Coronavirus (COVID-19)

[vikesfan89]

6 hours ago, Leader said:

The gym is the very last place you'd find me now. No way. Thats just not happening. Entirely too many people breathing heavy from exercises. How far away is far enough? No thanks. I dont need to live life on those margins. I'll ride out the tide and wait till this things under control before I walk thru those doors again. Till then there's weights at home plus plenty of roads and trails to ride my bike....alone.

You won't find me at a gym either

[Daniel]

7 minutes ago, vikesfan89 said:

You won't find me at a gym either

But let’s not pretend that that’s because of the virus.

[vikesfan89]

4 minutes ago, Daniel said:

But let’s not pretend that that’s because of the virus.

You know me so well

[seriously27]

9 hours ago, Shanedorf said:

Its a legitimate concern and one posed by many, so I'll offer some comments. Gilead is not run by saints and they've had their share of mis-steps in pricing drugs over the years. They've not been a great corporate citizen in some cases, but they are also not the bad guys they are made out to be from my view. ( I don't work for them and I don't own their stock)

Rams99 pointed out that drug $$ is a very complex issue, and it is.
Gilead's treatment for Hepatitis C came out at $84,000 per person and people were understandably freaked out. That's an insane amount of $$ for a drug. But what happened is that the health insurance companies had changed the way they reimburse for new medicines.

In the past, they'd pay for the latest and greatest even if it only offered a marginal upgrade vs the Standard of Care. So that meant lots of "me too" drugs going after the same patient population. Ten slightly different versions of the same cholesterol or blood pressure med and they'd fight over market share. That's not really helping humanity

So the health insurance companies said, "we are going to pay for performance and value. If you can't deliver significantly better results, we won't pay for your shiny new drug "  About that time, Gilead came out with their Hep C treatment that actually cured people. No more meds. No more treatments, no scans, no hospital visits, no liver transplants etc. Based on health economics - it was vastly cheaper to spend $84 K and cure those patients. Gilead didn't make those rules, but they surely used them to their advantage.
As any for- profit company would.

Back to COVID
Gilead was given a $37.5 million federal grant for development of Remdesivir, but that is only a tiny fraction of the money they invested to bring it to market. Most new meds come in around $ 1 billion in clinical/regulatory/mfg costs. More for some, less for others but that's a fair number. So its not really fair to say " We already paid for the R&D" on Remdesivir

More economics: They have to patent that Remdesivir molecule the second they think they have something useful and that buys them 20 years of exclusive sales on that drug before it goes generic. However, new drugs take between 10-15 years in clinical development, so they frequently only have a few years of sales left to cover all those costs, both for the winners and the losers before they go generic

$3100 per patient for Remdesivir isn't out of line with the value it brings not only to the individual patient but to the taxpayers and communities as well. The cost of a visit to the ICU is immense by comparison, so keeping 1 patient out of there is worth it from a health economics POV. Those ICU costs are covered by insurance and those costs are passed on to all of us in our ever-growing premiums.

So we are all better off with Remdesivir than without it. Yes, Gilead will earn a profit from this medicine - but they also stopped work on several of their other drugs in development and that's a steep price for them to pay. They also donated 1.4 million doses in the middle of this pandemic, that comes to over $400 million (at the proposed price) and once we add that to the ledger maybe they aren't the worst company ever.

I don't really like it any more than you do, but once I understood more about it -  I was more accepting of the economics.

One more quick point about this as well as it's important to note that many of the drugs people take are not made assembly line style. It can take months and possibly years to make enough batches for this many people because you have to grow the drug in cells, grow them up to large enough volumes in bioreactors, transfer it to multiple recovery and purification processes and then finally transfer it to the bottling process. All of this has to be aseptic and it all takes a lot of time. It costs the company millions to make the drug. Way more than the manufacturing process of anything else made in the world.  That also doesn't take into account the fact that it takes an average of 9 years for drug to make efficacy approval, FDA approval and then win market approval. That is 9 years where all product development and all manufacturing processes costs come right out of their pocket, and if they go 8 years and it turns out the drug they were working on didn't work as well as they hoped or had worse side effects.....then that is all sunk costs. That's tens or 100s of millions of dollars paid out for 0 profit. Then...those same companies have about 15 years on average, depending on whether they win extension lawsuits,  to make a profit on the drug before other companies are allowed to make generic versions of the same drug. So while it seems like they are making unknown riches on these drugs(yes they do make a very good profit) it's really not as much as it seems. 

