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ckn

Antibiotic resistance

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I assume you haven't read the article; that really makes no odds to the problems humans are facing.

 

I see Northern Sol is doing his A-level Hayekian economics lesson again.

Only on this forum are there so many chips on shoulders. Did your Business Studies teacher constantly put you down or what?

 

Perhaps you could try making a concrete point, just a thought.

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.

Why would a company spend a large amount of money to develop a product and then price it out of the market?

Antibiotics are not like any other product . The reason we are we're we are with these diseases is that antibiotics have been overused, and resistant strains have evolved.

The whole point of a new antibiotic is that, for it to be effective, us that it's use needs to be restricted.

It's got nothing to do with the price companies charge restricting the use, it's a purely medical reason.

You seem to have misunderstood my point.

 

Companies are granted a patent for a limited amount of time. During this time they can make huge amounts of money because the drug price is kept artificially high. Doctors are responsible for their budgets and tend not to prescribe such drugs unless they have to. Thus there is little chance of drug resistance building up.

 

When the patent expires then other companies can produce identikit "generic" drugs that sell for a fraction of the price under a different name. This is when problems of over-prescription start. 

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The patent is taken out when the drug is still in the lab to give the company protection over it's intellectual rights and to give it chance to recoup their investment. The patent clock starts ticking from that date. Without patent law innovation would pretty much grind to a halt across most industries (pharma, car, phone, computers, etc...). Why would a company invest millions to develop something so that everyone could then profit from selling it without having to pay anything towards the development? You seem to be confusing intellectual rights with monopoly.

 

Even once a drug has been through lab and clinical testing it then still needs to be approved by a government body. After that they then begin pricing discussions. There are plenty of drugs that have been approved but never go to market because it is just not financially viable to sell them at the price that governments set for them. The government hold a huge amount of power when it comes to dictating prices.

 

Pharma companies start discussions very early in the development process with government bodies to cover pricing to figure out will they get a price approved that makes their investment worthwhile. The role of the health economist within the pharma company has grown massively in recent years because of this, they have to look at pricing very early before the company invests millions to try and figure out whether the drug is worth bothering with from a reimbursement perspective. Most big pharma do have teams who develop drugs for non-profitable indications (often for diseases more prevalent in the 3rd world), but at the end of the day they need to make a profit or they will soon go out of business.

Intellectual rights are a monopoly where in the pharmacy industry or elsewhere but aside from that I can't really see much difference between what you have said and what I said.

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Intellectual rights are a monopoly where in the pharmacy industry or elsewhere but aside from that I can't really see much difference between what you have said and what I said.

Intellectual rights are a benefit gained from investing time, money and knowledge. When you claim that drug prices are artificially high during the patent period kindly explain how you think the economics of drug development would work if companies never recouped their costs and made a profit for reinvestment in the development of new medicines.

 

Surely generic prices are artificially low as they do not reflect the costs involved in developing those drugs and testing them to show that they are safe and effective.

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Intellectual rights are a benefit gained from investing time, money and knowledge. When you claim that drug prices are artificially high during the patent period kindly explain how you think the economics of drug development would work if companies never recouped their costs and made a profit for reinvestment in the development of new medicines.

 

Surely generic prices are artificially low as they do not reflect the costs involved in developing those drugs and testing them to show that they are safe and effective.

When a farmer sells a sack of King Edwards, the price does not include the cost of breeding the Kind Edwards breed.

 

I'm not saying that government policy is wrong, far from it. I'm saying that for the reasons you descibe a free market would not  'work'. In a free market (one where any company can participate), there would be little innovation as one company would simply copy any new product.

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When a farmer sells a sack of King Edwards, the price does not include the cost of breeding the Kind Edwards breed.

 

I'm not saying that government policy is wrong, far from it. I'm saying that for the reasons you descibe a free market would not  'work'. In a free market (one where any company can participate), there would be little innovation as one company would simply copy any new product.

No, that's because he is selling 'generic' King Edwards and he never incurred the cost of 'developing' them.

 

The free market bit occurs after the patent expires. The patent is the incentive for someone to develop something new spending their own time and money to do so. It would be great to live a purely altruistic world, but for this to be the case everyone would have to buy in and demonstrate a selfless concern for the well-being of others with nobody out to make a profit of any sort. 

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No, that's because he is selling 'generic' King Edwards and he never incurred the cost of 'developing' them.

 

The free market bit occurs after the patent expires. The patent is the incentive for someone to develop something new spending their own time and money to do so. It would be great to live a purely altruistic world, but for this to be the case everyone would have to buy in and demonstrate a selfless concern for the well-being of others with nobody out to make a profit of any sort. 

I agree, the free market occurs when the patent expires. There isn't a free market before that.

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I agree, the free market occurs when the patent expires. There isn't a free market before that.

 

Do you think there should be a free market as soon as a new drug is approved? Do you think there will ever be any new medicines if that was the case (and if so how would the development of these be paid for)?

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The bizarre thing with the industry is that when the patent expires, the original producer is immediately undercut by people who have just started making it.  It an advanced industry, having a few years head start in making a product should make you far more efficient at making it.  That is the major issue for the industry atm.

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The bizarre thing with the industry is that when the patent expires, the original producer is immediately undercut by people who have just started making it.  It an advanced industry, having a few years head start in making a product should make you far more efficient at making it.  That is the major issue for the industry atm.

