By: Dr. Geoffrey Modest
There was a rather poignant editorial in the NY Times on June 8th, pointing out 2 clever (though, incidentally, illegal) ways the drug companies help boost their profits by preventing/delaying the transition to generics:
- Buying off the competition — the example of Provigil: the drug company (Cephalon) first sued 4 generic drug makers for “patent infringement”, then paid them >$300 million to drop their challenge to Provigil’s patent (it turns out that Teva, one of the generic drug makers, ultimately bought out Cephalon, and the Federal Trade Commission made them pay $1.2 billion for Cephalon’s scheming)
- Drug company pulling a drug from the market which had an upcoming patent expiration, replacing it with newer formulation, and spending lots of $$ to get doctors and patients to change to the new formulation (example of Namenda for Alzheimer’s, reformulated as a once-a-day drug, so pharmacies cannot substitute a generic for it. And removing the older one from the market prior to generics being available, thereby forcing providers/patients to switch current users to the new formulation. And the new formulation would continue under a patent for years to come). The New York attorney general (Eric Schneiderman) has filed an injunction against the drug company.
see here for the editorial/
It is always striking how many new (and, in these cases, illegal) ways drug companies try to extend their profits. Unfortunately, these shenanigans are happening as many in control in the US government are promoting an agenda of less regulation/oversight. Of note, the BMJ had a remarkable article in 2012 (see BMJ 2012;344:e4348 doi: 10.1136/bmj.e4348) which did a detailed assessment of drug development and the myths of big pharma claims, noting that only 15% of drugs developed are really important new meds (most are yet another ACE-inhibitor, etc), that the stated costs of R&D are drastically overstated by totally inappropriate data and modeling, that marketing costs (included in their R&D costs) dwarf the true costs of drug development, and that drug companies are really effective in corralling the government into providing more subsidies and longer patent protections.