Has the age of the biotech blockbuster come to a close?
Over the past year, a string of would-be best-sellers, expected to generate billions in sales, have wilted into commercial disappointments amid a fractious debate about the cost of medicine. Another highly touted — and highly priced — treatment won approval on Tuesday, and the industry may soon find out whether those failures were aberrant blips or a frightening glimpse of the new normal.
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I’ve done dog and pony shows with these Wall Street types who go for a rosy Powerpoint presentation and a $2000 Zegna suit. The reality is that there are very few drugs that come close to their projections in income.
A good column, thank you, about the issues confronting the economic realities of new drugs, their pricing and their approvals.
My issue is with CVS/Caremark being both a major pharmacy benefits manager and the largest pharmacy chain store in America. On the positive side, they can negotiate large discounts for drugs in their formularies. But they can then, also, decide how much savings they pass on to consumers. They will also, sometimes, exclude a drug from coverage to try and force discounts but, if that ploy doesn’t work, leave patients without the most optimal drug or no treatment alternative at all.
On the negative side, what they decide on the insured side of their business has a direct impact on the profitability of the pharmacy chain. You can put up all the firewalls you want but it’s still one company from a reporting perspective.
And, in the middle, there is the patient who wants the best choice for their medical issue. Yes, sometimes physicians prescribe a drug that has an equal, lower-cost alternative and that’s to everyone’s benefit, other than a pharma company’s bottom line. But, a determination of what’s really best is murkier when two sides of the same company enter into a self-interested calculus unknown, and unseen, by patients and regulators.
Believing that the best decisions will always be made in the interests of the patient is a bit too altruistic for my taste.