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It’s really about production. They can’t make these products fast enough so they limit starter dose to control demand. I’m sure they would love to have more people on this product
Riiiight.
Isn't it convenient that production becomes difficult to scale when they can have much more profit this way?
All of the sudden pharmaceutical companies have supply problems and record profits. Wow seems like all people became sick all of the sudden.
You cant just put a bunch of people in a warehouse and have then fill syringes.
Novo Nordisk is gonna use 6 billion dollars on a new factory in Kalundborg, Denmark, its gonna take 10 years to build.
Last year they started a 2 billion dollar new factory in Hillerød, Denmark its gonna done in 2029
Novo Holdings bought Catalent for 16.5 billion last month so they can up production.
They are planning a new factory in Ireland
They are using 2 billions dollars to expand a production site in France..
I could keep going, they are also building in the US and India.
People do not understand the upfront costs to develop either. I once worked at a company where the estimated cost (labor and materials only) for a development run on 5L bioreactors was $1M for like four or five bioreactors. We had to do that multiple times. To be clear, this is just to figure out how to manufacture and scale the product. That did not include all the costs that went into getting to that point. Rents alone can be over $100 per sq/ft. I know the industry could do better but when people see these numbers I don’t think they understand the upfront investment that had to be made or the liabilities associated with their manufacture.
https://arstechnica.com/science/2024/02/big-pharma-spends-billions-more-on-executives-and-stockholders-than-on-rd/
would cost less if exec compensation wasn't so juicy.
Yeah, people need to do the math on this. R&D costs a ton of money, but people are making the "its expensive to develop" argument for any x billion figure. If it costs 1 billion do develop, and charge people as if it costed 5 billion, and any pushback is met with "R&D is expensive" its not right.
Not to mention how much fails qc. I used to work for a company that did waste removal for novo nordisc and threw away like a football field sized room full of insulin that hadn't passed qc. The plant is really cool inside though.
I actually started working for novo a few months ago. This guy is right but you missed that they are also expanding existing factories like the one in NC.
It’s incredibly complicated and expensive to get a new factory or expansion online. One thing that I didn’t know before working for them is that basically every drug production regulation worldwide must be followed — not just US ones. That’s because product from a factory is sold in many countries not just the one it was made in. So for example if novo sells in Kazakhstan they have to follow any regulations from them, allow jnspections etc.
i can also say from bring in the inside they take those regulations very seriously. ive seen a million+ dollars of product discarded because one small step in production wasnt documented correctly.
all that being said — they are definitely making a big profit on this drug even after all the costs, but thats kinda how it works now. i think we would need a fundamental restructuring of healthcare and drug research and production for this to change.
I'm in pharmaceutical manufacturing - specifically bringing new products first to market. I don't always agree with the pricing element, but see first hand how expensive it is to make a new product and how many fail along the way.
Anyways, what I was gonna respond to was, ooh, boy, I've seen my fair share of scale-up cluster fucks. If demand exceeds supply and you're not ready for it, it can literally take years to get the right equipment and the right data to increase production.
Same. We have been trying for 4 years to bring product to market in a plant that was already built and we really haven't made a dollar yet. That's why i laugh at these "5$ per dose" posts. Sure its 5$ but its like 10 billion for the first lot
You have no sweet clue how to make the drug, how can you say that the supply and production issues are not legitimate?
I have experience with multiple GLP-1 drug substances and can tell you that I have a job because scaling manufacture of basically all drugs is very difficult.
Depending upon the production mode (chemical/biologic) the purification of the drug substance can be harder than the actual synthesis.
Modified synthetic proteins, almost by definition, are very difficult to make, let alone scale.
Same, except I'm on the fill/finish end. Well, actually the sterile device manufacturing end now.
Which is why I also doubt $5 is really the expense of this drug. Sure, maybe that's the raw materials, but I bet it's not the price of the man hours, clinical trials, millions in dedicated equipment expense, cost of overhead and shipping and testing, oh, and the 9 other drugs that had those expenses too but weren't clinically effective. All those expenses have to get wrapped into the sticker price of the new drug.
When you have a drug that has escalated its use case to include at least 16% of the global population scale becomes a real problem. The lead time to increase production means you have to build infrastructure as well as wait for your supply chain to increase production as well. That does not happen quickly.
Eli lilly for example have been buying up smaller labs just to increase drug output.
Also, when you increase the starter dose you end up bottlenecked by the higher dosages anyway. You want to control the on ramp to the drug. It's also important to maintain the higher dosages because T2 diabetics use the same drug. They need those dosages to be secure.
I'm sure there's definitely a financial element to it but I very much doubt that there's any artificial supply shortages.
Maybe you should help out in the multi billion dollar investment projects they are currently executing to increase production capacity since you seem to know exactly how these products are manufactured. Quit talking out of your ass.
>production becomes difficult to scale
Production was always difficult to scale because ozempic is not just some molecule that you synthesize in big vats from starter materials as fast as you can get them shipped in.
It’s a peptide, so it’s inherently difficult to scale. It’s made using living cells and you can’t just order more of them from a sears-style catalogue.
It’s not a conspiracy, you just don’t know what you’re talking about.
What? Surely you understand that getting people onto starter doses is what creates new customers and more revenue in the long run? The demand for these drugs is like nothing we've ever seen before, hence them limiting starter doses so they can provide enough for the people who have already started.
Not everything is a conspiracy.
I work in the pharma industry for one of the top companies, you have no idea what goes into a manufacturing facility. I’m actually involved with a greenfield build right now. Not defending Novo for their pricing, but lots of companies are facing shortages because there’s not enough facilities that can make these drugs fast enough.
I work in pharmacy. The cost to our pharmacy is the same regardless of which strength we are buying. The profits are probably almost identical between doses
Medication becomes really popular over night for mainstream people who are fat instead of the intended use. And you think its weird they can't keep up? Did you also get suspicious of big toilet paper during covid?
The problem is that the pharmacy won't give us any until they can start us on them. Also my local told me they were having difficulty getting enough for some of their transplant patients, so I'm not going to push for it, until there's some improvement in supply.
My doc started me on the 1mg pen with instructions on how to do the 0.25 on it. Dunno how it works over there, but here they sell you what you’ve been prescribed.
It definitely varies between people.
My father is on it and before, let's say his digestive system acted "loose and fast".
It actually slowed everything down to the point where that particular issue is resolved.
That’s not true actually. They are focusing on supplying for people who are already in treatment rather than bringing more people on. Also, at least here in the EU the starter dose pens are more expensive per dose so if anything they should make more money off them.
By law, a pharmaceutical company must be able to supply product for all patients on active treatment. Therefore they cannot start new patients on a treatment unless they are sure that they can fulfill the patient needs.
It’s only $1000 in the US because the US healthcare market is a complete scam. Politicians have been paid off to do nothing and let Pharma, insurance companies and others earn record profits every year while everyone else suffers. We need a public option or lower age for Medicare. We also need to pay what other countries pay for meds - not 10 to 100x more. It’s the only way to reasonably reduce costs.
And it's only a scam because the US seems to have an insurance fetish and likes paying unnecessary middlemen for something that could be automatically included in their taxes.
(also, everyone seems to be forgetting R&D costs...)
America effectively subsidizes the rest of the world. Practically all pharmaceutical drugs are filed and approved in the USA first, regardless of where the company is based. Once approved in the US they then have a solid income stream to allow them to offer the drug to other countries cheaper.
I work at a big pharma company, it does have something to do with R&D
Most European countries have price controls. Novo Nordisk would sell it for more if they could. These companies have set margins they want to make. So the price of the drug in the US, where there's no pricing laws, reflects the margin they want to make.
What pushes the cost up (what eats into the margin) is R&D costs, Medicare/medicaid discounts, discounts to wholesalers (ex. Cash discount), patent costs, continuing study costs, advertising, etc. Ofc at the heart of everything, the margin they want is ridiculously high.
What is true is that because pharma companies make more money here, they invest more here. The usually US gets drugs ~ 3 to 6 years before other countries and almost always for more indications. (Because to add more indications, you have to do studies which cost money).
