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Drug Giant Pledges Cheap Medicine For World's Poor
bmsleight writes in with a Guardian piece on the decision of the world's second biggest pharmaceutical company, GlaxoSmithKline, to radically shift its attitude towards providing cheap drugs to millions of people in the developing world. "[The new CEO] said that GSK will... cut its prices for all drugs in the 50 least developed countries to no more than 25% of the levels in the UK and US — and less if possible — and make drugs more affordable in middle-income countries such as Brazil and India; put any chemicals or processes over which it has intellectual property rights that are relevant to finding drugs for neglected diseases into a 'patent pool,' so they can be explored by other researchers; and reinvest 20% of any profits it makes in the least developed countries in hospitals, clinics, and staff."
It's not generous, it's just good sales. Maybe greed is good though.
Consider that just because a nation's average income is relatively high, it does not follow that everyone in that country is able to buy the products at the higher price. Why should people who had the dumb luck to be born in some shithole country be blessed with lower-priced medicine?
That's not social justice. It's social prejudice.
Aren't drugs already like 50% in Canada? So wouldn't a more meaningful gesture be to sell drugs for 25% of the price in Canada?
Three-quarters-off a $200 prescription is still $50. Not something that people living on a dollar or two a day can afford.
from the article: "although they worry that it may undermine the generics industry which currently supplies the cheapest drugs in poor countries"
The Nigerians are already working on it. In the next few days you should receive an email telling you how to transfer the money.
Medicine isn't some impulse buy of a newfangled gadget. People live and die by their ability to acquire it.
I think a good example of this is Nexium. http://en.wikipedia.org/wiki/Esomeprazole#Controversy
Another good example is the antidepressant Lexapro which is just the active isomer of Celexa.
Yes, some drugs do cost an absolutely massive amount of money to develop but most drug companies are heading towards the cheaper option of extending their patents rather then creating anything new that could benefit society.
FTA: "Campaigners privately say the move is remarkable, although they worry that it may undermine the generics industry which currently supplies the cheapest drugs in poor countries."
Exactly. Big pharma is in big trouble - blockbuster drugs going off patent, no new ones coming online, Govs. getting more aggressive in fixing prices. So, this is a smart move. While they still can, they can use the one advantage they still have - their size - to buy/crush the small 'generics' producers out.
Still, whatever the underlying motivation, it's encouraging to see big pharma at last getting more involved with the poorer nations of the world, which have been scandalously ignored.
Yes, R&D costs are very high. But a significant portion of the research is sponsored by governments, not necessarily by drug manufacturers. Plus, it's hard to be sympathetic when drug manufacturers spend more money on marketing than on R&D. They also have one of the largest profit margins.
It's a little unfair to be comparing the costs of drugs and of graphics cards. One is possibly a matter of life and death. And, in an economy in which every major industry is suffering, healthcare costs continue to rise.
Of course they are not doing it from the kindness of their hearts. It's a matter of damage control. A country (any country) can break the patents and start producing any drug in case of need if a commercial arrangement can't be reached with the patent holder so, if they don't provide cheaper drugs, they will lose the whole deal.
Scientia est Potentia
Step 1. Go to so-called "poor country."
Step 2. Buy 10,000 units of drug X at 25% of its cost in the US/Canada/Europe.
Step 3. Sell drug X in US/Canada/Europe at 50% of its normal Drug X cost (i.e. at twice the price you paid), advertising your pharmacy as having the best prices in the country.
Step 4. (Just do step 3 a lot)
Step 5. Profit!
Yeah! This is only possible because Starbucks has been lowering its coffee prices. The 40-60% they spend on marketing has dropped significantly since the truckloads of crap they buy docs has gotten cheaper in the failing economy. I will be a little sympathetic when their research costs more than the bribery they engage in. I will be a little sympathetic when they quit "modifying" drugs to get an extra 2% effectiveness on some minimal behavior of a drug to get a new patent for it so they can charge exhorbant prices over the previous version that can now be made in generic form for pennies. I will be a little sympathetic when they quit buying political figures to push for mandatory vaccinations of school girls at $360 a pop when even one of they key researches of the vaccine says it is not meant for girls that young and could actually be harmful.
I mean seriously...let's all feel sorry for the serial killer that has to dig yet another hole...digging holes is hard work after all. Right now these companies are facing big problems in these countries because those governments are invalidating their patents right now. These companies want so much money that the peopel cannot afford that the people's governments have said "Fuck off, we will make our own generics". I suspect this "generous" price drop has more to do with putting political/economic pressure on these countries to enforce patents than it does some generous streak.
The only change I can believe in is what I find in my couch cushions.
Of course, such an arrangement is only possible if people respect the "licence" (contract that is a prerequisite of the sale) of the pills.
That contract is going to specify that export to richer countries is not permitted.
Suppose this after-sale contract were to be ruled void (which is quite possibly the correct way for a judge to rule given current law), and import allowed, the pharma "giant" will be competing against itself, resulting in massive losses.
Those massive losses, that stem from not respecting the "licence" of the pills, will either prevent the pharma company from offering those pills, or they will kill the company.
Great initiative ! I truly hope it will last, but I fear for it's viability.
My current favorite for that B.S. is Johnson&Johnson, "a family [owned] company".
I've never heard JNJ referred to as a family company. Are you confusing it with SC Johnson, the company that makes Ziploc, Windex, and Scrubbing Bubbles products?
Human nature being what it is, this is an excellent opportunity for black market corruption -- drug company sells to developing country. Corrupt elements in developing country sell back to corrupt black marketeers who then resell in 'rich' countries to corrupt vendors for reduced prices and still make huge profits.
And still the people who need the drugs don't get them, but maybe some actually will, and that's a good thing.
Not that I am a fan of outsourcing, but India's Rupee is not fixed, its value changes all the time against the dollar. The Chinese Yuan is, however, fixed.
Magnus
Drugs are not sold by hospitals. Drugs in hospitals are free. For prescriptions, people buy their drugs from a pharmacist. The province isn't the one purchasing those. Pricing has nothing to do with the province.
In fact, prices in Canada are controlled by a federal Government entity, the Patented Medicine Prices Review Board:
http://www.pmprb-cepmb.gc.ca/
They set pricing limits. This has nothing to do with "huge bulk orders".
Well this case its a company, not a government, deciding to force charity, but don't let that get in the way of your libertarian rage.