Doctors Call Out Novartis For Insane Pricing On Cancer Drug

from the as-they-should dept

Novartis has been in the news lately for the lawsuit filed against it by the US government for kickbacks it allegedly gave to doctors for prescribing certain drugs. As we noted about that case, it should be no surprise that this sort of activity happens, given that the incentive structure we've created with patents is so extreme. Here's one example of at least some principled doctors striking back against Novatis. Over 120 cancer researchers and doctors have published a paper calling out Novartis specifically for its pricing on the cancer drug Gleevec (marketed as Glivec outside the US). The doctors point out that it can cost over $100,000 per year for Gleevec currently. And, Novartis has been continually jacking up the price. There had been concern when the drug was first introduced a decade ago, that it was priced way too high at $30,000, leading the company's then CEO, Daniel Vasella, to acknowledge the complaints, but to argue that it was "a fair price." Well, now the company is pricing the drug at more than three times what it thought was a fair price, and it should be no surprise that people think this is outrageous profiteering by abusing a government granted monopoly to charge way more than any fair market price would allow.

The paper these doctors published points out that such high prices undoubtedly causes harm to patients who need the drug. The lead author of the paper told CNN that this whole situation is unsustainable, and something needs to be done to bring prices down to a more reasonable, market-based level. He just focused on Gleevec because it's his area of research:
"These price increases do not reflect the cost of development of drugs or the benefit they provide to the patient," he told CNNMoney. "They are simply related to the drug companies' wish to increase profits beyond a reasonable range."
Of course, one key way to help drive down prices is to do the obvious: stop granting government-given monopolies on the production of such drugs. That, alone, is the reason why the prices are so crazy in most cases. Thankfully at least some countries have recognized how ridiculous this is. India recently blocked Novartis from trying to patent a slightly different version of Gleevec, which means that the company will finally face some real pricing pressure from generics in that country. One would hope that other countries would do the same, and recognize that competition isn't a bad thing. It might just save lives.

Filed Under: gleevec, kickbacks, pharmaceuticals
Companies: novartis


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  1. identicon
    NooberPooF, 4 May 2013 @ 8:57am

    RnD

    When it comes to RnD it is all done on the publics dime in either Universities, Hospitals or Government research centers of your choice. Once something shows promise on becoming comercial there are two roads. 1) Small startup with small investors that strugle to make it commercial. They invaruably run into financial issue for some odd reason once the base gets established and are "rescued" by a big player. Invariably stripped and gutted they are closed as nonviable. 2) Big pharma steps in because the product is already ready to go commercial and add their "research" to commercialize the product. Pretty much this is just scaling up the manufacturing process while cutting the cost of per unit production.

    Either way they do not actually carry the burden of the actual reserch. The rest of us do.


    Remember that big pharma is in the business of selling treatments, not cures. Cures cut into their bottom line. As put forth in business journels et al - profit is the only corporate responsibility.

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