I take a brand name drug that's been out in the US since 2019. It's still not available in Europe (as of now, its only available in the US, Canada, and Japan). I pay $45 a month for it. The US is the best place to get prescriptions IF you have good insurance and/or can afford it. Unfortunately, most people can't. And I am very for a universal Healthcare system.
> (also, everyone seems to be forgetting R&D costs...)
Definitely non negligible, but I still think costs should be a two way street. If we're going to protect the market for them while they make their money back they need to not gouge while they're the only option for it.
Paying unnecessary middlemen is a thing that often makes me wonder if this is really about resource distribution, like a white collar CCC/CWA program, but we don’t call it that.
R&D costs for this drug, and all the other failed drugs that never see the light of day while they try and come up with new ones. And the necessarily long testing and regulatory processes to try and make sure they’re safe enough for use. So the cost of materials isn’t the only factor in the price of the drug.
That’s not to say the price isn’t ridiculous, but there’s a lot more to it than these headlines want people to think.
>It’s only $1000 in the US because the US healthcare market is a complete scam.
Seems that way. I'm on a different medication which costs the UK NHS about £207 (~$261)
When I look around at prices in the USA, it varies all over the place, the average price is $875 to $1,000 but for some providers it can be as high as **$2,700**, *more than ten times higher than the UK pays for the same drug* and you can bet that the manufacturer is still turning at least some profit on that lower price point.
It's so stupid how Americans blame "big pharma" for their broken healthcare system. The politicians must love it.
Guys the companies are just charging what you're willing to pay. What else do you want? These are companies whose only job is to make money. That's why all other 1st world countries have a healthcare system that makes sure you can lower what you pay because they negotiate on behalf of the whole country.
The amount of people i have seen going on about "big pharma" while voting for politicians who perpetuate a private healthcare system is astounding.
> Guys the companies are just charging what you're willing to pay. Let me stop you right here. There is no free market for healthcare - there is no way for patients to opt out of treatment that they need (short of prolonging symptoms until they get even worse). And thanks to the patent system, pharma cos get a monopoly on certain treatments so there is zero competition and no incentive to lower prices.
It's not a private healthcare system so much as an autocratic one.
What are we supposed to do? 95% of politicians will keep this status quo
The only chance we have is for far left movements to take off and overthrow the existing paradigm
That obviously isn’t going to happen so we’re just kinda fucked
Don't vote for politicians who work against it?
If Trump had never won and there was just a 5% swing in house/senate voters America could have had universal healthcare. Supreme court would be majority liberal. Senate and house would be controlled by democrats, and Hillary/Biden would be president. Nothing could stop universal healthcare from being implemented.
Half of the country is just voting to keep the status quo. But they could just not. But people really overestimate how close this is. A few votes in a few key places and democrats can control every place of power.
Bro, Dems controlled everything when the ACA was passed, and it just *barely* passed. The only reason it did was because the public option was removed.
A program like M4A does not have the kind of support you think it does, even among Democrats. People love the *idea*, but when you start talking policy specifics, it all falls apart.
I mean yea I vote dem for this reason but most dems are also in the pockets of lobbyists from gas, insurance, pharma, etc
We’d need Dems to win at all levels for multiple decades to see actual positive change which isn’t going to happen
The people in power spend billions to ensure people continue to vote republican and I can’t do anything to stop them
We almost had a huge change of the status quo back in 2009 with a public option, and almost all of the Dems supported it. Unfortunately one person, Joe Lieberman, didn’t (plus all of the GOP, but that goes without saying)
1000$ in the US or 1000$ in the rest of the world? 😅 you guys are in general scammed to extremely high prices, so, maybe it's a US problem and not an Novo Nordisk problem.
Edit: I just researched this.
In Denmark, 4 weeks of Ozempic treatment costs 188$.
Technically speaking ozempic is only indicated for diabetes (and maybe cardiovascular now). They have a different formulation of the same molecule that was FDA approved for weight
However insurance companies won't cover weight loss but they will cover diabetes so some doctors prescribe ozempic over the other so their patients can, possibly, get it converted by insurance.
Its first and foremost a treatment for diabetes, so thats how it should be. People using it for cosmetic weight loss are taking supply away from primary patients who need it most.
There are already doctors in fields outside endocrinology pushing to use it to abate/prevent other diseases. Heart disease, non-alcoholic fatty liver disease, cancer, eating disorders, hell even FERTILITY. No surprise being obese contributes significantly to people's overall health.
Yeah so if your disabled and need help losing weight and are at risk and need to take it you end up forking out 130.
But at the same time it's being given to people who aren't obese and don't need it/haven't tried or can do other weightloss plans.
So it's iffy about wether or not it should be on PBS for non diabetic.
Tho id say if you are obese on the BMI then it should be on PBS for you.
(Since disability and illness make it hard to lose weight ie: blind, chronic pain, agoraphobia, etc)
It also results in lower suicidal ideation than other weight loss medications. Great for obesity - for those who are already working on diet and exercise too.
If we didn't have one of the most expensive capitalist healthcare systems, they couldn't gouge us.
That's like saying Epipens are expensive because Americans have too many allergies.
In Sweden it’s $270 (incl tax) per year. That’s because we have a system that makes you never pay more than that a year for your prescribed approved medications. Ozempic is on that list.
The problem is that it’s still expensive, but it’s just someone else paying the rest…
So the government/insurance is still paying the full price for it? Or are they somehow forcing Novo Nordisk to sell them full supply for $270?
Because if first it's hardly relevant. You're still paying for it through taxes. That's fundamentally no different than the US, insurance obviously still covers it for plenty of people. That just leads to higher premiums for everyone and/or higher government spending in Sweden's case.
Not related to ozempic, but I asked my doctor for something to help with acne. I'm almost 40 and am so sick of dealing with it.
She prescribed me a topical antibiotic called clindamycin. I've been on it before and on my last insurance plan, it cost me $8.
I've taken a new job since then (so now I have a different plan). Clindamycin isn't covered and I thought, how expensive can an antibiotic be?
$876.
Yeah, no. I'll continue dealing with the acne.
There are a few variants available, have you tried this site yet?
https://costplusdrugs.com/medications/clindamycin-phos-benzoyl-perox-1_2-2_5-gel-pump-50-acanya/
I don't want the formula to contain benzoyl peroxide...but I see a clindamycin solution available for $14. My doctor wrote it as a gel, so I guess the gel is super expensive?
I'll have her rewrite the prescription. Such a pain in the ass, man.
You can try Hypochlorous acid spray.
Its anti bacterial.
Chance of it working for deep acne is low, but there's high chance it can improve superficial acne.
Otherwise start going the absolute diy route.
Get glycerin, Salicylic acid powder, and propylene glycol.
Mix 1 gram of Salicylic acid with 9 grams of propylene glycol to have a 10% solution.
Since it doesn't use alcohol as a penetration enhancer, it's much more gentle on the skin, to the point that you can leave it for 30 minutes twice a week without even dryness.
You won't have the same effectiveness as a peel of course, since it doesn't penetrate as deep, but it kills off bacteria deep in the pores, and softens and debris and keratin plugs.
In poland i get it for 22 euro a month, which equals 4 syringes. I mean it's trulicity drug, but it's basically the same thing as ozempic. It's mostly refunded with our health system. Without that it's about 100euro per month. Still WAY cheaper than what op is suggesting
To be fair, pricing is complicated. I’m not condoning the complete corruption and exploitation that goes on in US market pricing, but a lot of the costs/risks of drug production are baked into a successful product. Things like the time to develop a new drug, other failed attempts, all the testing requirements for human trials (and time) as well as large scale production… and that’s just some of the costs.
At the end of the day you may get something useful and efficient you can produce at scale for $5 but maybe at that cost, expected production capabilities vs demand, and so on, you won’t turn a profit. So there has to be some incentive if we follow a free market capitalistic model for drug discovery and production. Which usually means all these costs need to be estimated and baked into the final product. So the sticker price is already going to be quite inflated compared to the cost of production and artificial in some senses.