A lot of companies do continue to manufacture and sell the original product alongside the generics but obviously profit margins drop as generics erode sales. Eventually they will make the decision that the manufacturing/packaging plant will be better served by using it for production of novel drugs that are on patent. Otherwise companies would need ever expanding manufacturing capabilities.

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Do you think there should be a free market as soon as a new drug is approved? Do you think there will ever be any new medicines if that was the case (and if so how would the development of these be paid for)?

I don't but I think it is inaccurate to use the term "free market" to describe monopolies created by intellectual property rights. It's also inaccurate to describe the dispensing of medicines by doctors as having much to do with the free market.

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The bizarre thing with the industry is that when the patent expires, the original producer is immediately undercut by people who have just started making it.  It an advanced industry, having a few years head start in making a product should make you far more efficient at making it.  That is the major issue for the industry atm.

It's not that unusual. Music and books are protected by similar intellectual property rights. The company that currently has the rights to Harry Potter won't necessarily be the most efficient producer of Harry Potter books when the copyright expires.

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I don't but I think it is inaccurate to use the term "free market" to describe monopolies created by intellectual property rights. It's also inaccurate to describe the dispensing of medicines by doctors as having much to do with the free market.

Back tracking a bit but did someone suggest that a free market exists anywhere when it comes to patenting new ideas? Some countries choose to ignore international patents, this seriously harms innovation.

 

You seem very hung up on drug development not being a free market, but you don't offer an explanation of how this could ever be viable if that were the case. 

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Back tracking a bit but did someone suggest that a free market exists anywhere when it comes to patenting new ideas? Some countries choose to ignore international patents, this seriously harms innovation.

 

You seem very hung up on drug development not being a free market, but you don't offer an explanation of how this could ever be viable if that were the case. 

You seem to have missed the post(s) where I said it wasn't viable any other way.

 

I objected to Bostik Bailey moaning about the obvious failure of the "free market". The free market has very little to do with it. 

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You seem to have missed the post(s) where I said it wasn't viable any other way.

 

I objected to Bostik Bailey moaning about the obvious failure of the "free market". The free market has very little to do with it.

I think you have missed the point that this thread is about antibiotics, not patent issues on products. drug companies develop drugs to, in principle at least, help medical conditions. They protect their investment in the development of these drugs through the patent system. The whole point being that the drug is effective and will be used extensively so they can sell as much as possible during the patent period.

The way antibiotics work is that their use needs to be restricted otherwise the pathogens will evolve resistance to the drugs. Hence if a new antibiotic with little or no side effects is developed, the medical profession will restrict its use, to preserve its effacity .

Therefore it is not profitable to develop antibiotics since their use will be restricted on medical grounds.

In the case of antibiotics (which is what this thread is about) the free market will not work since why would any company invest in a product that will only be use sparingly before the patent runs out?

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I think you have missed the point that this thread is about antibiotics, not patent issues on products. drug companies develop drugs to, in principle at least, help medical conditions. They protect their investment in the development of these drugs through the patent system. The whole point being that the drug is effective and will be used extensively so they can sell as much as possible during the patent period.

The way antibiotics work is that their use needs to be restricted otherwise the pathogens will evolve resistance to the drugs. Hence if a new antibiotic with little or no side effects is developed, the medical profession will restrict its use, to preserve its effacity .

Therefore it is not profitable to develop antibiotics since their use will be restricted on medical grounds.

In the case of antibiotics (which is what this thread is about) the free market will not work since why would any company invest in a product that will only be use sparingly before the patent runs out?

I missed no point because as I pointed out the initial period when the drug is only available from its original manufacturer is one where the drug is used sparingly. It generally costs too much to be used in anything but the cases when it is really necessary. Drug companies are thus able to recoup their investments.

 

It's only when the drugs are licenced as generics that the problem of overprescribing and drug resistance becomes a problem. Thus it is a problem for the NHS not the drug companies.

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Are there any drugs that can remove the apparent chip on my shoulder?

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Are there any drugs that can remove the apparent chip on my shoulder.

That was more aimed at Browny who tried to sound clever by bringing up a right-wing economist that had nothing to with what I was saying plus parroting Weary Rhinos childish put down about me having an A-level in economics (I do but I also have a degree). 

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... Weary Rhinos childish put down about me having an A-level in economics (I do but I also have a degree).

Don't hide you light under a bushell, it's not just a degree. If I remember correctly it's a degree "given to [you] by people with Masters"!

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Are there any drugs that can remove the apparent chip on my shoulder?

 

Phase III development stage.

 

Worrying side effects are that you may end up liking union but you will no longer be called a chippy northerner.

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Don't hide you light under a bushell, it's not just a degree. If I remember correctly it's a degree "given to [you] by people with Masters"!

First we had the apprentice now we have the master chippy.

 

You have nothing to say but felt the need to be unpleasant anyway.

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First we had the apprentice now we have the master chippy.

You have nothing to say but felt the need to be unpleasant anyway.

Hth

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Hth

If acting like a school boy makes you happy then go ahead. Personally if I think someone is wrong I tell them why; trying not to be rude in the process.

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Phase III development stage.

 

Worrying side effects are that you may end up liking union but you will no longer be called a chippy northerner.

Interestingly the placebo arm of the study is also having the same beneficial effect so it would appear that the chippiness is purely a state of mind brought about by too much fried food and high quality beer rather than a genuine medical condition. We await the full statistical analysis but early data analysis suggests this to be accurate with a 90% confidence interval.

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