Friday, October 5, 2018

[U] "Said Another Way" Dept.: Merck's CEO Agrees That US Pharma Pricing Is... Irrational.


This is a very candid admission, at the Economic Club of New York yesterday. And it is true of all of US based pharma.

Mr. Frazier is expressing growing frustration (in a very constructive, "teaching moment" way -- as we do with all. . . children) that Trump demonizes pharma manufacturers' LIST pricing, while not bothering to understand the byzantine system which consumes half of each dollar, in middlemen / delivery "solutions".

Here is what he said, according to Yahoo Biz reporting:

. . . .“I think at the end of the day, I’ll just be blunt here, I just don’t understand why we live in a world where 50% of the value goes into the supply chain,” Frazier said. . . .

“I mean no disrespect to anyone else in the supply chain, but I know how hard it is to make my 50 cents on the dollar,” he continued. “I have to invent something that’s never existed in the history of the world. And I have to ask my shareholders to be patient with their capital. I think that the system has got to change. . . .”


He means the PBMs, the compounders, the "exclusive" distributors and yes at the raw materials end of the chain -- the CROs, and even the API manufacturers.

And that same observation is true of Pfizer, and Lilly and Baxter and Amgen. The companies making innovative treatments and therapies need to band together through PhRMA, and simply propose a private sector "disintermediation" solution (a la cable TV in the early 2000s) to the markups being charged to payers like the government and private insurers -- none of which markups ever reach far enough back in the chain to big pharma's coffers.

And (in our view) Mr. Frazier is the most-likely grown-up in the room, with the gravitas to make it happen -- even while an orange infant terrible wails in the corner, incessantly -- about the tail of the same elephant. Onward. Court -- for a TRO defense this rainy Friday afternoon. [UPDATED: There will be a LaQuan McDonald verdict, against Officer Van Dyke -- in 20 minutes now. Let justice be done. My TRO defense hearing has been cancelled; courts locked down. SO. . . I'm sitting tight in Daley Center, on the 29th floor.]

नमस्ते

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