Desperate Drug Companies Raising Prices On Drugs Still Under Patent
from the squeezing-every-last-cent dept
In recent weeks, we’ve discussed how drug companies are freaking out because they can’t find anything new to patent, and their popular drugs are about to go off patent. Of course, as we’ve seen, having a monopoly lets them charge ridiculously high prices, and so the various drug companies (at least those who can’t get the FDA to just hand them a new monopoly) are apparently dealing with the first issue by embracing the second one: they’re ramping up prices on pretty much anything they still have under patent, with the largest increases being for those drugs that are closest to going off-patent.
Talk about a short-term strategy. Historically, it’s been shown that when brand name drugs go off patent, they still command a significant premium in price over generic competitors. Yet, if the drug companies keep raising the prices higher and higher, it’ll simply drive more people to seek out cheaper alternatives. If the drug companies actually priced the drugs reasonably, and recognized that they already had a strong branding lead (often on the backs of huge marketing campaigns), they’d realize they could keep a decent share of the market, even with somewhat higher prices. But simply trying to squeeze every last penny out of people while the drugs are still under patent seems like a strategy to completely give up once the drugs go off patent.