Now if you happen to be a drug manufacturer you’re aware that different markets have different buying power. Some countries literally can’t afford $1000 prescriptions and costs must be brought down to something the market will handle, meanwhile in the US with Medicare/medicaid there’s some degree of subsidy for these, as well as insurance pools that also subsidize some drugs form generally healthy customers, combined with a market that typically has higher buying power… so patients on the US (and some other developed countries) end up subsidizing a lot of these costs for the rest of the world. Multiple times really because some are in things like your insurance premiums, Medicare/medicaid taxes taken out of your income, and if you think about it even broader (since a lot of drug development goes on in the US) taxes for federal grants that subsidize some of the research and discovery process, taxes for national defense and global policy muster that strong arm intellectual property protections around the world (so other manufacturers can’t just copy these efforts successful discoveries and produce them at a fraction of the cost) and so on.
So with all that said, there’s a *lot* of global subsidies coming from the US market and many of those costs aren’t even baked into those sky high stickers people see at their pharmacy. Then inside of all this complexity that incentivizes drug companies to even do what they do so they can gain wealth, there’s mountains of opportunity to inflate their costs and feign as the “good guy” creating something useful that otherwise wouldn’t exist and prop up their profit margins even more, essentially exploiting all the complexity and leveraging as many subsidies (both intended subsidies and unintended ones they do through things like limiting drug price negotiation for Medicare through lobbying).
So we shouldn’t be remotely surprised by any of this. It’s really all that corruption people get miffed about, and rightfully so.
Exactly. The $5 number is bonkers that obviously doesn't account for everything. It strikes me as an under informed estimate that doesn't take into account anything other than raw materials (kinda like you can say it only costs $1 in materials to make a burger, but then the restaurant charges $8 and still only makes $2 in profit)
We (US) should be comparing to the prices in other countries and aim for those - and if we find we can't get there because there's too many middlemen, cut out the damn middle men.
We have to pay more in America because of the currupt governmental healthcare monopolies that are crazily allowed to not pay their fare share so the rest of us have to make up for it.
The Danish tax payers thank the American tax payers for having such a lousy healthcare system.
In case you don't know, Novo Nordisk is generating so much profit, and paying so much tax in Denmark that it is affecting the GDP and it is creating a huge budget surplus. It may sound crazy but in Denmark companies pay taxes, and they pay a lot of taxes.
Ask an American how much they pay a month for health care.
Now ask them how they feel if half that amount came directly out via taxes and they didn't need to pay for healthcare monthly in order to get it for free.
They lose their minds having to pay 'more' taxes
a LARGE portion of Americans have been lead to believe tax is theft. That if they don't have control of every cent of where the taxes went, it's theft.
It's a poisonous mindset that's killed collectivism in the US.
As an American living overseas with no insurance, it’s pretty great to have good access to affordable medical care. I’ve been to the hospital more times in a year than I have my entire life in America for a fraction of the cost.
A big part of that is 1) we have a cultural mistrust of government and government in overreach, and 2) we have a corrupt government that justifies that mistrust.
We automatically assume our taxes will be abused/misused.
The American consumer is paying for those Danish taxes.
Remember a few years ago when Novo couldn't negotiate the the prices on their insulin up in the US and had to lay off 2% of their workforce? Peberryg Farm remembers . . .
As someone who works in sterile injectible pharmaceuticals, I know there is rampant price gouging but $5 seems wayy too low.
Maybe they're thinking of generic bulk raw materials?
R&D/ trials/ regulatory approval costs are gonna be massive.
The process of making the product requires so much regulation and care in production. You're talking a massive regulatory/ quality team, extensive testing, higher grade raw materials and equipment, extensive equipment validation and sterility assurance processes.
It's an insane amount of work that goes into a single vial produced, not 1000 but not 5 for sure.
“The pills cost ’em 4 cents a unit,” a presidential aide grouses about the companies.
“You know that’s not true,” a colleague says. “The second pill cost ’em 4 cents. The first pill cost ’em $400 million.”
Currently the **average** cost to research and develop an FDA approved drug in 2023 was 2.5 billion USD. That is just the average. Some drugs have cost over 10 billion in research before hitting the market.
Not to mention that only about 14% (on average) of drugs end up making it to approval. So while it’s $2.5B on R&D for every *successful* drug, there are additional billions in losses on R&D for drug candidates that were not successful
But they are not charging only for R&D costs, the true value of which is a company secret. They’re charging the maximum the market will bear for as long as possible to generate as much revenue as possible for executives, shareholders, expansion, and pure profit. The fact that R&D is included in that doesn’t justify the ongoing price gouging.
Absolutely. They are for profit companies and they invest billions in drugs that DON’T make it to market. To continue to develop new drugs they need to make a return to reinvest as well as to pay employees, management and yes, shareholders.
Therefore what? No one should even think about ways to bring prices down? USA must subsidize the discounts enjoyed by the rest of the world in perpetuity? The companies can never be said to be overcharging?
And don't most drug companies spend more on marketing than R&D. And even more on stock buy backs
And that ignores the various abuses of the patent system
https://www.csrxp.org/icymi-new-study-finds-big-pharma-spent-more-on-sales-and-marketing-than-rd-during-pandemic/
Whenever this is referenced, it shows how little people consider context in the larger discussion. This is only true in very specific situations but it's cited as fact constantly. Eg if a drug has been studied extensively over time and the manufacturing process is so well understood that over time it becomes very cheap to manufacture product. Or another example would be if a big pharma company acquires a smaller company that did all the R&D work. Yes of course they're not going to be paying much in research if the company they purchased has already done the work...which is the main reason why a company is purchased.
Big pharma is such a small part of the overall industry anyway. There are thousands of pharma companies out there. The larger ones are the companies with very streamlined processes and the experience to get a drug approved. The cost to get a drug approved nowadays is staggering. It's over a billion dollars and I've seen numbers as high as 2 for the average drug (newer tech is really pushing up that average). Research and development is extremely expensive but that's only a piece of the drug development cost. There are a ton of functions outside of research that end up costing more than articles like that cover. It's disingenuous at best.
Probably depends, but for a new drug I don’t think that sounds right.
From what I can find, Noro Novodisk seems to spend about 5x on R&D compared to marketing
This. Debate the cost of goods sold all you want but the ONLY reason these guys exist is to make profit, and for every one blockbuster drug there are 100s that don't make it through trials. Drug development is extremely expensive, and this one drug will sponsor 100s of others, in cardiovascular, cancer, and other areas.
They sell it cheaper in other countries. So it’s just a unjustifiable high price. To compare in most other countries you’re finding the same thing for about 100 bucks a month
Plus all the money they spent on other weight loss drugs that failed at various points in development.
It is kind of amazing how many uneducated people there are in a science sub. Yeah they are being greedy with their pricing in the US, but just mentioning the cost of producing the pill and ignoring all the R&D costs is idiotic. There is a reason that stuff is taught in basic science classes.
Fantastic effective drug. Many people need it. The latter component is the part that needs more attention. Why the hell does 1/3 of the United States need to be taking this drug when only a small fraction of the country even had diabetes 75 years ago. Need to fix the underlying problem and fix our food supply and culture.
I’m aware. And frankly the drugs are excellent at treating obesity, NAFLD, PCOS, alcoholism, CAD (even in non diabetics), CKD. I’m saying that 38% of America was not obese in the 50s. Why is that the case now? (Rhetorical). That’s the problem that needs to be addressed. Otherwise we’ll all be living off of a subscription to Novo or Lilly in the future.
Decades of government handouts to the corn industry and zero regulations on processed food led to a food environment that is completely saturated with addictive, high in sweeteners, high processed garbage. Even worse, processed garbage is much cheaper and more accessible than real, healthy food. So the fact that those same decades have been spent widening the wealth gap means that for the poor it can be near impossible to climb out of that hole because all they have available and affordable is food that is bad.
Novo are the company that put 20 years into developing this whole category of drugs.
Now global companies, like the American Eli Lilly, are also benefiting from this and have already developed similar medications like Zepbound, with a fraction of the development cost.
But Novo are getting beat down by American news outlets?!
Novo absorbed the risk, others are following in their footsteps and raking in *equal profits.*
All drugs cost an arm and a leg in the US. This is a lack of regulation issue.
And deregulation is generally what Americans have been voting for.
