Obscene Drug Mark Ups - PeachParts Mercedes-Benz Forum

lietuviai · #1 10-26-2009, 02:57 PM

Well we all know the drug companies make obscene profits but little did I know just how obscene they really are when it comes to ripping off an ever increasing number of sick people in the world.

The following is incredible. Make sure to keep reading to the bottom where it discusses Costco, Sam's Club, etc. The women who wrote this email and signed below are Federal Budget Analysts in Washington, DC :

Did you ever wonder how much it costs a drug company for the active ingredient in prescription medications? Some people think it must cost a lot, since many drugs sell for more than $2.00 per tablet. We did a search of offshore chemical synthesizers that supply the active ingredients found in drugs approved by the FDA.

As we have revealed in past issues of "Life Extension," a significant percentage of drugs sold in the United State contain active ingredients made in other countries. In our independent investigation of how much profit drug companies really make, we obtained the actual price of active ingredients used in some of the most popular drugs sold in America. The chart below speaks for itself.

Celebrex 100 mg Consumer price (100 tablets): $130.27 Cost of general active ingredients: $0.60 Percen t markup: 21,712%

Claritin 10 mg Consumer Price (100 tablets): $215.17 Cost of general active ingredients: $0.71 Percent markup: 30,306%

Keflex 250 mg Consumer Price (100 tablets): $157.39 Cost of general active ingredients: $1.88 Percent markup: 8,372%

Lipitor 20 mg Consumer Price (100 tablets): $272.37 Cost of general active ingredients: $5.80 Percent markup: 4,696%

Norvasec 10 mg Consumer price (100 tablets): $188.29 Cost of general active ingredients: $0.14 Percent markup: 134,493%

Paxil 20 mg Consumer price (100 tablets): $220.27 Cost of general active ingredients: $7.60 Percent markup: 2,898%

Prevacid 30 mg Consumer price (100 tablets): $44.77 Cost of general active ingredients: $1.01 Percent markup: 34,136%

Prilosec 20 mg Consumer price (100 tablets): $360.97 Cost of general active ingredients $0.52 Percent markup: 69,417%

Prozac 20 mg Consumer price (100 tablets): $247.47 Cost of general active ingredients: $0.11 Percent markup: 224,973%

Tenormin 50 mg Consumer price (100 tablets): $104.47 Cost of general active ingredients: $0.13 Percent markup: 80,362%

Vasotec 10 mg Consumer price (100 tablets): $10237 Cost of general active ingredients: $0.20 Percent markup: 51,185%

Xanax 1 mg Consumer price (100 tablets) : $136.79 Cost of general active ingredients: $0.024 Percent markup: 569,958%

Zestril 20 mg Consumer price (100 tablets) $89.89 Cost of general active ingredients $3.20 Percent markup: 2,809%

Zithromax 600 mg Consumer price (100 tablets): $1,482.19 Cost of general active ingredients: $18.78 Percent markup: 7,892%

Zocor 40 mg Consumer price (100 tablets): $350.27 Cost of general active ingredients: $8.63 Percent markup: 4,059%

Zoloft 50 mg Consumer price: $206.87 Cost of general active ingredients: $1.75 Percent markup: 11 ,821%

Since the cost of prescription drugs is so outrageous, I thought everyone I knew should know about this.

Please read the following and pass it on. It pays to shop around. This helps to solve the mystery as to why they can afford to put a Walgreen's on every corner.

On Monday night, Steve Wilson, an investigative reporter for Channel 7 News in Detroit, did a story on generic drug price gouging by pharmacies. He found in his investigation, that some of these generic drugs were marked up as much as 3,000% or more.

Yes, that's not a typo ...

3000 percent! So often, we blame the drug companies for the high cost of drugs, and usually rightfully so. But in this case, the fault clearly lies with the pharmacies themselves

For example, if you had to buy a prescr iption drug, and bought the name brand, you might pay $100 for 100 pills. The pharmacist might tell you that if you get the generic equivalent, they would only cost $80, making you think you are "saving" $20.

What the pharmacist is not telling you is that those 100 generic pills may have only cost him $10!

At the end of the report, one of the anchors asked Mr. Wilson whether or not there were any pharmacies that did not adhere to this practice, and he said that Costco, Sam's Club and other discount volume stores consistently charged little over their cost for the generic drugs.

I went to the discount store's website, where you can look up any drug, and get its online price. It says that the in-store prices are consistent with the online prices.

I was appalled. Just to give you one example from my own experience, I had to use the drug, Comparing, which helps prevent nausea in chemo patients. I used the generic equivalent, which cost $54. 99 for 60 pills at CVS.

