Slashdot Mirror
'Is Curing Patients a Sustainable Business Model?' Goldman Sachs Analysts Ask (arstechnica.com)
In an April 10 report for biotech clients, Goldman Sachs analysts noted that one-shot cures for diseases are not great for business as they're bad for longterm profits. The investment banks' report, titled "The Genome Revolution," asks clients: "Is curing patients a sustainable business model?" The answer may be "no," according to follow-up information provided. Slashdot reader tomhath shares the report from Ars Technica: Analyst Salveen Richter and colleagues laid it out: "The potential to deliver 'one shot cures' is one of the most attractive aspects of gene therapy, genetically engineered cell therapy, and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies... While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow."
For a real-world example, they pointed to Gilead Sciences, which markets treatments for hepatitis C that have cure rates exceeding 90 percent. In 2015, the company's hepatitis C treatment sales peaked at $12.5 billion. But as more people were cured and there were fewer infected individuals to spread the disease, sales began to languish. Goldman Sachs analysts estimate that the treatments will bring in less than $4 billion this year. [Gilead]'s rapid rise and fall of its hepatitis C franchise highlights one of the dynamics of an effective drug that permanently cures a disease, resulting in a gradual exhaustion of the prevalent pool of patients," the analysts wrote. The report noted that diseases such as common cancers -- where the "incident pool remains stable" -- are less risky for business.
For a real-world example, they pointed to Gilead Sciences, which markets treatments for hepatitis C that have cure rates exceeding 90 percent. In 2015, the company's hepatitis C treatment sales peaked at $12.5 billion. But as more people were cured and there were fewer infected individuals to spread the disease, sales began to languish. Goldman Sachs analysts estimate that the treatments will bring in less than $4 billion this year. [Gilead]'s rapid rise and fall of its hepatitis C franchise highlights one of the dynamics of an effective drug that permanently cures a disease, resulting in a gradual exhaustion of the prevalent pool of patients," the analysts wrote. The report noted that diseases such as common cancers -- where the "incident pool remains stable" -- are less risky for business.
This is the basic reason that a private healthcare system can never be an ethical or ideal system. Making a profit can only come at the expense of someone's health, life, or livelihood. It ultimately places the burden of providing that profit on society as a whole.
I've never heard of a pharma company that says it needs more sick people. The reality of that industry is that the big players in the US are by far and away at the forefront of finding new cures and new therapies. After their market exclusivity and/or patents expire, they move on. Do you know who takes over from there? Companies with much smaller margins that make generic medications that are the same from one manufacturer to the next, effectively making them commodities. TFS mentions Gilead Sciences cure for Hep C, so let's drive this point further home using them as an example:
Contrary to popular conspiracy theories, they had the opportunity to create a permanent cure for the disease, and they made no attempt at all to prevent it from being fully effective. The prior-existing pharmaceutical treatments for Hep-C (i.e. anti-viral drugs, treatments for cirrhosis) were already profitable, and they could have simply spent their resources coming up with drugs to treat those symptoms that apply to all people with liver disease, or even in the case of anti-viral drugs, they could have worked for more than just this. But no, they went after the cure, and it cost them a lot of money. Meanwhile, guess what? Other companies are already jumping into this market without waiting for any patents to expire by developing new formulas:
https://www.npr.org/sections/h...
If a cure doesn't pay off, or if Big Pharma doesn't want it to happen, then why the fuck would they bother? Call it unethical all you want, but if any more ethical approaches work, they damn sure aren't delivering anywhere close to the results than the existing "unethical" system does.
So which do you prefer?
1. You pay money to motivate somebody to be interested in creating a cure, and you don't die
2. You say "paying money for a cure is unethical!", nothing ever gets done, and you die
Besides that, the rest of the world should be grateful that the US works the way that it does. The democrats and the rest of the world love to bash our health care and bash the "megacorps" that operate here, but the US private sector has been providing ALL of them the cures, treatments, and therapies to more diseases than anybody else for the past few decades. Cures like this come here for a reason: The political situation here allows cures that work to receive great returns. Meanwhile, the rest of the world (typically) only pays a fraction for these treatments compared to what US citizens do, which effectively means that the US private sector is subsidizing the "free" health care that other countries provide.
So please, try not to take it for granted. And no, this is not to say that our health care system is perfect (believe me, there are plenty of legitimate complaints against it.)
Switzerland is also a powerhouse in drug making, especially if you count it per capita or per GDP. And they have an Obamacare-like system, with the exception that "basic" insurance plans must be non-profit. The insurers themselves do not need to be non-profit, and can offer additional coverage, package deals with other insurance, or special access to non-basic treatments as additional profitable add-ons. But basic insurance, which everyone must have (with subsidies if it takes more than a certain percentage of your income), everyone must accept, and covers all life-saving and common treatments, is non-profit here.
There are a lot of possible solutions, and the US is surprisingly close to something that works and yet insists on sticking with something that has the worst outcomes in the world... if the current political leadership would get off their high horse and try to figure out something that works for people instead of businesses the problem is solvable.
E pluribus unum
Let's be realistic. Switzerland doesn't have an obamacare like system, they have a system which is similar to Canada's though. In Canada, insurance is optional but the healthcare system is funded through taxes. All critical care is covered. But you'd be foolish not to carry supplemental insurance here, because things like drugs, injection pumps and so on aren't covered. Obamacare was basically the worst of all possible worst things that could have been put into place, and basically put all of the power directly into federal hands(aka DC). Compare to Canada, where the only federal has control is with the military, native reserves, territories(yukon, nvt, etc). Each province is responsible, each province must have a minimum level of care. That care level is determined by a 3rd party, the system also uses a "top up" method from federal general revenue funds paid into provincial healthcare budgets.
It's not perfect, it's not fun waiting 3-9 months for a MRI either. Nobody likes to wait 160 days for cancer treatment to start either, or 120 days for bypass surgery. But that's what we've got. It's also not fun living in remote parts of provinces and having to travel 4hrs+ to go to the hospital either, but that happens too. But people generally don't go bankrupt from primary treatment, but they do go bankrupt from secondary treatment.
if the current political leadership would get off their high horse and try to figure out something that works for people instead of businesses the problem is solvable.
The current political leadership tried. It was shot down by rino's and democrats. Then several different groups tried again, modeled after a system in montana(which was modeled off canada's system) and again it was the same rinos and democrats that shot it down. Doesn't seem to be a leadership problem there, but there is a "political self-interest" and "lobbyist interest" that is very happy with the current garbage known as obamacare. Just ignore the people who can no longer afford insurance because of it, or took the penalty because it was cheaper.
Om, nomnomnom...
U.S. citizens die sooner than even U.K citizens.
Perhaps. But TFA isn't about retail medicine. It is about funding R&D. For medical R&D, America does far more than any other country. Europeans are basically freeloaders leeching off American R&D spending.
In 2015, America spent USD 47B on R&D, while Europe spent EUR 33.5B (USD ~41B):
* https://www.efpia.eu/publications/data-center/the-pharma-industry-in-figures-rd/pharmaceutical-rd-expenditure-in-europe-usa-and-japan/
That money also seems (at least in the past) to have more productive results:
* https://news.stanford.edu/pr/2009/pr-light-pharma-study-082109.html
Of the top ten Big Pharma companies, nine spend more on marketing than R&D (the one exception being Roche, with a delta of USD 300M):
* https://www.vox.com/2015/2/11/8018691/big-pharma-research-advertising