It can be a fair proposition to ask a fully developed nation to invest more into pharmaceutical research.
Making the drugs once they are tested is the cheap part. Ensuring the drugs do what they are supposed to and don’t cause long term effects is extremely expensive.
The US spends about half of global spending on drug research, out spending all of Europe per
Can also ask why most of the Europe pharmaceutical companies charge US citizen more for medication than their own people. It’s really ALL pharmaceutical companies charge US more. Regarding BioNTech, it is innovative but don’t have the manufacturing and distribution capacity as Pfizer. Can’t really said Pfizer is pure evil (just based on this context). [distribute the medication
Well it's probably not the government wanting, but the pharma lobby. What's flabbergasting for the rest of the world is, that the US citizens keep voting for people who indulge big companies instead of people who negotiate the best prices vor them.With Trump they promoted the goat to be the head gardener. A tendency we see in Germany too, to be honest, with our Black Rock chancellor.
Actually that’s not true. It is the US government wanting.
Read the history on how Pharma pricing and US gov policies evolve after WW2. Can also find some reputable research on how Europe gov set limitation on their own companies pricing. It may change your perspective. I remember one of EU gov basically set policies to their own local pharma to charge certain discount compare to the US price to ensure affordability. Basically asking their own pharma comp to overcharge US citizen and subsidize their own.
I gained my source from “the economist” regarding the fight between Pharma companies and the gov since Joe Biden trying to make medication in US more affordable, and how Donald Trump continue to double down the fight. It also shows the arguments that both sides are using to “justify” their policies. It shows the perspectives on all stalk-holders. For example, when US Gov forces pharma to drop their price in US, the R&D spending are first to cut, that’s including EU pharmaceutical companies as well. We are not talking about 1 individual company, but aggregate R&D spending.
Long story short, US citizen are subsidizing the whole world since WW2. All financial modeling are based on US citizen. The rest of the market is just icing, hence pharma companies can charge so little for the original brand to others, especially to the 3rd world countries. It was justified and done purposefully by US gov because US was a superpower that the no. 2 can’t even come near close. However, it has become the standard practice for ALL pharmaceutical companies worldwide to do so. There is a long histories on how the policies slow evolved etc. It is quite interesting. I am not even from US.
Pharma companies make well and truly enough profits to cover R&D. What we're talking about here is profit margins not adequate R&D budgets. The reason the numbers look like the US spends nearly 50% of the annual worldwide R&D spend is because many of the largest pharma companies are US headquartered (Eli Lilly, J&J, Merck, Pfizer). It's not as simple as "the US is paying for R&D for the world".. although that argument "sells" well when playing the victim. The simple fact is the reason pharma charge US residents more for drugs than is reasonable is because they can get away with doing so. One of the two big pharma companies I worked for (implementing finance systems internationally) sold as much in gross sales (in dollars, not volume) in the USA as they did in every other country in the world combined... that's simply due to margin.
Not really, like any product it takes time for a new drug to achieve market penetration. In this case it's doctors knowing about it and being comfortable enough with its effects to prescribe it in various cases
If a drug has been around for longer in the US it stands to reason that usage will still be ahead there for a while
Further, just because something is on the world market doesn't mean all countries buy it immediately. Take the NHS for example, there are months of internal discussions about whether a new drug is worth it, followed by months or years of negotiations with the company for a deal
Consuming new medications doesn’t negatively impact research spending though.
Yeah they come to the US first, why, because the US pays the most for per medication, or the US has better healthcare than Reddit would lead you to believe.
Although most of that goes into the companies pocket it does lead to an incentive of innovation to continue funneling money into the pharmaceutical research.
If Germany is pulling back on research spending and cutting deals with pharmaceutical companies that limits further research the US does have a dog in the fight to not be thrilled about it.
Yup because the margin is so disproportionately large on US drug prices. Interesting to see you quote that number because quite a few years back I was in big pharma (GlaxoSmithKline at the time) and back then GSK's annual income split btw the US and every other country was almost exactly 50%.... I guess nothing has changed.
That's mostly because of the toxic "food" people consume here while living sedentary lives and getting lead poisoning from the crumbling infrastructure
Why? The cost of research is baked into the cost of the drugs. The cost that those nations pay is negotiated with the pharmaceutical companies. No one is forcing them to sell their drugs to those nations.
Testifying before the US Senate health committee in February 2024, MSD’s chairman and chief executive said his company had invested $30 billion in its Keytruda research programme since 2011. This figure cannot be verified, as companies are under no obligation to publish or account for R&D costs on a product-by-product basis.
[...]
Our estimate of Keytruda’s research and development costs stands at $1.925 billion (CHF 1.52 billion) – equivalent to just 1.2% of the drug’s global sales to date. This is far below the figure cited by MSD’s chief executive. Even when potential failures are taken into account, the total cost of Keytruda’s research and development ($4.79 billion, around CHF 3.8 billion) represents barely 3% of the medicine’s turnover.
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u/bshjbdkkdnd 4h ago
It can be a fair proposition to ask a fully developed nation to invest more into pharmaceutical research.
Making the drugs once they are tested is the cheap part. Ensuring the drugs do what they are supposed to and don’t cause long term effects is extremely expensive.
The US spends about half of global spending on drug research, out spending all of Europe per
https://efpia.eu/publications/data-center/the-pharma-industry-in-figures-rd/pharmaceutical-rd-expenditure-in-europe-usa-china-and-japan/