The costs of drugs as a driver for healthcare expenses in the USA

[MillCreek]

http://www.medpagetoday.com/PublicHealthPolicy/PublicHealth/66171

A really interesting article about how a pharma company found a way to combine two over-the-counter drugs and charge $ 3000+ for a month's supply of it.

[Fly320s]

Heard that story on the radio.  Such a scam.

[RevDisk]

Not saying I agree. But one doesn't have to agree with gravity to understand jumping off a building won't end well.

[makattak]

This is yet another example of how messed up our healthcare system is.

The end user rarely faces (or even knows!) the price of the good/service. The costs, too, seem to be unrelated to the price.

We'd do much better if people had to pay for most expenses out of pocket and had coverage only for the largest problems. (You know, how insurance works as opposed to health "insurance")

Additionally, we have a severely messed up patent system that gives patents for useless changes (We combined peanut butter AND jelly in one jar. It's a NEW PRODUCT! Patent approved.) while FDA approval makes ACTUAL breakthrough drugs take so long to get to market that the patent protections last barely enough time to cover R&D, meaning that it's far more profitable to work with already tested safe drugs than to develop new ones which may or may not be "safe."

And, of course, I've only mentioned ONE aspect of the government's meddling in the market, which further drives up costs.

What's the solution? I'm not sure what can be done at this point, because every politically feasible "solution" would make things worse.

[Pb]

My mother used to have to put a lotion-like medicine in her eyes for an eye disorder.  It was basically Vaseline and salt.  They charged over a hundred dollars for a quarter ounce tube.

[MechAg94]

This is yet another example of how messed up our healthcare system is.

The end user rarely faces (or even knows!) the price of the good/service. The costs, too, seem to be unrelated to the price.

We'd do much better if people had to pay for most expenses out of pocket and had coverage only for the largest problems. (You know, how insurance works as opposed to health "insurance")

Additionally, we have a severely messed up patent system that gives patents for useless changes (We combined peanut butter AND jelly in one jar. It's a NEW PRODUCT! Patent approved.) while FDA approval makes ACTUAL breakthrough drugs take so long to get to market that the patent protections last barely enough time to cover R&D, meaning that it's far more profitable to work with already tested safe drugs than to develop new ones which may or may not be "safe."

And, of course, I've only mentioned ONE aspect of the government's meddling in the market, which further drives up costs.

What's the solution? I'm not sure what can be done at this point, because every politically feasible "solution" would make things worse.

Yep, the patient isn't paying for it so doesn't ask questions.  The Doctor knows the patient isn't paying for it so why should they worry about it.  If the patient had to pay $3000 per bottle, the patient would be asking more questions and the doctor might make a little more effort to know what it is and advise the patient. 

It is just an example of the waste and fraud that is inherent in a 3rd party payer system.  No one gets directly hit by the costs so little real effort is made to control it.  Then everyone is SHOCKED by the total cost of Healthcare in the US.

[RevDisk]

My mother used to have to put a lotion-like medicine in her eyes for an eye disorder.  It was basically Vaseline and salt.  They charged over a hundred dollars for a quarter ounce tube.

While yes, there are high markups... There's also a hell of a lot more than cost of raw materials. Vaseline and salt both need clear audit trails. Testing. Purity levels. The people and facilities to do all that aren't cheap. And liability coverage in case something goes wrong, or they get sued just because.

Aircraft parts work the same way. Every rivet or bolt is engineer sign offed, accounted for, subject to testing, lot numbered, regulatory overhead out the ying yang, etc. Makes a $5 piece of aluminum into a $200 piece of aluminum in a hurry.

[MechAg94]

While yes, there are high markups... There's also a hell of a lot more than cost of raw materials. Vaseline and salt both need clear audit trails. Testing. Purity levels. The people and facilities to do all that aren't cheap. And liability coverage in case something goes wrong, or they get sued just because.

Aircraft parts work the same way. Every rivet or bolt is engineer sign offed, accounted for, subject to testing, lot numbered, regulatory overhead out the ying yang, etc. Makes a $5 piece of aluminum into a $200 piece of aluminum in a hurry.

The quantity of paperwork and auditing required for FDA regulated products is a very significant cost.  Our company sells FDA regulated Nitrogen gas and Oxygen gas.  We finally set it up so all that product comes from a handful of production plants so they can more or less specialize in the paperwork required.  You can't just test the final product.  They regulate and audit the entire process plant, maintenance procedures, procurement, storage of "clean" parts, etc, etc.