I am going to assume that most of you taking the time to read this newsletter are aware of the four big Pharma companies competing to be the first to offer a drug that may lessen, or even prevent, migraines for the more than 36 million Americans affected by this debilitating neurological illness.
A quick review: Alder Biopharmaceuticals, Eli Lilly, Amgen, and Teva Pharmaceutical have all developed migraine drugs that have either completed or are currently undergoing Phase 3 clinical trials. The drugs contain compounds that block a protein in the central nervous system called calcitonin gene-related peptide (CGRP) that is believed to cause the relentless headaches. One positive trait of these drugs is that they can be taken by patients who cannot take triptans because of cardio vascular issues. So here we have a potential new treatment for millions of sufferers, however it comes with a cost.
The costs that are associated with research and development (R & D) of drugs are often quite extensive. CGRP antibody drugs are no exception. Millions of dollars and untold hours of R & D have been heavily invested in these products. The reason the FDA allows nearly twenty years of an initial brand name release before generic options can be made available is to allow the patent holder to profit from return on investment (ROI), exclusively. This is how CGRP antibody developers will recapture a considerable portion of the costs that went into initial research and development.
Let’s switch to a different model of how we get our medication – one that targets the “Supply Chain”. You, me, the customer, the patient – we can be thought of as one terminus of the supply chain. A growing number of people believe that that a significant containment of healthcare costs can be found in a vigorous application of Supply Chain Management (SCM). SCM may not cover all of the R & D costs, but certain applications of it have proven to demonstrate significant savings. This can be one part of a savings algorithm that must be reconciled in order to treat more than just a privileged few.
Perhaps we should expand our definition of ROI. In its most simplistic, and possibly incorrect sense, it can mean the profit enjoyed from the sale of a brand name drug. Perhaps it is time to move beyond the DuPont performance measure that dates to the 1920s. Volume metrics such as 36M potential patients and productivity measures that all serve to strengthen our economy, may play a role. Migraine losses that number in the tens of billions between healthcare costs and productivity could positively impact the medication price. A model could be devised that takes all of these variables into account and provides much needed medication, and price relief, to those who most need it.
As it stands, the initial price talk of $8,000 to $20,000 per year to treat 36,000,000 migraine sufferers in the USA is difficult to justify.
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