I checked the price at Costco, and I could have bought 100 pills for $19.89. For 145 of my pain pills, I paid $72.57. I could have got 150 at another discount store for $28.08. I would like to mention, that although these are a "membership" type store, you do NOT have to be a member to buy prescriptions there, as it is a federally regulated substance. You just tell them at the door that you wish to use the pharmacy, and they will let you in.

I am asking each of you to please help me by copying this letter, and passing it into your own email, and send it to everyone you know with an email address.

Sharon L. Davis, Budget Analyst, US Department of Commerce Room 6839 Office Ph: 202-482-4458; Office Fax: 202-482-5480 Email Address: sdavis@docgov

Mary Palmer, Budget Analyst, Bureau of Economic Analysis Office of Budget & Finance; Voice: (202) 606-9295

#2 10-26-2009, 03:02 PM

There are two sides to this having working in pharmacuticals. First let me say that yes there is a huge markup and yes some of it is very unecessary and if they spent more time on R&D and less on filling the airwaves with crap the markup would not be as bad.
But in their defense they have to make a big profit on the drugs that they sell to recoup their losses. The pharmicutical business isn't like most. If they have 15 projects and 1 goes to market its been a good year. But most Pharma companies have 30-50 drugs in the R&D pipeline at all times. The cost of investigating all of these is huge, no really its huge! So when they get a drug that works they need to finance more drugs in the pipeline and make some money back.
Now as I said before they don't need to mark them up that much....

SwampYankee · #3 10-26-2009, 04:05 PM

My only frame of reference is in the golf/turf/crop protection industry. There are basic manufacturers and generic manufacturers. The basic takes the active ingredient from inception, patent, through the R&D process, then through EPA registration, through production and product support. The process from development to getting EPA approval to individual state approval (which may surpass federal standards) averages millions of dollars and 7 years per patented product. The patent is generally filed after inception so those first 7 years, money is poured into R&D and registration before the product is even brought to market and promoted leaving an average of 13 years for the basic manufacturer to first recoup their costs and then make a profit. And this is just for plant protection. Throw those costs and the liability potential on top for something a human will ingest.

Once the patent runs out, generic manufacturers jump into the market needing only EPA registration and marketing money to start selling the same active ingredient, in our industry manufactured primarily in China or India, and flood the market.

If there is no incentive to come up with new, improved or better products do you think there are companies that will just do it out of the goodness of their hearts? I don't.

MTI · #4 10-26-2009, 04:28 PM

You probably don't want to know what the raw materials of a cup of supersized Coke at McDonalds is, the raw material costs of a Starbuck's frappacino, or a new Mercedes is . . .

Skippy · #5 10-26-2009, 04:36 PM

When I worked at McDonald's years ago, the manager told us we broke even on the sandwich, made a little profit on the fries, and made most of our money on the drinks.

Txjake · #6 10-26-2009, 04:38 PM

well, good for you that you found a way to reduce your drug costs. that is the market at work. all companies that have to develop a product under government scrutiny have massive costs involved. compound that with the fact that pharma develops the actual drug that makes people better and you have a unique situation. I assure you that if you think government regulation of thier profit is going to help, you are naive. that will drive out most new drug development and leave the market for new drugs wanting.

BTW, dont look at the profit margin for aircraft parts either....

somewhat related: the insurance industry itself runs on an average of 6%...less than a lot of industries...

no, I dont work for either industry....

Pavka007 · #7 10-26-2009, 05:31 PM

I can understand your anger over this article, however there is a flip side to this.
For the last 14 years (till 2006) I was working for a pharmaceutical company (I was PM not a Doctor or medical personnel). It was American company dealing with clinical research (3rd phase only) This is the phase when for the first time a real drug is given to a real patients in clinical trials after FDA have given you green light for that.
In average study you have around 45/60 clinical sites with about 30 to 45 patients per site. Usual 3rd phase last between 6 months and 3 years.
Now I will not bombard you with numbers, I can let you do the math.

So:
One study : 45 to 60 Doctors: 90 to 120 Nurses : 1500 to 2500 patients provided with free drugs during the study, over 75% reimbursed for participating in the study. Shipping samples (overnight DHL, UPS etc, because the blood is with 48 hours window shipped in dry ice) to regional FDA approved testing Labs ; Lab costs : Production cost of this TEST drugs.... I can go for hours... and this is JUST the 3rd phase of the developing new drugs. Usually from the moment someone start developing new drug to the moment they hit the stock in your drug store take 5 or 6 phases and in average 7 years....

I don't want to argue with you, I am just laying down the facts.

