And so, another working week will soon draw to a close. Not a moment too soon, yes? This is, as you know, our treasured signal to daydream about weekend plans. Once again, our agenda is quite modest. We plan to catch up on our reading — a perennial hope, hang out with our shortest person, and tidy up around the castle. And what about you? Perhaps you want to make time for someone special or try something completely different. If ambition overcomes you, you may want to plan the rest of your life. Well, whatever you do, have a grand time, but be safe. Enjoy, and see you soon …
The pharmaceutical industry is deploying economists and health care experts from top universities to lend their prestige to the lobbying blitz, without always disclosing their corporate ties, ProPublica. The example cited is Precision Health Economics, which is headed by professors at the University of Southern California and does consulting work for numerous drug makers.
Allergan chief executive Brent Saunders suggested that President Trump lead negotiations with drug makers to rein in drug prices, Bloomberg News reports. Saunders pointed to tactics used by President John F. Kennedy to keep down steel prices. Saunders also threw out the idea of waiving federal antitrust rules that currently prohibit drug makers from discussing pricing so they could create industry guidelines.
Ed, with all due respect, Mr Saunders reasoning is completely fallacious. JFK negotiated down the price of US steel because he was able to prove that the rising prices of domestic steel were creating a dangerous inflationary situation. On the other hand, the 2016 CPI chart below shows that overall prescription drug prices DROPPED 0.6% on a seasonally adjusted basis, contributing to a non inflationary CPI, at least the portion accounted for by Rx pharmaceuticals. Even if Trump is modestly successful, most large drug companies are no longer pure play drug shops. Most Big Pharma companies are fairly well diversified and are able to quickly shift pricing strategies in one area to compensate for weakness in another area. Not saying this will happen, but for example, if Abbott were forced to endure price controls on Humira, the next week granny could find that the price for a case of her Ensure has doubled or tripled.
That’s a good point, unless perhaps something more widespread is somehow put into effect so that, say, the price of Ensure also can’t rise. No idea how any of this might play out, but its certainly worth mulling over such hypotheses.
Thanks for writing in,
ed at pharmalot
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