Drug Prices

Micheal at Econospeak pointed out this article about expensive drugs. Some doctors are cutting the dose because the drug is so expensive. One doctor even went so far as to call it economic malpractice. It can cost as much as $400,000 dollars a year for some drugs.

With Cerezyme, which is made by Genzyme, the profits are sizable. Gaucher disease, which can have complications like ruined joints, is rare; only about 1,500 people in the United States are on the drug and about 5,000 worldwide. Sales of Cerezyme totaled $1.1 billion last year, making it a blockbuster by industry standards.

Wow, $1.1 billion. I guess they have to pay for research to make the drug. Except, your tax dollars paid for it.

But critics say the company’s development costs were minimal, because the early work on the treatment was done by the National Institutes of Health, which gave Genzyme a contract to manufacture it. And analysts estimate the current cost of manufacturing the drug to be only about 10 percent of its price.

Again, wow, that is one hell of a mark up. One would think that insurance companies would want to keep prices down. They do not. They pass it along to their customers.

Ms. Mangum began treatment in 2000, at a cost of more than $400,000 a year. The next year, the premiums for everyone in her insurance pool went up by $180 a month.

I would rather have the profits from $400,000 rather than $40,000 too. It would have been nice if the reporter, Andrew Pollack, did some reporting on weather the critics were right or not. He is after all a reporter. Instead he went with what the corporation most likely lies and critics most likely truths. But we do not know.