Wednesday, December 08, 2004

Why Do Prescription Drugs Cost So Much??

I am a management consultant. My area of focus is Product Innovation and Lifecycle Management for the Lifescience Industry. To be specific: The Pharmaceutical Industry.

And what’s the hell is that in Realspeak?

I help pharmaceutical companies make more money. I sell them my ideas, and my time.
(I told you that I was another face in a suit, right?)

Today I was doing my usual research on industry trends, blah, blah, blah, when I came across this document published by the Pharmaceuticals Research and Manufacturers of America (aka. The Pharma Freemasonry) about the the price of prescription drugs.

Yeah, why *do* prescription drugs cost so much?

Coz you, Pharma COs, are inefficient. You only think in the short term, you only look at your annual profit margins, and you don't really care about your customers.

If you already *know* that the probability of a product going to market is only 1/5000 and it takes you 12~15 years to launch these damned drugs, why dont' you improve your efficiency at getting those golden eggs on the “shelf” faster, cheaper, and with a long range vision? If you know that the biggest portion of drug costs is attributed to R&D expenditure, not material costs, Y DON'T U DO SOMETHING ABOUT IT!

You know that clinical trials take up the biggest chunk of your R&D expenditure and development time; why don't you use your web portals and other IT tools to provide information to potential trial subjects, like the rampant bunny, provide online preliminary screening, get them to sign up, and provide their information directly to the CROs and the medical institutions so the screening process is quicker and cheaper than what you are doing today? (Oh, but we do. We have subject recruitment on our website, DWR, have a look. We are verrry efficient…)

Yeah, and I'm the Queen of Timbuktu....

(Don't try and pull that wool over my eyes, Fat Cats, I *consult* you on how to cheat the system and make more money, remember?)

Yes, you have something that looks like “on-line” recruitment, but in reality when a person sends their details online what happens is that an automatic message goes to the potential subject telling them that their info is priority #1, someone in your R&D department checks their emails everyday, sorts out the info coming in from your “Portal” and sends the information to Marketing who will call up the CROs and the medical practitioners for an appointment to assess whether these people are “fit” to be gini-pigs…. I know your drill. You don’t have a backbone system to manage these things. The only pharma company that has a something that you can call a semi-integrated patient recruitment program that connects the doctors, the CROs, the Marketing Dept. and the R&D Dept. is Amgen that uses Siebel's eClinical!! (And even *they* could do with some efficiency enhancements…)

(I haven’t been doing Business Process Reengineering and IT assessments for you guyz for nothing you know. I *know* you, Fat Catz! I have my eyes firmly on you!)

And what about your ramp-up process – going from your garage “lab” size production of the wonder drug, to the full-scale, mass produced, chug-a-lot-of-crap, bulk manufacturing process? Huh? Does R&D talk to the chemical engineers to streamline the process and cut down on the time to “ramp up” a potential drug? No.

Why? You have a box that contains R&D information which is separate from the one that contains manufacturing information. Sorry, boyz & girlz, I’ve heard about "protection of intellectual property", but isn't this taking it too far? Hello? SHARE information?? Within the company???

Talking about sharing information, why is it that you want to keep your “new molecular” entities under wraps. (I am also going to extend this question to the cosmetics industry that come up with a new “colour” for your cheek that you test on rabbits and mice, to make sure that it's safe, but guess what? Your competitor has discovered the same compound and is testing it on animals too?) I know that you have a system called “in-licensing”, i.e. buying/sharing info with your competitors but you don't put it to good use.

So we end up killing double the number of rabbits when all the drug/cosmetics companies had to do is say: hey, do you want to exchanges notes on this one? Just like we exchanged notes during college to reduce the number of hours spent in lectures. (Two heads are better than one, right?)

Two heads, less dead rabbits.

And why is it that you seem to have soooo many drugs in the pipeline to treat ailments for illnesses that are only prevalant in rich countries? You are always developing drugs for stomach ulcers, erectile dysfunction, allergies, and asthma? Hell! You know what? I have asthma, and guess what? I wouldn't have asthma if you didn't chug out those nasty fumes from your manufacturing plants that generate mountains and mountains of VIAGRA!!!! Why is it that you never invest any of your “operating capital” into R&D for creating *CHEAP* drugs to treat AIDS, malaria, dengue fever, and bird flu? Drugs that are needed by the poor people on this planet?