Edited June 30, 2020 by seriously27

[theJ]

10 hours ago, Shanedorf said:

Its a legitimate concern and one posed by many, so I'll offer some comments. Gilead is not run by saints and they've had their share of mis-steps in pricing drugs over the years. They've not been a great corporate citizen in some cases, but they are also not the bad guys they are made out to be from my view. ( I don't work for them and I don't own their stock)

Rams99 pointed out that drug $$ is a very complex issue, and it is.
Gilead's treatment for Hepatitis C came out at $84,000 per person and people were understandably freaked out. That's an insane amount of $$ for a drug. But what happened is that the health insurance companies had changed the way they reimburse for new medicines.

In the past, they'd pay for the latest and greatest even if it only offered a marginal upgrade vs the Standard of Care. So that meant lots of "me too" drugs going after the same patient population. Ten slightly different versions of the same cholesterol or blood pressure med and they'd fight over market share. That's not really helping humanity

So the health insurance companies said, "we are going to pay for performance and value. If you can't deliver significantly better results, we won't pay for your shiny new drug "  About that time, Gilead came out with their Hep C treatment that actually cured people. No more meds. No more treatments, no scans, no hospital visits, no liver transplants etc. Based on health economics - it was vastly cheaper to spend $84 K and cure those patients. Gilead didn't make those rules, but they surely used them to their advantage.
As any for- profit company would.

Back to COVID
Gilead was given a $37.5 million federal grant for development of Remdesivir, but that is only a tiny fraction of the money they invested to bring it to market. Most new meds come in around $ 1 billion in clinical/regulatory/mfg costs. More for some, less for others but that's a fair number. So its not really fair to say " We already paid for the R&D" on Remdesivir

More economics: They have to patent that Remdesivir molecule the second they think they have something useful and that buys them 20 years of exclusive sales on that drug before it goes generic. However, new drugs take between 10-15 years in clinical development, so they frequently only have a few years of sales left to cover all those costs, both for the winners and the losers before they go generic

$3100 per patient for Remdesivir isn't out of line with the value it brings not only to the individual patient but to the taxpayers and communities as well. The cost of a visit to the ICU is immense by comparison, so keeping 1 patient out of there is worth it from a health economics POV. Those ICU costs are covered by insurance and those costs are passed on to all of us in our ever-growing premiums.

So we are all better off with Remdesivir than without it. Yes, Gilead will earn a profit from this medicine - but they also stopped work on several of their other drugs in development and that's a steep price for them to pay. They also donated 1.4 million doses in the middle of this pandemic, that comes to over $400 million (at the proposed price) and once we add that to the ledger maybe they aren't the worst company ever.

I don't really like it any more than you do, but once I understood more about it -  I was more accepting of the economics.

Let's be real here: most everyone on this forum can afford this if push comes to shove.  It'd be a hit to the pocketbook for sure, but in the long run not a huge deal.  Most Americans pay more on their car lease, or eating out, every year.

And like was pointed out in one of the last few pages, this is not the price point that economically depressed are going to receive.  The comparably "rich" (like most of us here are) are going to pay a proportionally larger cost.  Which is fine.

 

Also, i said it months ago when this all started: everyone should be trying to save a larger rainy day fund right now, until the worst of this pandemic is behind us.  For various reasons like job loss, increasingly scarce resources, and of course medical costs.  

[JDBrocks]

I appreciate the research and the explanations, @Shanedorf and @seriously27. I still feel that it's too high in extraordinary times, especially coming from a company like Gilead. I don't feel bad for phrama companies dealing with sunk cost/low early ROI. When the stakes are highest (life or death level), pharma companies routinely choose profits over life. 

Additionally, the taxpayer funding is closer to 70 mil than to 37 mil. Regardless of the additional cost beyond that number, the American public contributed to all of Gilead's massively marked up drugs. A group at the University of Liverpool did a write up and found the cost of production at scale in the US based on the necessary ingredients to be about $.93 per day. Gilead would be able to turn a profit at $1.00 per dose. I don't know that that estimate is fully reasonable, but there's a pretty substantial gap between $.93 cost and the list price.

Here's the article, for reference.

[seriously27]

45 minutes ago, JDBrocks said:

I appreciate the research and the explanations, @Shanedorf and @seriously27. I still feel that it's too high in extraordinary times, especially coming from a company like Gilead. I don't feel bad for phrama companies dealing with sunk cost/low early ROI. When the stakes are highest (life or death level), pharma companies routinely choose profits over life. 

Additionally, the taxpayer funding is closer to 70 mil than to 37 mil. Regardless of the additional cost beyond that number, the American public contributed to all of Gilead's massively marked up drugs. A group at the University of Liverpool did a write up and found the cost of production at scale in the US based on the necessary ingredients to be about $.93 per day. Gilead would be able to turn a profit at $1.00 per dose. I don't know that that estimate is fully reasonable, but there's a pretty substantial gap between $.93 cost and the list price.

Here's the article, for reference.

Well for reference I was speaking generally. But Remdesivir is not a biologic, and therefore does not have the manufacturing costs of a lot of prescription drugs or vaccines. So in that scenario, the markup is definitely high. 

