Wednesday Writs: Mini Edition

JS in reply to Oscar Gordon says:

Worth noting humalog debuted in 1994 or so at 35 a vial. It represented years of R&D and was a massive, massive improvement over regular human insulin. Doctors all but threw their patients at it, because the risks of hypoglycemia were so much lower (if you mess up humalog you were likely to end up with your blood sugar too high, which is not great but causes damage over time. Previously if you messed up with human insulin, you were more likely to end up too low — which is where comas, ambulances, and possibly death awaited.)

Patients on humalog were no longer forced into incredibly rigid meal or snack schedules to avoid going hypoglycemic, resulting in better and healthier patients with lower risks. It was a fantastic step forward. They made serious profits — including paying back their R&D costs — rapidly.

And Humalog stayed about that price right until it got a competitor, and then a weird thing happened — both slowly started increasing in price. In lockstep. As generics came out, they were always about 70% of the price of their name brand, and again prices would increase in lockstep.

Now Humalog costs — in America only — about 10 times what it did in 1994 (inflation says it should be about twice as much). It has multiple competitors and generics. They’re all that high.

And it’s dirt cheap to produce. ALL forms of modern insulin are made the same way — genetically modified single-cell organisms excrete it. It’s closer to brewing medical grade beer in many ways. Any half-decent lab can modify the e coli or yeast for you, and the feedstock is cheap as are the processes. There are no bottlenecks in supply, and expanding production is not difficult at ALL by pharmaceutical standards.

Given the facts, there’s really only one reason a single country would see a ten-fold increase in a good despite multiple competitors and no underlying raw material or manufacturing bottlenecks: Price fixing.

(Unless someone wants to argue that the creators of Humalog had a fun plan where they’d make back all their R&D costs 25 years after it debuted, when it had heavy competition. Given every drug in creation seems to be part of a price fixing scheme in America, from prescription stuff to stuff like albuterol and even Anusol — seriously, 200+ bucks for a dosage of steroids in suppository form that goes for 20 bucks in England OTC . That’s WITH insurance. Prescription drug pricing is, bluntly, broken in America)Report