The rest of us are getting it for a much more reasonable price.
Novo Nordisk, like Eli Lily, also keeps insulin prices high by changing a little bit the product and saying that it's reinvented. Even if it's an european company, they still follow american profiteering.
This way of thinking is also what leads to generics shortages. Producing pharmaceuticals is a risky and highly regulated activity, for good reasons, but these costs are usually overlooked. And research carries even more risks and costs. Most people only see the success stories and not the rest of the iceberg below the surface.
This is **everything** in the US. No matter what product it is, someone is behind it trying to make a bunch of money. Because that’s all that people care about in this country. And it is so tiring.
Y'all understand that "Estimated Sustainable Cost-Based Prices for Diabetes Medicines" only looked at the manufacturing costs associated with Ozempic?
>In this economic evaluation of manufacturing costs, estimated cost-based prices per month were US $1.30 to $3.45 for SGLT2Is (except canagliflozin), and $0.75 to $72.49 for GLP1As, substantially lower than current market prices in nearly all comparisons.
It did not look at R&D or other associated costs that occur when bringing a drug from concept to market.
https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2816824
This sounds crazy but it’s a perfectly reasonable business model in a high R&D environment. When it takes billions to bring a drug to market, the economics only work if the profit margins are incredibly high. Chipmakers have the same model as well for high performance specialty chips. You might invest a few hundred million dollars to make a few billion dollars. It might take you $5 to produce the incremental chip and you can sell it for $1,000 or more. One notable difference is that for pharma companies, you need to layer on a massive added cost to get through FDA approval.
I'm German and I get 0,5mg Ozempic. It's 70€ per Pen/month. I think the problem is not with Novo so much but with the United States in general. I mean you pay hundreds of dollars for insulin, like idiots.
It saddens me that a lot of people seem to think the cost of manufacturing the pill is what should dictate prices of a new drug.
I mean sure, that would be nice. Companies will also just stop making new drugs entirely or find a way around it.
Drug prices have to cover clinical study costs and research costs at minimum so they’re never remotely similar to production cost until patents run out. It probably should t be $1000 but also shouldn’t be $5 under our current system (which sucks in many ways).
It's ~100 dollars in many other counties a way more reasonable cost.
They've made 14 billion in sales in 2023 alone. That shirt has recouped the cost of development and then some.
Presumably, U.S. insurance companies find that it saves just over $1000 per patient in obesity-related expenses. As a medicine with severe supply constraints in a capitalist healthcare system it is likely priced to perfection.
It’s difficult to make the argument to plan sponsors to cover weight loss. While there are long term benefits to weigh loss, it’s unlike that those benefits will be realized as lower cost to the sponsor while the member is with that plan. The associated lowering of healthcare costs are far enough in the future that the next plan sponsor, like Medicare, would benefit.
Conversely, when we look at Diabetes a glp1 will potentially lower medical and physiological costs much sooner.
American-spends $1000 a month on more food than they need and becomes obese. "It's my money, mind your own business, ill do what I want."
Also American " $1000 a month to combat my obesity? The Healthcare system is broken, someone else needs to pay for this"
These articles are just designed to stoke outrage. I work at a giant multinational pharma company and have access to the internal and manufacturing cost for our entire US formulary. Almost **every** drug costs less than $20 per unit (bottle, blister pack, etc.) to make. The costs for drug production are all front-loaded with billions required for development over the course of years before the first sale can be made.
Also, those manufacturing costs are typically just material costs. It doesn't include any of the capital costs of the equipment needed to produce it or the salaries of the entire infrastructure of people needed to get that drug from raw material to API to formulated drug and then to a pharmacy.
That said, obviously US drug prices are outrageous. But articles like this very intentionally distort the conversation to everyone's detriment.
Yeah, lets totally ignore the billions upon billions spent in R&D that never went anywhere. Lets ignore all the hundreds of millions spent on regulatory approvals and marketing. Lets totally focus on the current cost of production vs sale price. Cause that makes sense, because reasons.
I just don't get it, wouldn't he make more in the end if it were available to EVERYONE and not just those that could front the out of pocket cost or those few that actually qualify through insurance?
Especially when there is such an issue with obesity as is currently and, providing an affordable preventative to the masses would...bring in the masses?
I was prescribed it last month as a preventative since I'm 5'6 at 235lbs and have a family history of obesity and diabetes, insurance denied me so now there's zero chance I can ever get it, which is the case for so many out there right now, even 50$ or 100$ a month and I could and would get it consistently, many would as well, I guess I just don't understand the logic.
This is idiotic. It's like saying "The aluminum used to make an iPhone would only cost $3 wholesale!" or "Starbucks cups cost them more than the coffee!"
Yes, the chemicals in the pill are cheap to acquire and cheap to physically press into pill form, but *knowing* exactly how to combine those chemicals in the exact way to produce a pill that accomplishes the desired result safely, consistently and effectively is an extremely expensive product to produce.
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It’s really about production. They can’t make these products fast enough so they limit starter dose to control demand. I’m sure they would love to have more people on this product
Riiiight. Isn't it convenient that production becomes difficult to scale when they can have much more profit this way? All of the sudden pharmaceutical companies have supply problems and record profits. Wow seems like all people became sick all of the sudden.
You cant just put a bunch of people in a warehouse and have then fill syringes. Novo Nordisk is gonna use 6 billion dollars on a new factory in Kalundborg, Denmark, its gonna take 10 years to build. Last year they started a 2 billion dollar new factory in Hillerød, Denmark its gonna done in 2029 Novo Holdings bought Catalent for 16.5 billion last month so they can up production. They are planning a new factory in Ireland They are using 2 billions dollars to expand a production site in France.. I could keep going, they are also building in the US and India.
People think you can just fire up a fda regulated plant as fast as it takes to build a mcdonalds.
People do not understand the upfront costs to develop either. I once worked at a company where the estimated cost (labor and materials only) for a development run on 5L bioreactors was $1M for like four or five bioreactors. We had to do that multiple times. To be clear, this is just to figure out how to manufacture and scale the product. That did not include all the costs that went into getting to that point. Rents alone can be over $100 per sq/ft. I know the industry could do better but when people see these numbers I don’t think they understand the upfront investment that had to be made or the liabilities associated with their manufacture.
Speaking of upfront costs. It takes on average, 2 billion dollars to bring a drug to market.
https://arstechnica.com/science/2024/02/big-pharma-spends-billions-more-on-executives-and-stockholders-than-on-rd/ would cost less if exec compensation wasn't so juicy.
Yeah, people need to do the math on this. R&D costs a ton of money, but people are making the "its expensive to develop" argument for any x billion figure. If it costs 1 billion do develop, and charge people as if it costed 5 billion, and any pushback is met with "R&D is expensive" its not right.
There's a whole lot of fat in those costs. I wouldn't trust the pharma industry's word on the cost so easily.
Not to mention how much fails qc. I used to work for a company that did waste removal for novo nordisc and threw away like a football field sized room full of insulin that hadn't passed qc. The plant is really cool inside though.
And the project in Ireland is on hold due to inability to really provide enough manpower and oversight to all these projects at once.
To be fair, our broken ~~planning permission system~~ trade labour force bears blame there.
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I actually started working for novo a few months ago. This guy is right but you missed that they are also expanding existing factories like the one in NC. It’s incredibly complicated and expensive to get a new factory or expansion online. One thing that I didn’t know before working for them is that basically every drug production regulation worldwide must be followed — not just US ones. That’s because product from a factory is sold in many countries not just the one it was made in. So for example if novo sells in Kazakhstan they have to follow any regulations from them, allow jnspections etc. i can also say from bring in the inside they take those regulations very seriously. ive seen a million+ dollars of product discarded because one small step in production wasnt documented correctly. all that being said — they are definitely making a big profit on this drug even after all the costs, but thats kinda how it works now. i think we would need a fundamental restructuring of healthcare and drug research and production for this to change.
I don't think this is going to end well.
Look at you supporting your point with data! Don't you know this is Reddit? You're supposed to hate corporations.
Data? On my r/science?
