Channel your inner Matt Damon and you might be able to understand the math in this article. We’ll cut to the chase in case you nod off. A recent article by Rachel D. Melamed & Andrey Rzhetsky indicates that “urban areas, particularly the corridor from New York to Washington, DC prefer more expensive drugs, as do parts of the southeast. Northern New England, some midwestern and western states prefer cheaper drugs. Using the demographic information on each county to predict preference for expensive drugs, we find income, health care costs and access to exercise opportunities are most predictive of expensive drug preference.” The implication from the research is that docs in urban areas prefer branded drugs, but couldn’t it be the patients? Just askin’ the question.
Seven organizations representing about 500 U.S. hospitals are joining up to make their own generics. Sick of high prices and drug shortages, the group is forming a non-profit, FDA-approved manufacturer by the name of Civica Rx. It’ll be headed up by former Amgen chief quality officer Martin Van Trieste, and its initial goal is to manufacture 14 generics for hospital patients. The exact generics Civica will focus on haven’t been named yet, but they’ll either produce them themselves, or outsource the work. You know what they say, if you want something done right, delegate it yourself.
Another week, another regulation question. Should there be a law that forces innovators to provide samples for research to generic drug developers?
Listen up, innovators. FDA head Scott Gottlieb is sick of your games (live footage here.) Specifically, he’s sick of companies that won’t provide samples of their products to generic producers, which slows down their research into developing a cheaper alternative. This essentially boils down to a non-patent-based approach to maintaining market exclusivity, and it looks like it won’t be tolerated for much longer. Not only is the FDA sounding off on the practice, but so is the FTC and even Congress. Innovators argue that regulation isn’t needed, considering the FDA approved a record number of 1,027 generics last year. The agency shot back saying it’s received over 150 inquiries from generic companies who couldn’t get the samples they needed. So what is the truth?
Teva’s been in the news a lot recently, so here’s a roundup to make sense of all of it. Going chronologically, first Teva announced it would be cutting 14,000 jobs company-wide—more than a quarter of its total workforce. The company still has a lot of debt after buying Allergan’s generics business, so they’re planning on a two-year company restructuring. Teva’s a huge deal in its home country of Israel, so this led to thousands of Israeli public sector workers striking last Sunday in solidarity with Teva workers. Israeli PM Benjamin Netanyahu met with Teva’s new CEO Kare Schultz to try to convince him to leave the company’s Jerusalem plant out of their restructuring plan, but they’re planning to go through with it anyway.
Generic company profits are eroding and, according to an article in Bloomberg, this can be traced to the upstart of family-owned drug manufacturing facilities in India. While “family-owned manufacturing facilities in India” might raise both eyebrows for people in drug markets around the globe, India’s Union Health Ministry has proposed new quality checks on its drug manufacturers. The increase in generics competition has caused downward pressure on prices, giving fits to giants like Teva, Mylan, and Sun—all of whom are feeling the squeeze. The editors at InsightCity are pleased the low-cost regions aren’t driving down our earnings. Maybe our $0 (USD) in revenue explains their lack of interest. Nah, they just couldn’t compete.
Maybe you should talk to your doctor to see if a HealthyDose™ of biosimilars is right for you. Side effects include: euphoria caused by an acute awareness of feeling yourself getting smarter, accusations of being a know-it-all by your colleagues, and more euphoria due to objectively knowing you are in fact smarter than your colleagues.
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Off-setting the post-election market bump is some downside for pharmaceuticals, specifically generics manufacturers. DOJ recently expanded its price fixing probe to investigate more than a dozen generic drug makers, with potential charges in tow. Cue textbook reaction to uncertainty in the markets: Shares plummet. Mega-manufacturer Teva felt it especially hard, with stocks taking a dip of more than 9%. Other big players like Mylan, Endo, and Impax also took solid hits. The reaction may not be entirely unwarranted considering the almost-simultaneous price jumps for several drugs across several manufacturers. The heart medication, Digoxin, recently saw an all-around sevenfold price hike, while the cost of antibiotic doxycycline increased by 121% within a few months. Looks like DOJ has some questions and investors aren’t waiting around for the answers.