[Shanedorf]

1 hour ago, JDBrocks said:

A group at the University of Liverpool did a write up and found the cost of production at scale in the US based on the necessary ingredients to be about $.93 per day.

Thanks for the notes
This linked info is akin to saying the cost to produce steel is 1 cent per pound, therefore cars should only cost 50 dollars.
There's a bit more to it than that.
And I guarantee that you would not be a happy camper taking a pill produced under the imaginary conditions they created for this paper . Generic companies in India who cut corners, cheat the system, produce crap quality and are shut down by the FDA on a regular basis -  even they can't produce Remdesivir for a dollar a dose. It speaks to the incredible regulatory control of every step in manufacturing a product that could kill you if not done 100 % correctly 100 % of the time. If the auto industry were held to a similar standard, there would never be a "lemon" but cars would cost $250,000 for a Camry

They've done a "thought" exercise, but they have no data from any company anywhere who can achieve what they've suggested, because no such data exists.
I appreciate your POV and comments, I'm sure Gilead could deliver Remdesivir for less than $3100/ patient. On the other hand an independent study done by health insurers pegged the value to consumers at $4400/ patient using their methodology - so there's a wide variety of info, data, commentary and opinions on the topic and it really depends on your POV.

Edited June 30, 2020 by Shanedorf

[JDBrocks]

8 minutes ago, Shanedorf said:

Thanks for the notes
This linked info is akin to saying the cost to produce steel is 1 cent per pound, therefore cars should only cost 50 dollars.
There's a bit more to it than that.
And I guarantee that you would not be a happy camper taking a pill produced under the imaginary conditions they created for this paper . Generic companies in India who cut corners, cheat the system, produce crap quality and are shut down by the FDA on a regular basis -  even they can't produce Remdesivir for a dollar a dose. It speaks to the incredible regulatory control of every step in manufacturing a product that could kill you if not done 100 % correctly 100 % of the time. If the auto industry were held to a similar standard, there would never be a "lemon" but cars would cost $250,000 for a Camry

They've done a "thought" exercise, but they have no data from any company anywhere who can achieve what they've suggested, because no such data exists.
I appreciate your POV and comments, I'm sure Gilead could deliver Remdesivir for less than $3100/ patient. On the other hand an independent study done by health insurers pegged the value to consumers at $4400/ patient using their methodology - so there's a wide variety of info, data, commentary and opinions on the topic and it really depends on your POV.

I agree that there is more to it, and alluded to as much. Is the gap really $3199 though? Especially in light of an actual pandemic that is already crippling the economy and families that have lost their jobs? People are being asked to sacrifice so much, and Gilead appears to have opted for a cash grab. They certainly haven't earned the benefit of the doubt.

[Daniel]

Isn't that $3199 price the price with private insurance?

[TVScout]

3 hours ago, ET80 said:

Is there anything outlining a state other than MN?

Info is hard to find but stats are similar in Ca and Wa:

https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID-19/COVID-19-Cases-by-Age-Group.aspx

https://www.doh.wa.gov/emergencies/coronavirus

[diehardlionfan]

The U.S. pays far more for prescription drugs than other countries. 

[Shanedorf]

36 minutes ago, JDBrocks said:

They certainly haven't earned the benefit of the doubt.

No they haven't - and neither has the pharma industry in general. They have a long way to go to earn the trust of the American public. 
But at least they are making a positive contribution to mankind and I'm glad to have some life-saving options as the infection rates continue to grow

 

Just now, diehardlionfan said:

The U.S. pays far more for prescription drugs than other countries. 

We do.
The US subsidizes the costs for poorer countries in some cases. In others, its our own bureaucracy and litigation that drives up our costs, while in others its just profiting off the patients. Drug pricing is a hot topic with no easy answers.

[LETSGOBROWNIES]

 

9 minutes ago, Shanedorf said:

We do.
The US subsidizes the costs for poorer countries in some cases. In others, its our own bureaucracy and litigation that drives up our costs, while in others its just profiting off the patients. Drug pricing is a hot topic with no easy answers.

Let’s be honest, there are some easy answers.

They don’t fix everything, but when we pay the most out of everyone, it’s pretty clear there are some better options. (Trying to toe the line politically here).

[Daniel]

3 minutes ago, LETSGOBROWNIES said:

 

Let’s be honest, there are some easy answers.

They don’t fix everything, but when we pay the most out of everyone, it’s pretty clear there are some better options. (Trying to toe the line politically here).

Not possible, but I agree, IMO there are a couple of very easy answers.

Incidentally, both the wife and I are developing symptoms now.  Headaches and bodyaches, nausea for my wife.  No fevers yet, as far as we can tell though, so it could still be anything else.