Drug pricing

Consider this from Financial Times:

The battle over European drug pricing | Financial Times

A clash between drugmakers and UK and EU governments over drug pricing is coming to a head. The head of Bayer’s drugs business warned this week the German company was shifting its pharmaceutical arm’s focus to the US, and away from Britain and European countries that were making “big mistakes” in managing health budgets. AbbVie and Eli Lilly became the first drug groups to pull out of a voluntary UK pricing agreement they said punished innovation. Governments cannot simply bow to corporate browbeating. But they must balance the need to restrain health costs with their ambitions to lure life sciences investment.

Drug pricing is a tricky issue. How do you price an “innovative” healthcare intervention? I believe the sweet spot for any new drug is the highest price a company wants versus the lowest price an insurance company is willing to pay. This will serve as a “benchmark” price, and then exported across the world. What is the impact on the survival, if you may ask? You’d be branded as a heretic.

Therefore, these abstract terms like innovation and intelligence are always contentious. If you add a political spin, it’s all the worse! The editorial is highly specific to the UK, but it had elements around innovation, margins and pharma that require (and merit) closer scrutiny.

Something more:

The report said there was a need for sustainable pricing policies. Industry leaders warn the ability to achieve decent returns is bound to figure in investment choices. This covers not just prices, but access and uptake for innovative drugs. The US scores well here, while the UK’s stringent clinical and value-for-money appraisals mean cutting-edge drugs are often made less widely available and take longer to get to patients than in some EU rivals.

As much as the NHS may be reviled, I completely agree with the cautious approach by the British to approve newer drugs, with a strict rider on measurable impact on survival. I am researching the impact of immunotherapies, and while “promising”, they require a clear guideline around measurable survival values. This is to get the productive age groups to remain productive. Those in the twilights require aggressive palliative care.

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