)
They probably have plans to knife the baby already. Can't have anyone cutting in on their profits.
(Score: 2) by takyon on Friday September 07 2018, @12:20AM (2 children)
The Pharma that makes new drugs and the Pharma that makes only generics are kind of separate.
I don't see them killing this.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 1, Insightful) by Anonymous Coward on Friday September 07 2018, @04:20PM (1 child)
What about the Pharma that endlessly "tweaks" the same drug just enough to get the patent renewed so the drug doesn't become a generic? Or the Pharma that hand out vacation trips to doctors if they prescribe certain drugs?
(Score: 2) by takyon on Friday September 07 2018, @05:54PM
That's both the first one. Although they do sell drugs that have become generic but are coasting on a trademark, such as Pfizer's Vi*gra and Bayer's Heroin... oops, I mean Aspirin.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by MichaelDavidCrawford on Friday September 07 2018, @12:09AM (3 children)
I wasn't out of my tree in April 1994, I was wandering the vast empty reaches of Intergalactic Space.
The hospital set me up with Risperdal, which had been licensed just a few months before. I described it to the nurses as "Like a breath of fresh air blowing through my mind".
I was paying $200 a month for it.
But it's patent expired somewhere around November of 2013. You can get the generic risperidone but I don't know what it costs.
I used to take the SSRI antidepressant Paxil, for $300 per month. It did nothing for me other than making it totally impossible to get my cookies.
My witch doctor changed me to imipramine, which was one of the very first tricyclic antidepressants. One month's supply set me back fifteen clams.
And it worked really well.
Yes I Have No Bananas. [gofundme.com]
(Score: 1, Informative) by Anonymous Coward on Friday September 07 2018, @02:30PM (2 children)
you are quite fucking mad, Sir.
(Score: 3, Touché) by takyon on Friday September 07 2018, @04:09PM
"You say that like it's a bad thing."
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by MichaelDavidCrawford on Friday September 07 2018, @07:20PM
I make my own fun.
Yes I Have No Bananas. [gofundme.com]
(Score: 0) by Anonymous Coward on Friday September 07 2018, @12:19AM
Wall St. Assholes are assholes, but they've got nothing on hospital/medical assholes.
(Score: 2) by jmorris on Friday September 07 2018, @01:25AM (7 children)
Non-profit vs for profit is not the problem. Non-profit usually performs poorer than for profit, although non-profits often outperform government run enterprises.
The problems they seek to address are not due to the profit motive or the marketplace, thus their premise being defective their failure is assured. They will get direct first hand knowledge of what the actual problems are as they fail, so as long as the people fronting the money for this misadventure do not mind seeing it flushed away it might indirectly do some good.
They will discover the joy of negotiating for liability insurance. They will discover the upfront costs to get FDA approval on drugs that don't move enough volume to justify it. And so on until it all falls down. But the primary goal is assured, everyone the self esteem of everyone involved will be totally jacked.
If any of these moralistic preening jackwagons REALLY believed the generic drugmakers were totally screwing up and could be beaten they would be raising capital to compete with them openly.
(Score: 3, Touché) by Anonymous Coward on Friday September 07 2018, @01:41AM
Triggered, jmorris?
Afraid they will actually succeed? Think of it as COMPETITION, something free market types are supposed to adore.
(Score: 4, Insightful) by sjames on Friday September 07 2018, @02:08AM (4 children)
Considering that they're targeting the most commonly used hospital drugs, part of your premise fails on it's face.
The rest is just hand waving backed by no reasoning, just bald unproven statements.
(Score: 2) by jmorris on Friday September 07 2018, @02:35AM (3 children)
Yeah, remember that most of what one read in the legacy media is misinformation, misinformed or outright lies. Big popular drugs are usually already made by more than one generic drug maker. If there is a general shortage there is probably a reason that isn't tied to the for profit status of the current vendors so it is unreasonable to think this venture will be immune to whatever roadblock has arisen. Unless the FDA is going to illegally exempt this venture from regulation, the trial lawyers exempt them from late night commercials trolling for "victims" and so forth, hard to see where the result is expected to differ.
If you read the article with a cynical eye, one of the areas they plan to 'compete' is opioids, which due to a media firestorm and widespread misuse are out of favor right now. Easy to see why nobody wants to manufacture an almost unlimited legal liability for pennies per dose. So will this new company be exempt from liability or regulation? Inquiring minds want to know but the article is silent. My guess is they have an inside deal with the FDA but nobody is immune to trial lawyers.
The most obvious difference is they are raising their startup capital from fellow insiders inside the hospital industry, and not the normal capital markets. In other words from people who might know a bit about saving yer ass, probably even know a bit about running a hospital, but are utterly unqualified to vet a startup business plan. But they have the authority to toss shareholder capital at a friend's vanity project and because they will be covered in glowing media nobody but a heretic like myself will dare question the wisdom of the plan.
And when it fails nobody will be held accountable, because they had such noble intentions, except the patients who the losses will be passed on to, along with the insurance industry (who will raise rates on who?) and the taxpayers.
(Score: 3, Interesting) by Anonymous Coward on Friday September 07 2018, @03:48AM
You're reading too much between the lines.
The drugs they are planning to manufacture are the ones that the FDA has specifically prevented them from compounding.
Spinning up a drug manufacturer especially in an anal retentive state like Utah is no small undertaking.
The profit motive here is to save the participating hospitals money by letting them compound stuff they wouldn't be allowed to compound in their own pharmacies anymore.
Opoids or any other "recreationally abusables" are out because well it's Utah and everyone listed in the article is a card carrying Mormon.
(Score: 4, Interesting) by sjames on Friday September 07 2018, @05:01AM
Most of the liability theories for opoids is in the area of false claims in marketing. If they're selling to a ready made market (themselves) with no marketing, opportunities for liability are limited. In any event, anything that might attract a lawsuit would have included the hospitals anyway under the shotgun theory of legal liability.
Next up, there are actually a number of generic drugs where there is now a single supplier. Anyone pro-market economy will tell you that such a situation often leads to a second producer entering the market. Please say hello to that second producer.
All hospitals had a startup at some time. The only reason the patients would suffer a failure of the operation would be that it would no longer be stabilizing the supply or applying downward pressure on price.
On the plus side for the operation, plenty of people well familiar with the legal issues surrounding medicine, knowledge of market demand for the products, and a built in market for the product.
(Score: 0) by Anonymous Coward on Friday September 07 2018, @07:09AM
Hey crazy bastard, do you have to shit on every good thing that might cut into some markets greedy pricing?
(Score: 1, Insightful) by Anonymous Coward on Friday September 07 2018, @02:44PM
Citation needed.