Wednesday, January 30, 2019

NYT Discards The Right Cause For "The Insulin Wars"

The New York Times somehow recognized that patent protection is behind the whack-a-mole madness of insulin prescriptions, yet mostly elides that as causal:
There are several reasons that insulin is so expensive. It is a biologic drug, meaning that it’s produced in living cells, which is a difficult manufacturing process. The bigger issue, however, is that companies tweak their formulations so they can get new patents, instead of working to create cheaper generic versions. This keeps insulin firmly in brand-name territory, with prices to match.

But the real ignominy (and the meat of the lawsuit) is the dealings between the drug manufacturers and the insurance companies. Insurers use pharmacy benefit managers, called P.B.M.s, to negotiate prices with manufacturers. Insurance programs represent huge markets, so manufacturers compete to offer good deals. How to offer a good deal? Jack up the list price, and then offer the P.B.M.s a “discount.”
Minus spurious patents, this kind of tomfoolery wouldn't happen. Patent reform as it applies to medicine, is absolutely a precondition to fixing pharma pricing.

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