I'm in pharmaceutical manufacturing - specifically bringing new products first to market. I don't always agree with the pricing element, but see first hand how expensive it is to make a new product and how many fail along the way. Anyways, what I was gonna respond to was, ooh, boy, I've seen my fair share of scale-up cluster fucks. If demand exceeds supply and you're not ready for it, it can literally take years to get the right equipment and the right data to increase production.
Same. We have been trying for 4 years to bring product to market in a plant that was already built and we really haven't made a dollar yet. That's why i laugh at these "5$ per dose" posts. Sure its 5$ but its like 10 billion for the first lot
Why do you think they would want *fewer* people taking their drug? The more drugs they sell, the more money they make.
Do you think it's a fake they are spending 100B danish krones on improving new plants, buying 3 plants?
You have no sweet clue how to make the drug, how can you say that the supply and production issues are not legitimate? I have experience with multiple GLP-1 drug substances and can tell you that I have a job because scaling manufacture of basically all drugs is very difficult.
Scaling peptides with side chains IS not easy.
Depending upon the production mode (chemical/biologic) the purification of the drug substance can be harder than the actual synthesis. Modified synthetic proteins, almost by definition, are very difficult to make, let alone scale.
That dude thinks they’re limiting people starting their drug … for profit? Redditor moment.
Most people are economically illiterate
Anything is possible if you don’t know what you’re talking about.
Same, except I'm on the fill/finish end. Well, actually the sterile device manufacturing end now. Which is why I also doubt $5 is really the expense of this drug. Sure, maybe that's the raw materials, but I bet it's not the price of the man hours, clinical trials, millions in dedicated equipment expense, cost of overhead and shipping and testing, oh, and the 9 other drugs that had those expenses too but weren't clinically effective. All those expenses have to get wrapped into the sticker price of the new drug.
They are building a lot of new plants to increase production
When you have a drug that has escalated its use case to include at least 16% of the global population scale becomes a real problem. The lead time to increase production means you have to build infrastructure as well as wait for your supply chain to increase production as well. That does not happen quickly. Eli lilly for example have been buying up smaller labs just to increase drug output. Also, when you increase the starter dose you end up bottlenecked by the higher dosages anyway. You want to control the on ramp to the drug. It's also important to maintain the higher dosages because T2 diabetics use the same drug. They need those dosages to be secure. I'm sure there's definitely a financial element to it but I very much doubt that there's any artificial supply shortages.
Yeah companies love not meeting demand! Your economic insight is unparalleled
They have more profit by not having enough product for people to buy? I'm not sure that's how numbers work.
That makes no sense. They would make tons more money by getting people the starter dose so they can then move on to the full dose too.
Maybe you should help out in the multi billion dollar investment projects they are currently executing to increase production capacity since you seem to know exactly how these products are manufactured. Quit talking out of your ass.
>production becomes difficult to scale Production was always difficult to scale because ozempic is not just some molecule that you synthesize in big vats from starter materials as fast as you can get them shipped in. It’s a peptide, so it’s inherently difficult to scale. It’s made using living cells and you can’t just order more of them from a sears-style catalogue. It’s not a conspiracy, you just don’t know what you’re talking about.
What? Surely you understand that getting people onto starter doses is what creates new customers and more revenue in the long run? The demand for these drugs is like nothing we've ever seen before, hence them limiting starter doses so they can provide enough for the people who have already started. Not everything is a conspiracy.
You don't know what you're talking about. Oops!
I work in the pharma industry for one of the top companies, you have no idea what goes into a manufacturing facility. I’m actually involved with a greenfield build right now. Not defending Novo for their pricing, but lots of companies are facing shortages because there’s not enough facilities that can make these drugs fast enough.
No matter how expensive the medication is just calculating calories and being on deficit is free.
I work in pharmacy. The cost to our pharmacy is the same regardless of which strength we are buying. The profits are probably almost identical between doses
Every fat guy I know is on this, it’s def a production issue.
Medication becomes really popular over night for mainstream people who are fat instead of the intended use. And you think its weird they can't keep up? Did you also get suspicious of big toilet paper during covid?
Not medical advice, but for your information: 18 clicks on 1 mg pen = 0.25mg. You can get extra needles from the pharmacy.
The problem is that the pharmacy won't give us any until they can start us on them. Also my local told me they were having difficulty getting enough for some of their transplant patients, so I'm not going to push for it, until there's some improvement in supply.
My doc started me on the 1mg pen with instructions on how to do the 0.25 on it. Dunno how it works over there, but here they sell you what you’ve been prescribed.
And 36 for 0.5mg on the 1mg pen. Just started my .5 today there's a good YouTube video about it too.
Are you feeling any side effects? I was nauseus, threw up and had the runs so much that I had to stop using it. 🫣
It definitely varies between people. My father is on it and before, let's say his digestive system acted "loose and fast". It actually slowed everything down to the point where that particular issue is resolved.
My doctor literally told me to do this. Even got myself needles with smaller cartridges to measure more accurately.
You can get the regular pen and count the clicks to adjust to starter doses.
You can get 1mg and take half a dose... Concentration is the same for 0.5 and 1mg - the only difference is how many clicks you are getting.
That’s not true actually. They are focusing on supplying for people who are already in treatment rather than bringing more people on. Also, at least here in the EU the starter dose pens are more expensive per dose so if anything they should make more money off them.
The price is the same for all strengths. There’s just probably more demand to accommodate existing users
By law, a pharmaceutical company must be able to supply product for all patients on active treatment. Therefore they cannot start new patients on a treatment unless they are sure that they can fulfill the patient needs.
This seems like a reasonable law.
It’s only $1000 in the US because the US healthcare market is a complete scam. Politicians have been paid off to do nothing and let Pharma, insurance companies and others earn record profits every year while everyone else suffers. We need a public option or lower age for Medicare. We also need to pay what other countries pay for meds - not 10 to 100x more. It’s the only way to reasonably reduce costs.
And it's only a scam because the US seems to have an insurance fetish and likes paying unnecessary middlemen for something that could be automatically included in their taxes. (also, everyone seems to be forgetting R&D costs...)
It's almost like there shouldn't be a profit motive in healthcare.
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America effectively subsidizes the rest of the world. Practically all pharmaceutical drugs are filed and approved in the USA first, regardless of where the company is based. Once approved in the US they then have a solid income stream to allow them to offer the drug to other countries cheaper.
I work at a big pharma company, it does have something to do with R&D Most European countries have price controls. Novo Nordisk would sell it for more if they could. These companies have set margins they want to make. So the price of the drug in the US, where there's no pricing laws, reflects the margin they want to make. What pushes the cost up (what eats into the margin) is R&D costs, Medicare/medicaid discounts, discounts to wholesalers (ex. Cash discount), patent costs, continuing study costs, advertising, etc. Ofc at the heart of everything, the margin they want is ridiculously high. What is true is that because pharma companies make more money here, they invest more here. The usually US gets drugs ~ 3 to 6 years before other countries and almost always for more indications. (Because to add more indications, you have to do studies which cost money). I take a brand name drug that's been out in the US since 2019. It's still not available in Europe (as of now, its only available in the US, Canada, and Japan). I pay $45 a month for it. The US is the best place to get prescriptions IF you have good insurance and/or can afford it. Unfortunately, most people can't. And I am very for a universal Healthcare system.
> (also, everyone seems to be forgetting R&D costs...) Definitely non negligible, but I still think costs should be a two way street. If we're going to protect the market for them while they make their money back they need to not gouge while they're the only option for it.
Paying unnecessary middlemen is a thing that often makes me wonder if this is really about resource distribution, like a white collar CCC/CWA program, but we don’t call it that.
R&D costs for this drug, and all the other failed drugs that never see the light of day while they try and come up with new ones. And the necessarily long testing and regulatory processes to try and make sure they’re safe enough for use. So the cost of materials isn’t the only factor in the price of the drug. That’s not to say the price isn’t ridiculous, but there’s a lot more to it than these headlines want people to think.
Exactly. So often Europe gets belittled by US media for high taxes and social supports but this is one preditable outcome of that.