Pfizer, Johnson&Johnson, Merk, and GlaxoSmithKline all made gross profit margins close to 30% last year. (yes, I may be a drunken wench but I know how to do a financial analysis.) Basically they make loads of money. Actually, a shit load of money. And guess what their block-busters are? Viagra, Procrit (which had to be taken off line in Dec. 2003 coz it’s crap), Zetia & Zocor, and Serotide: drugs to treat impotence, anaemia, high cholesterol levels, and bronchial asthma. All “Rich” people’s disease.... Say no more.

(Ok, DWR, get off your damned soap box, listen to me, it’s your inner voice, Nutts. First of all who do you think is PAYING for all your expensive facials, your diving holidays, your nice dinners, and your Yoga classes. Hmm? And who is going to pay for your Yoga retreat and spa holiday in Koh Samui in January? Hmmm? Yes, it’s the “Fat Cats” that you are *dissing* right now! That’s who! Now, apologise to the nice CEOs of Pfiezer, J&J, Merk, and GSK. And make sure you tell Gordon Sink that their share of the respiratory market in Japan is really huge (thanks to that market entry strategy that we did), and that you’d be happy to do another market entry analysis for a new product launch – just tell us what you want to sell, and we’ll show you how to do it AND make loads money. Can you do that?)

...

Dear readers of DWR. I would like to retract all the above statement. My sincere apologies. I seemed to have suffered temporary insanity caused by excessive consumption of Canadian beef (or was domestic, I do not know...) during my deluxe medical over the past two days. Pharmaceutical companies are really nice. They make medicine to heal people. They don’t pollute the atmosphere, and if you go to all their sites they have a portal devoted to social issues. If all pharmaceutical products are legalised, and manufactured by these wonderful, caring, environmentally friendly, vegan, crystal yielding companies I think the world would be a wonderful place. Please rally with me on behalf of all pharmaceutical companies. Thank you. DWR
(Postscript: And yes, I love Canadian people, my good friend N is Canadian. And she eats Canadian beef, just like me. Pls don’t take offence

7 comments:

Unknown said...

For some reason this post scares me, I think its the talking about killing rabbits in the context of medical testing...just keep those cosmetics away from me.

Drunken Wench Rambler said...

yes, dear bunny. I studied pharmacology and physiology at university, and I know the realities of vivisection. Pharma companies and cosmetic companies do use mice and rabbits as "animal models" before they proceed with clinical trials on humans. I remember in my first year, they gave us a lecture on how many mice/rats get "exterminated" every year as "vermin", as opposed to the small amount that were gassed to death after being fed on/injected with the 4999 new molecular entities that are unsafe for us to take....

harsh realities. yes. but must face the truth. got to understand the enemy, before you can develop your strategy.

one thing we did tho. we always wore a tie out of respect when we performed vivisection. they all died for us. and it was our way to show our appreciation for the rabbits and lab rats.

Ouija27 said...

Interesting post there DWR. I am seeing 3 sides of you. I thought that there were only 2, odd. Anyway, you might find it interesting, or the part of you that wrote the majority of this post, will find in interesting that Micheal Moore is working on a Documentry about the cost of Prescriptions drugs, and Pharma. Co. right now. I went and saw Moore on tour in October, and he was in the process of doing research on the topic. The Pharama companies were scared, One company even released a statment to all of its employees that Mr. Moore was conducting research on the topic and if they were approached by him, the employees were to call this hot-line. Well he got the audience to call this number, and they quick filled up that voicemail box. It was quite funny. So anyway, you might want to check that film out when it is released. I know I sure will.
On yet another topic, I did not know that you worked for a Pharma co. How odd, and you do research at the university. You are quite a gifted woman, I am very glad to have gotten the chance to find your blog. I tell everybody I know about it.
One last topic back in line with Prescription drugs; I want to know what the pharma co say about pot. If it were legal, and in there hands, what would be the results? Or is not something that ever comes up? Or maybe the companies do not want it to be legal and they may be lobbying against it (which would seem more in line with business thinking - sneaking fuckers)? Any insight into this matter would be helpful.

Drunken Wench Rambler said...

WOW! I didn't know that Michael Moore was researching the subject! Cool! Yes, I would LOVE to see the film, coz I have been keeping a close eye on those Pharma CO fat cats from the outside -- as a BlogWarrior spy. I tell them how they can change their ways, while increasing their profit margins, but they pay me for my ideas and services, so I suppose altho I don't work for them, they indirectly pay for my monthly facials. I have been gathering info on their practise for YEARS now. Actually not only I have info on the Pharma COs, I also go down the chain of things and look at CROs, chemical manufacturers, utility companies... the works.

Got to look at the big picture to understand the system, you see.

