MS drug pricing not based on R&D costs, pharma execs say

Though drugmakers often claim their prices are based on the cost of a drug's research and development, a report published Nov. 25 in Neurology suggests corporate growth objectives and competition are what actually drive costs for multiple sclerosis drugs, according to STAT

Researchers talked to four anonymous drug company executives responsible for setting prices or making marketing decisions for four different MS drugs. 

One executive reportedly told the researchers, "I would say the rationales for the price increases are purely what can maximize profit. There’s no other rationale for it, because costs have not gone up by 10 percent or 15 percent; you know, the costs have probably gone down."

Other pricing factors include the ability to set prices higher in the U.S. than other countries and distortions caused by the complicated rebate system, according to STAT

"Contrary to prevailing narratives that underscore drug development costs, findings from our interviews suggest that the existing price ecosystem, overall corporate growth, international pricing disparities and supply chain–related distortions may play a more central role in drug- pricing decision," the researchers stated. 

A spokesman for the Pharmaceutical Research and Manufacturers of America, the drug industry's top lobbying group, told STAT, "The paper doesn’t address how our healthcare system is evolving toward rewarding value in healthcare. The paper also doesn’t even address the value of today’s MS medicines."

Read the full article here

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From data analytics to biosimilars — How 5 pharmacy leaders are tackling drug pricing

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