Reasonable Rx: Solving the Drug Price Crisis

Reasonable Rx: Solving the Drug Price Crisis

by Stan Finkelstein, Peter Temin
Released January 2008
Publisher(s): Pearson
ISBN: 9780768681840

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Book description

A Real Planfor Making Drugs Affordable–and Promoting Innovation, Too

 “This book is a necessity for understanding the pharmaceutical industry. Both the pluses and minuses of the present system are set forth with a judicious combination of historical narrative, economic analysis, and statistical data. The highly original proposals for reform will be a major stimulant to analysis and policy-making.”

–Kenneth Arrow, Nobel Laureate in Economics, Professor Emeritus, Stanford University

“This is a timely book by authors who know what they are talking about. They tackle a big problem: rising drug prices that are threatening to overwhelm us all–and especially those with limited or absent health care insurance. Will we drive people overseas for healthcare? Will there be social unrest? This book describes the problem and then offers a solution. Worth a careful read by everyone, pharmaceutical manufacturers and government policymakers especially.”

–Roger Williams, M.D., Chief Executive Officer of the United States Pharmacopeia and a former

senior official of the Food and Drug Administration

“This book confounds two sets of skeptics: Those who say there’s no way to resolve the conflict between the need to fund pharmaceutical research and our desire to keep medicine affordable; and those who think that economics never has anything good to say.”

–Honorable Barney Frank, Congressman from Massachusetts

“This book comes at the right time and could become the starting point of discussions, which will eventually lead us into new era in the healthcare care industry. It will without a doubt become a must for insiders of the pharma- and biotech industries.”

–Dr. Jürgen Drews, retired President of Roche Pharmaceutical Group Global Research

Acknowledgments viii

About the Authors ix

Introduction xi

Chapter 1: Drugs and Drug Prices 1

Chapter 2: The American Way to Discover Drugs 21

Chapter 3: The Drug Industry Today 39

Chapter 4: Are Drug Companies Risky? 59

Chapter 5: How Not to Lower Drug Prices 77

Chapter 6: Squandering R & D Resources 103

Chapter 7: How to Lower Drug Prices 129

Appendix: Our Solution in Detail 155


Index 177

Table of contents

  1. Copyright
    1. Dedication
  2. Acknowledgments
  3. About the Authors
  4. Introduction
    1. Endnotes
  5. One. Drugs and Drug Prices
    1. The “Blockbuster” Mentality
    2. Drugs for Smaller Patient Populations Drive Costs Even Higher
    3. Business Decisions Encroach on Medical Advances
    4. Sacrificed on the Altar of “Market Size”
    5. How We Got Here
    6. Endnotes
  6. Two. The American Way to Discover Drugs
    1. A Long History of Government Involvement
    2. Produce the Drugs That Make Big Money
    3. The Link between Drug Prices and Innovation
    4. What to Do?
    5. Endnotes
  7. Three. The Drug Industry Today
    1. Antibiotics Spawn a New Industry
    2. Creating a “Sales Force” of Consumers
    3. Manipulating Patients?
    4. Another Approach to Selling Prescription Drugs
    5. Endnotes
  8. Four. Are Drug Companies Risky?
    1. The Shift to Outsourcing
    2. Outsourcing Clinical Trials
    3. What about Manufacturing?
    4. Lots More Could be Improved
    5. Endnotes
  9. Five. How Not to Lower Drug Prices
    1. “Managed Competition” in Health Care
    2. Medicare Part D and Privatization
    3. The “Untouchable” Pharmaceutical Industry
    4. Implementation Nightmares
    5. What the Medicare Part D Experience Tells Us
    6. Endnotes
  10. Six. Squandering R & D Resources
    1. Working a Broken System
    2. So Much Money, So Badly Used
    3. Business Encroaches on Our World-Class Science
    4. Withholding Unfavorable Study Results from the Public
    5. Where Are the Incentives to Meet Society’s Needs?
    6. Endnotes
  11. Seven. How to Lower Drug Prices
    1. Eliminate the Link between Drug Discovery and Prices
    2. Finance Drug Discovery with Savings from Lower Prices
    3. Undo the Blockbuster Mentality
    4. Develop the Drugs Society Truly Needs
    5. Change the Incentives
    6. Prices Will be Lower
    7. Reduce the Staggering Cost of Capital
    8. Why Use an Independent Drug Development Corporation?
    9. Funding Our Solution
    10. The Time to Act Is Now
    11. Endnotes
  12. Our Solution in Detail
    1. Establish a Nonprofit Drug Development Corporation
    2. Reorganize the Pharmaceutical Industry
    3. Set Drug Development Priorities
    4. Conduct Auctions
    5. Avoid Collusion
    6. Paying for Our Solution
    7. Endnotes
  13. Financial Times Press

Product information

  • Title: Reasonable Rx: Solving the Drug Price Crisis
  • Author(s): Stan Finkelstein, Peter Temin
  • Release date: January 2008
  • Publisher(s): Pearson
  • ISBN: 9780768681840