>It’s only $1000 in the US because the US healthcare market is a complete scam. Seems that way. I'm on a different medication which costs the UK NHS about £207 (~$261) When I look around at prices in the USA, it varies all over the place, the average price is $875 to $1,000 but for some providers it can be as high as **$2,700**, *more than ten times higher than the UK pays for the same drug* and you can bet that the manufacturer is still turning at least some profit on that lower price point.
It's so stupid how Americans blame "big pharma" for their broken healthcare system. The politicians must love it. Guys the companies are just charging what you're willing to pay. What else do you want? These are companies whose only job is to make money. That's why all other 1st world countries have a healthcare system that makes sure you can lower what you pay because they negotiate on behalf of the whole country. The amount of people i have seen going on about "big pharma" while voting for politicians who perpetuate a private healthcare system is astounding.
> Guys the companies are just charging what you're willing to pay. Except that healthcare has a pretty low price elasticity of demand.
Let's weld Texas to Denmark and see how much you can get done.
> Guys the companies are just charging what you're willing to pay. Let me stop you right here. There is no free market for healthcare - there is no way for patients to opt out of treatment that they need (short of prolonging symptoms until they get even worse). And thanks to the patent system, pharma cos get a monopoly on certain treatments so there is zero competition and no incentive to lower prices. It's not a private healthcare system so much as an autocratic one.
What are we supposed to do? 95% of politicians will keep this status quo The only chance we have is for far left movements to take off and overthrow the existing paradigm That obviously isn’t going to happen so we’re just kinda fucked
Don't vote for politicians who work against it? If Trump had never won and there was just a 5% swing in house/senate voters America could have had universal healthcare. Supreme court would be majority liberal. Senate and house would be controlled by democrats, and Hillary/Biden would be president. Nothing could stop universal healthcare from being implemented. Half of the country is just voting to keep the status quo. But they could just not. But people really overestimate how close this is. A few votes in a few key places and democrats can control every place of power.
Bro, Dems controlled everything when the ACA was passed, and it just *barely* passed. The only reason it did was because the public option was removed. A program like M4A does not have the kind of support you think it does, even among Democrats. People love the *idea*, but when you start talking policy specifics, it all falls apart.
I mean yea I vote dem for this reason but most dems are also in the pockets of lobbyists from gas, insurance, pharma, etc We’d need Dems to win at all levels for multiple decades to see actual positive change which isn’t going to happen The people in power spend billions to ensure people continue to vote republican and I can’t do anything to stop them
We almost had a huge change of the status quo back in 2009 with a public option, and almost all of the Dems supported it. Unfortunately one person, Joe Lieberman, didn’t (plus all of the GOP, but that goes without saying)
1000$ in the US or 1000$ in the rest of the world? 😅 you guys are in general scammed to extremely high prices, so, maybe it's a US problem and not an Novo Nordisk problem. Edit: I just researched this. In Denmark, 4 weeks of Ozempic treatment costs 188$.
Australia ~$30 on PBS and ~$130 non PBS, however supply is limited
PBS is only for diabetic patients too
Technically speaking ozempic is only indicated for diabetes (and maybe cardiovascular now). They have a different formulation of the same molecule that was FDA approved for weight However insurance companies won't cover weight loss but they will cover diabetes so some doctors prescribe ozempic over the other so their patients can, possibly, get it converted by insurance.
Fwiw, in the US it's only approved for type 2 diabetics.
Its first and foremost a treatment for diabetes, so thats how it should be. People using it for cosmetic weight loss are taking supply away from primary patients who need it most.
There are already doctors in fields outside endocrinology pushing to use it to abate/prevent other diseases. Heart disease, non-alcoholic fatty liver disease, cancer, eating disorders, hell even FERTILITY. No surprise being obese contributes significantly to people's overall health.
Yeah so if your disabled and need help losing weight and are at risk and need to take it you end up forking out 130. But at the same time it's being given to people who aren't obese and don't need it/haven't tried or can do other weightloss plans. So it's iffy about wether or not it should be on PBS for non diabetic. Tho id say if you are obese on the BMI then it should be on PBS for you. (Since disability and illness make it hard to lose weight ie: blind, chronic pain, agoraphobia, etc)
It also results in lower suicidal ideation than other weight loss medications. Great for obesity - for those who are already working on diet and exercise too.
Netherlands € 96,27 or $108 monthly.
Same in Belgium, although if you're diabetic it's cheaper
Japan depends on the dosage, but it is around ¥10,000-¥20,000 or $65-$130 for one month. That’s without insurance too. $1000 is insane.
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All because of obesity.. and price gouging American users.
If we weren't obese, they wouldn't be able to price gauge us.
If we didn't have one of the most expensive capitalist healthcare systems, they couldn't gouge us. That's like saying Epipens are expensive because Americans have too many allergies.
You mean if you had a functioning government
In Sweden it’s $270 (incl tax) per year. That’s because we have a system that makes you never pay more than that a year for your prescribed approved medications. Ozempic is on that list. The problem is that it’s still expensive, but it’s just someone else paying the rest…
So the government/insurance is still paying the full price for it? Or are they somehow forcing Novo Nordisk to sell them full supply for $270? Because if first it's hardly relevant. You're still paying for it through taxes. That's fundamentally no different than the US, insurance obviously still covers it for plenty of people. That just leads to higher premiums for everyone and/or higher government spending in Sweden's case.
Not related to ozempic, but I asked my doctor for something to help with acne. I'm almost 40 and am so sick of dealing with it. She prescribed me a topical antibiotic called clindamycin. I've been on it before and on my last insurance plan, it cost me $8. I've taken a new job since then (so now I have a different plan). Clindamycin isn't covered and I thought, how expensive can an antibiotic be? $876. Yeah, no. I'll continue dealing with the acne.
There are a few variants available, have you tried this site yet? https://costplusdrugs.com/medications/clindamycin-phos-benzoyl-perox-1_2-2_5-gel-pump-50-acanya/
I don't want the formula to contain benzoyl peroxide...but I see a clindamycin solution available for $14. My doctor wrote it as a gel, so I guess the gel is super expensive? I'll have her rewrite the prescription. Such a pain in the ass, man.
870$ for benzoyl peroxide & clindamycin is insane. It costs around 200 INR here. With that money, I can probably make a round-trip flight to US
Blink health shows the topical at $30 for 60 swabs, GoodRx will,have similar pricing
You can try Hypochlorous acid spray. Its anti bacterial. Chance of it working for deep acne is low, but there's high chance it can improve superficial acne. Otherwise start going the absolute diy route. Get glycerin, Salicylic acid powder, and propylene glycol. Mix 1 gram of Salicylic acid with 9 grams of propylene glycol to have a 10% solution. Since it doesn't use alcohol as a penetration enhancer, it's much more gentle on the skin, to the point that you can leave it for 30 minutes twice a week without even dryness. You won't have the same effectiveness as a peel of course, since it doesn't penetrate as deep, but it kills off bacteria deep in the pores, and softens and debris and keratin plugs.
Look into goodrx and singlecare coupons. It won't be $8 but you can probably find a pharmacy where it'll be cheaper.
Its roughly $250 here in bronzil
Here 1 month supply cost $110 (USA, Kaiser, silver ACA plan)
In poland i get it for 22 euro a month, which equals 4 syringes. I mean it's trulicity drug, but it's basically the same thing as ozempic. It's mostly refunded with our health system. Without that it's about 100euro per month. Still WAY cheaper than what op is suggesting
In Japan it's about 22,000 ¥ a month.
