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Drugs: exorbitant prices harm research

Inflated prices are not a sufficient incentive for drug research that is in the public interest, but conversely can be counter-productive.

It is generally thought that new drugs need to be sold at very high prices in order to support innovation, the driver for advances that bring important patient benefits.

The director of a renowned cancer centre in the USA contends however that the very high prices attained by drugs in the past few years actually hamper innovation. In the field of cancer, very high prices allow pharmaceutical companies to target tiny but highly lucrative markets, even though very few patients are concerned. This incites other companies to concentrate on those same niches and develop "me-too" drugs. The energy and money spent on these quasi-copies are not being spent in other areas where health needs are not covered.

Generally speaking, massive resources are involved, producing results that are often slender from the clinical point of view. Other US authors have shown that the 71 anti-cancer drugs (or new indications) commercialised on the US market between 2002 and 2014 for solid tumours increased the average survival rate by no more than approximately 2 months.

By developing drugs sharing the same action mechanisms and aiming at marketing authorisations for several successive indications, pharmaceutical companies are reducing some research risks and costs while maintaining very high prices. This pleases their shareholders, who are more interested in making large, easy profits than in the risks inherent in more ambitious research.

In short, high prices are not enough to incentivise drug research in the public interest, but can instead prove counter-productive.  

©Prescrire 1 October 2015

"Exorbitant drug prices harm research" Prescrire Int 2015; 24 (164): 251. (Pdf, free).

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See also:

New drug pricing:
does it make any sense?
(July 2015)

Drugs sold cheaply
to hospitals push up prices
in pharmacies
(September 2015)

Ranibizumab: reject such
high (exorbitant) prices
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35 (163): 205.
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New drugs and indications
in 2014. Some advances
this year, but many drugs are
poorly evaluated, too expensive
or more dangerous than useful
Prescrire Int 2015;
35 (159): 159 -110.
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Sofosbuvir (Sovaldi°):
dangerous pricing
(September 2014)
The high price of cancer drugs:
enough is enough
Prescrire Int 2015;
35 (156): 27.
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