As for your question about legalisation of Pot, well companies like Pfiezer have already shown *great* interest in the medicinal effects of Cannabinoids. here are some links:
Ivendus Pharma's IP751 is a cannabinoid developed as an anti-inflammatory drug. It's already out on the market.

http://www.pharmaceutical-business-review.com/companyprofile.asp?guid=9C66E1FA-FFCD-4989-8096-CAE190806F6F

Also here's a link to a US patent application for deltaTHC, one of the "active ingredient" of Gan-Ja:

http://appft1.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&p=1&u=%2Fnetahtml%2FPTO%2Fsearch-bool.html&r=8&f=G&l=50&co1=AND&d=PG01&s1=Tetrahydrocannabinol.AB.&OS=ABST/Tetrahydrocannabinol&RS=ABST/Tetrahydrocannabinol

Big Fat Cats have had their eye on pot for a while now. But unfortunately, there are so many chemicals in "pure" pot that they don't know what chemical works for what ailment. If you have not already read it, I suggest that you read Reefer Madness by Eric Schlosser (he also wrote Fast Food Nation, another interesting read).

Oh, another interesting piece of information. Japan Tabacco Inc. is the top "Pharmaceutical" company here in terms of revenue. What do they sell to us apart from cancer sticks??? Drugs to treat lung cancer??

This world is full of madness...

http://www.datamonitor.com/~97b704837922486981f29e3cffe993d0~/companies/lists/list/?listid=444472A7-6E79-4DF1-8C3F-88C973F04A8F

Ouija27 said...

You are quite the woman DWR. Every day I can log onto your Blog and be amazed. It is so very nice, maybe it is just that the simple things still excite me in life, or maybe it is just the style you got, but damn I am hooked.
So thank you for the links, I am looking into it more. While I did not quite a bit about the composite THC products, that are not really smokeables but just THC (either pure or with other drugs), I was more questioning about smokeables. Actual buds that one can pack in a nice piece of glass and socially smoke with friends and family. You know what I am saying. But the pill form seems to be different from what I have read. There are seemingly more adverse afects from the pill than from the actual smoking of bud. This is aruged from both sides, but in my research I have sided with the use of the plant as a plant and with no other manufacturing process done to the green. Well I will continue to do my thing, and just wait till I am in Amsterdam this fall to finally be in on the legal side of it all. I am indeed excited. But thank you again for the info DWR.

Drunken Wench Rambler said...

yes... unfortunately the pharma CO's are not really interested in good ol' Sensimilia... In some ways I think is a good idea; just imagine what will happen if it became a cash crop for the agro-business? The Pharmers will spray the plants with pesticide, pack it and preserve it by freeze drying it (which may actually make the quality go bad), and try to control the price of it, and prison anyone who decides to home grow because it goes against their patent laws (oops, forgot you get prisoned for it now anyway, don't you.)

They will do unto Ganja, what the tabacco companies do to us today.(do you know how many additional "chemicals" are in your average cigarette?)

The dutch approach is probably more pragmatic. Keep the coroprate fat cats away from good stuff, coz they will always try to make a profit out of your enjoyment. Most of the pot smokers are easy going, liberal people so I'm sure they don't mind if the government handles the distribution of Ganja, makes sure the prices are affordable for everyone -- now ofcourse there will be some taxation, but hey, if they inject the Ganja tax money into really good causes, like drug rehab for addicts, providing a more comprehensive and universal healthcare for everyone, like Britain's NHS system, people will be mellow enough to say. Sure, why not.

Another interesting fact: in Britain when they placed CCTVs in Soccer stadiums, the amount of hooliganism and violence rose. Why? Everyone switched from skinning up to drinking alcohol. When they removed the cameras, peace returned.

If soft drugs like pot were to be legalised you will probably see one or all of these effects:
1) less people in prison for possession of minute quanities, thus reducing the prison population.
2) less violent crimes, coz people are too stoned and chilling out on their couches. (also leading to less prision population)
3) increase in snack food sales, thus boosting the economy.

I must admit that there are going to be the downsides of legalising pot, (such as addiction, and people not wanting to work because they are stoned all the time) but we see that with alcohol and with other drugs right now anyway. Rules and Laws, I believe are meant to be challenged - that is how we develop as a society. If I have kids, I would like them to challenge me and my ideas. Otherwise life will become static and boring and we will never evolve as a race.

Ouija27 said...

I do agree with what your saying here DWR. Very good thoughts. Governmental control over my somkage would be OK if they would just give it to me all natural, but as you pointed out that would not happen. I would also be all for paying tax on the product, even as much as 20% tax, if it was legal. But since it is not, all I know is:
you gotta grow your own