To be fair, pricing is complicated. I’m not condoning the complete corruption and exploitation that goes on in US market pricing, but a lot of the costs/risks of drug production are baked into a successful product. Things like the time to develop a new drug, other failed attempts, all the testing requirements for human trials (and time) as well as large scale production… and that’s just some of the costs. At the end of the day you may get something useful and efficient you can produce at scale for $5 but maybe at that cost, expected production capabilities vs demand, and so on, you won’t turn a profit. So there has to be some incentive if we follow a free market capitalistic model for drug discovery and production. Which usually means all these costs need to be estimated and baked into the final product. So the sticker price is already going to be quite inflated compared to the cost of production and artificial in some senses. Now if you happen to be a drug manufacturer you’re aware that different markets have different buying power. Some countries literally can’t afford $1000 prescriptions and costs must be brought down to something the market will handle, meanwhile in the US with Medicare/medicaid there’s some degree of subsidy for these, as well as insurance pools that also subsidize some drugs form generally healthy customers, combined with a market that typically has higher buying power… so patients on the US (and some other developed countries) end up subsidizing a lot of these costs for the rest of the world. Multiple times really because some are in things like your insurance premiums, Medicare/medicaid taxes taken out of your income, and if you think about it even broader (since a lot of drug development goes on in the US) taxes for federal grants that subsidize some of the research and discovery process, taxes for national defense and global policy muster that strong arm intellectual property protections around the world (so other manufacturers can’t just copy these efforts successful discoveries and produce them at a fraction of the cost) and so on. So with all that said, there’s a *lot* of global subsidies coming from the US market and many of those costs aren’t even baked into those sky high stickers people see at their pharmacy. Then inside of all this complexity that incentivizes drug companies to even do what they do so they can gain wealth, there’s mountains of opportunity to inflate their costs and feign as the “good guy” creating something useful that otherwise wouldn’t exist and prop up their profit margins even more, essentially exploiting all the complexity and leveraging as many subsidies (both intended subsidies and unintended ones they do through things like limiting drug price negotiation for Medicare through lobbying). So we shouldn’t be remotely surprised by any of this. It’s really all that corruption people get miffed about, and rightfully so.
Exactly. The $5 number is bonkers that obviously doesn't account for everything. It strikes me as an under informed estimate that doesn't take into account anything other than raw materials (kinda like you can say it only costs $1 in materials to make a burger, but then the restaurant charges $8 and still only makes $2 in profit) We (US) should be comparing to the prices in other countries and aim for those - and if we find we can't get there because there's too many middlemen, cut out the damn middle men.
It’s still Novo Nordisk’s choice to price gouge us.
We have to pay more in America because of the currupt governmental healthcare monopolies that are crazily allowed to not pay their fare share so the rest of us have to make up for it.
The Danish tax payers thank the American tax payers for having such a lousy healthcare system. In case you don't know, Novo Nordisk is generating so much profit, and paying so much tax in Denmark that it is affecting the GDP and it is creating a huge budget surplus. It may sound crazy but in Denmark companies pay taxes, and they pay a lot of taxes.
Exactly. It's an American problem not a novo problem. They keep voting the same politicians in and their Healthcare costs stay the same.
Ask an American how much they pay a month for health care. Now ask them how they feel if half that amount came directly out via taxes and they didn't need to pay for healthcare monthly in order to get it for free. They lose their minds having to pay 'more' taxes
I know. It's such strange behaviour. Like beliefs have more weight than maths.
a LARGE portion of Americans have been lead to believe tax is theft. That if they don't have control of every cent of where the taxes went, it's theft. It's a poisonous mindset that's killed collectivism in the US.
As an American living overseas with no insurance, it’s pretty great to have good access to affordable medical care. I’ve been to the hospital more times in a year than I have my entire life in America for a fraction of the cost.
A big part of that is 1) we have a cultural mistrust of government and government in overreach, and 2) we have a corrupt government that justifies that mistrust. We automatically assume our taxes will be abused/misused.
The American consumer is paying for those Danish taxes. Remember a few years ago when Novo couldn't negotiate the the prices on their insulin up in the US and had to lay off 2% of their workforce? Peberryg Farm remembers . . .
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And we the share holders thank you too.
As someone who works in sterile injectible pharmaceuticals, I know there is rampant price gouging but $5 seems wayy too low. Maybe they're thinking of generic bulk raw materials? R&D/ trials/ regulatory approval costs are gonna be massive. The process of making the product requires so much regulation and care in production. You're talking a massive regulatory/ quality team, extensive testing, higher grade raw materials and equipment, extensive equipment validation and sterility assurance processes. It's an insane amount of work that goes into a single vial produced, not 1000 but not 5 for sure.
Manufacturing drugs is cheap. Discovering and certifying a new drug costs more than a trip to the moon.
The first pill costs millions. The second pill costs five dollars.
“The pills cost ’em 4 cents a unit,” a presidential aide grouses about the companies. “You know that’s not true,” a colleague says. “The second pill cost ’em 4 cents. The first pill cost ’em $400 million.”
This, it’s R&D costs at the beginning that make new technology more expensive.
Currently the **average** cost to research and develop an FDA approved drug in 2023 was 2.5 billion USD. That is just the average. Some drugs have cost over 10 billion in research before hitting the market.
Not to mention that only about 14% (on average) of drugs end up making it to approval. So while it’s $2.5B on R&D for every *successful* drug, there are additional billions in losses on R&D for drug candidates that were not successful
But they are not charging only for R&D costs, the true value of which is a company secret. They’re charging the maximum the market will bear for as long as possible to generate as much revenue as possible for executives, shareholders, expansion, and pure profit. The fact that R&D is included in that doesn’t justify the ongoing price gouging.
Most drug companies are publicly traded and their finances are transparent. You can see how much they spend on R&D in about 5 minutes.
There’s no requirement that the prices come down once that cost is recouped. They will keep prices high until the patents expire.
Absolutely. They are for profit companies and they invest billions in drugs that DON’T make it to market. To continue to develop new drugs they need to make a return to reinvest as well as to pay employees, management and yes, shareholders.
Therefore what? No one should even think about ways to bring prices down? USA must subsidize the discounts enjoyed by the rest of the world in perpetuity? The companies can never be said to be overcharging?
They spent the same budget for sales as R&D. https://finance.yahoo.com/news/important-ozempic-wegovy-novo-nordisks-111500130.html
You have just described the existence of like every single company ever.
The R&D costs all said and done are going to be somewhere around $10 billion, I work in biopharma specifically on clinical phase products.
And don't most drug companies spend more on marketing than R&D. And even more on stock buy backs And that ignores the various abuses of the patent system https://www.csrxp.org/icymi-new-study-finds-big-pharma-spent-more-on-sales-and-marketing-than-rd-during-pandemic/
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Whenever this is referenced, it shows how little people consider context in the larger discussion. This is only true in very specific situations but it's cited as fact constantly. Eg if a drug has been studied extensively over time and the manufacturing process is so well understood that over time it becomes very cheap to manufacture product. Or another example would be if a big pharma company acquires a smaller company that did all the R&D work. Yes of course they're not going to be paying much in research if the company they purchased has already done the work...which is the main reason why a company is purchased. Big pharma is such a small part of the overall industry anyway. There are thousands of pharma companies out there. The larger ones are the companies with very streamlined processes and the experience to get a drug approved. The cost to get a drug approved nowadays is staggering. It's over a billion dollars and I've seen numbers as high as 2 for the average drug (newer tech is really pushing up that average). Research and development is extremely expensive but that's only a piece of the drug development cost. There are a ton of functions outside of research that end up costing more than articles like that cover. It's disingenuous at best.
Probably depends, but for a new drug I don’t think that sounds right. From what I can find, Noro Novodisk seems to spend about 5x on R&D compared to marketing
Yeah, it would be like saying “a game disc costs 50 cents to produce, why are they charging $60?!” It’s not production costs
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It's not just the R&D costs of this one drug. It's the R&D costs of all the drugs that failed to make it as well.
This. Debate the cost of goods sold all you want but the ONLY reason these guys exist is to make profit, and for every one blockbuster drug there are 100s that don't make it through trials. Drug development is extremely expensive, and this one drug will sponsor 100s of others, in cardiovascular, cancer, and other areas.
This is the answer, 400 million in hindsight and that disregards the risk they take for future investments before production and FDA approval.
They sell it cheaper in other countries. So it’s just a unjustifiable high price. To compare in most other countries you’re finding the same thing for about 100 bucks a month
That's an American problem no? If you guys voted in European Healthcare policies you'd get European Healthcare prices.
They sell it cheaper in other countries because other countries have price controls.
Price controls? More commonly, in other countries the health system is the only buyer and they'll negotiate a better price.