Did the pharmaceutical companies make money? HELL YES, A LOT OF MONEY, but the investment before the profit is beyond your wildest dream...trust me on this one I have seen this numbers day in and day out.

Once again remember your Tylenol or Advil took between 5 and 7 years and perhaps between 10000 to 20000 people involved before you can buy it.... Not to mention that after they trow down the money during this 5 to 7 years FDA could say NO...all the investments are GONE down the drain. Perhaps you think that this would never happen...I know that could happen... I witnessed how a company have abandoned a research after 4 phases (5 years) because of FDA saying NO. Can you imagine the money they have lost?

Just saying

#8 10-26-2009, 07:37 PM

I agree with the others that this is not an appropriate way to analyze drug costs. The active ingredients are not the major expense for the drug companies. If you limit there profits, they will simply reduce their R&D efforts on drugs that they don't expect to have a large market. I don't think that is the outcome we are looking for.

I understand the frustration, I pay several $100 per month (just in co-pays) for prescriptions for a family member. I do think the system needs to be reformed, but the drug companies are not really the villains here. Would you prefer to nationalize the pharmaceutical industry?

Chas H · #9 10-26-2009, 08:11 PM

Drugs are cheaper in other countries, why is that? Before the drug companies complained and got it made illegal, busloads of seniors took organised trips to Canada to buy drugs at a considerable discount. Seems to me the free market here is a de facto subsidisation of the drug companies by Americans.

#10 10-26-2009, 08:17 PM

Quote:

Originally Posted by Chas H

Drugs are cheaper in other countries, why is that? Before the drug companies complained and got it made illegal, busloads of seniors took organised trips to Canada to buy drugs at a considerable discount. Seems to me the free market here is a de facto subsidisation of the drug companies by Americans.

That is true, so what should we do?

Do you want to limit the price of U.S. drugs (which would reduce R&D)?

Do you want to subsidize the cost of U.S. drugs (a form of national health care)?

Do you want to use tax money to pay for all R&D (nationalize the industry)?

Do you want to somehow force the industry to increase the prices of their exported products?

I don't see a free lunch (easy solution) here.

Chas H · #11 10-26-2009, 08:22 PM

Quote:

Originally Posted by Craig

That is true, so what should we do?

Do you want to limit the price of U.S. drugs (which would reduce R&D)?

Do you want to subsidize the cost of U.S. drugs (a form of national health care)?

Do you want to use tax money to pay for all R&D (nationalize the industry)?

Do you want to somehow force the industry to increase the prices of their exported products?

I don't see a free lunch (easy solution) here.

I think we should pay the same as other countries. If that's not enough for the Pharmas, then they can raise the price for everyone. I suggest you read up on how the Prescription drug Act works if you think we don't already subsidize drug costs.

#12 10-26-2009, 08:32 PM

Quote:

Originally Posted by Chas H

I think we should pay the same as other countries. If that's not enough for the Pharmas, then they can raise the price for everyone. I suggest you read up on how the Prescription drug Act works if you think we don't already subsidize drug costs.

I do understand that the U.S. customers are subsidizing drug costs. How would you resolve this without putting the U.S. government in the pharmaceutical business?

Do you believe the U.S. government has the authority to control the prices that a private business charges for their products (in the U.S. and in the rest of the world)?

Can the U.S. government tell ford that they have to charge the same price for a car in the U.S. and in mexico?

Should the U.S. reduce or remove pattern protection for drugs that they judge to be overpriced (what affect would that have on R&D)?

It's not that simple.

Pavka007 · #13 10-26-2009, 08:36 PM

Quote:

Originally Posted by Craig

I do understand that the U.S. customers are subsidizing drug costs. How would you resolve this without putting the U.S. government in the pharmaceutical business?

Do you believe the U.S. government has the authority to control the prices that a private business charges for their products (in the U.S. and in the rest of the world)?

Can the U.S. government tell ford that they have to charge the same price for a car in the U.S. and in mexico?

Should the U.S. reduce or remove pattern protection for drugs that they judge to be overpriced (what affect would that have on R&D)?

It's not that simple.

I don't know what you do for living but you are very well informed about the pharmaceutical R&D.... not many people really know how much money and effort a simple pill take.

Skippy · #14 10-26-2009, 08:41 PM

I think the answer is to have a discussion with your doctor over which drugs are appropriate, including cost as one of the many considerations, then shop around, buy generic when possible, and get the best prices whenever you can.

#15 10-26-2009, 08:43 PM

Quote:

Originally Posted by Skippy

I think the answer is to have a discussion with your doctor over which drugs are appropriate, including cost as one of the many considerations, then shop around, buy generic when possible, and get the best prices whenever you can.

I agree, that's about all the individual can do.