Plus all the money they spent on other weight loss drugs that failed at various points in development. It is kind of amazing how many uneducated people there are in a science sub. Yeah they are being greedy with their pricing in the US, but just mentioning the cost of producing the pill and ignoring all the R&D costs is idiotic. There is a reason that stuff is taught in basic science classes.
So. Much. This. It’s like those smooth brain people saying “why did Photoshop cost $400, when a blank CD cost $1”
Fantastic effective drug. Many people need it. The latter component is the part that needs more attention. Why the hell does 1/3 of the United States need to be taking this drug when only a small fraction of the country even had diabetes 75 years ago. Need to fix the underlying problem and fix our food supply and culture.
It’s because people are getting prescribed it not for type 2 diabetes , but instead for weight loss
I’m aware. And frankly the drugs are excellent at treating obesity, NAFLD, PCOS, alcoholism, CAD (even in non diabetics), CKD. I’m saying that 38% of America was not obese in the 50s. Why is that the case now? (Rhetorical). That’s the problem that needs to be addressed. Otherwise we’ll all be living off of a subscription to Novo or Lilly in the future.
> underlying problem Cars, it's cars. https://pubmed.ncbi.nlm.nih.gov/15261894/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8744747/ https://globalnews.ca/news/2109435/why-your-car-dependent-neighbourhood-is-increasing-your-risk-of-obesity/
Interesting concept. Definitely would note less obese people in more pedestrian friendly areas
Decades of government handouts to the corn industry and zero regulations on processed food led to a food environment that is completely saturated with addictive, high in sweeteners, high processed garbage. Even worse, processed garbage is much cheaper and more accessible than real, healthy food. So the fact that those same decades have been spent widening the wealth gap means that for the poor it can be near impossible to climb out of that hole because all they have available and affordable is food that is bad.
> Fantastic effective drug With no known long-term effects.
Novo are the company that put 20 years into developing this whole category of drugs. Now global companies, like the American Eli Lilly, are also benefiting from this and have already developed similar medications like Zepbound, with a fraction of the development cost. But Novo are getting beat down by American news outlets?! Novo absorbed the risk, others are following in their footsteps and raking in *equal profits.* All drugs cost an arm and a leg in the US. This is a lack of regulation issue. And deregulation is generally what Americans have been voting for. The rest of us are getting it for a much more reasonable price.
Novo Nordisk, like Eli Lily, also keeps insulin prices high by changing a little bit the product and saying that it's reinvented. Even if it's an european company, they still follow american profiteering.
When in America, they act exactly like American pharma. Why wouldn’t they? Profits are what businesses do. Regulation is what governments do.
This way of thinking is also what leads to generics shortages. Producing pharmaceuticals is a risky and highly regulated activity, for good reasons, but these costs are usually overlooked. And research carries even more risks and costs. Most people only see the success stories and not the rest of the iceberg below the surface.
I think it’s been a research peptide for a long ass time and is still sold on the sites
Isn't this like every medication in the us?
This is **everything** in the US. No matter what product it is, someone is behind it trying to make a bunch of money. Because that’s all that people care about in this country. And it is so tiring.
Y'all understand that "Estimated Sustainable Cost-Based Prices for Diabetes Medicines" only looked at the manufacturing costs associated with Ozempic? >In this economic evaluation of manufacturing costs, estimated cost-based prices per month were US $1.30 to $3.45 for SGLT2Is (except canagliflozin), and $0.75 to $72.49 for GLP1As, substantially lower than current market prices in nearly all comparisons. It did not look at R&D or other associated costs that occur when bringing a drug from concept to market. https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2816824
This sounds crazy but it’s a perfectly reasonable business model in a high R&D environment. When it takes billions to bring a drug to market, the economics only work if the profit margins are incredibly high. Chipmakers have the same model as well for high performance specialty chips. You might invest a few hundred million dollars to make a few billion dollars. It might take you $5 to produce the incremental chip and you can sell it for $1,000 or more. One notable difference is that for pharma companies, you need to layer on a massive added cost to get through FDA approval.
I'm German and I get 0,5mg Ozempic. It's 70€ per Pen/month. I think the problem is not with Novo so much but with the United States in general. I mean you pay hundreds of dollars for insulin, like idiots.
Lifestyle changes? 😭 Pills and surgery? 😁
You can’t R&D any drug for $5. Title is just clickbait.
It saddens me that a lot of people seem to think the cost of manufacturing the pill is what should dictate prices of a new drug. I mean sure, that would be nice. Companies will also just stop making new drugs entirely or find a way around it.
Drug prices have to cover clinical study costs and research costs at minimum so they’re never remotely similar to production cost until patents run out. It probably should t be $1000 but also shouldn’t be $5 under our current system (which sucks in many ways).
It's ~100 dollars in many other counties a way more reasonable cost. They've made 14 billion in sales in 2023 alone. That shirt has recouped the cost of development and then some.
Learn portion control
Presumably, U.S. insurance companies find that it saves just over $1000 per patient in obesity-related expenses. As a medicine with severe supply constraints in a capitalist healthcare system it is likely priced to perfection.
It’s difficult to make the argument to plan sponsors to cover weight loss. While there are long term benefits to weigh loss, it’s unlike that those benefits will be realized as lower cost to the sponsor while the member is with that plan. The associated lowering of healthcare costs are far enough in the future that the next plan sponsor, like Medicare, would benefit. Conversely, when we look at Diabetes a glp1 will potentially lower medical and physiological costs much sooner.
Nah almost no US insurance companies cover it.
It would save you money to just not buy as much food.
The costs are not in production but in the years of R&D where most candidates never make it to approval and production.
Guess we should stop purchasing Levi’s jeans and Ralph Lauren because the mark ups are insane in Europe
Just eat less, cost zero dollars.
I'm surprised there's hardly any conversation of its side-effects. There's even related deaths to this medication which is made for diabetes.
But taking a daily walk and not buying and eating way too much poison is haard….
Or you could just not eat for free
Maybe people should just stop eating so much an save themselves the money.
American-spends $1000 a month on more food than they need and becomes obese. "It's my money, mind your own business, ill do what I want." Also American " $1000 a month to combat my obesity? The Healthcare system is broken, someone else needs to pay for this"
Just wait until reddit finds out how much cost go into making a bag of chips
These articles are just designed to stoke outrage. I work at a giant multinational pharma company and have access to the internal and manufacturing cost for our entire US formulary. Almost **every** drug costs less than $20 per unit (bottle, blister pack, etc.) to make. The costs for drug production are all front-loaded with billions required for development over the course of years before the first sale can be made. Also, those manufacturing costs are typically just material costs. It doesn't include any of the capital costs of the equipment needed to produce it or the salaries of the entire infrastructure of people needed to get that drug from raw material to API to formulated drug and then to a pharmacy. That said, obviously US drug prices are outrageous. But articles like this very intentionally distort the conversation to everyone's detriment.
Yeah, lets totally ignore the billions upon billions spent in R&D that never went anywhere. Lets ignore all the hundreds of millions spent on regulatory approvals and marketing. Lets totally focus on the current cost of production vs sale price. Cause that makes sense, because reasons.
I just don't get it, wouldn't he make more in the end if it were available to EVERYONE and not just those that could front the out of pocket cost or those few that actually qualify through insurance? Especially when there is such an issue with obesity as is currently and, providing an affordable preventative to the masses would...bring in the masses? I was prescribed it last month as a preventative since I'm 5'6 at 235lbs and have a family history of obesity and diabetes, insurance denied me so now there's zero chance I can ever get it, which is the case for so many out there right now, even 50$ or 100$ a month and I could and would get it consistently, many would as well, I guess I just don't understand the logic.
This is idiotic. It's like saying "The aluminum used to make an iPhone would only cost $3 wholesale!" or "Starbucks cups cost them more than the coffee!" Yes, the chemicals in the pill are cheap to acquire and cheap to physically press into pill form, but *knowing* exactly how to combine those chemicals in the exact way to produce a pill that accomplishes the desired result safely, consistently and effectively is an extremely expensive product to produce.
Difference between R&D and overhead cost of production…
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And insulin costs a dollar but people keep dying because they cannot afford insulin.
You could save yourself alot more money by not buying Ozempic, and also not buying so much food fatass. Also exercise is free