What Would Jesus Charge?

[goofyfish]

Schering-Plough sells a hepatitis C medication called Rebetol for ten bucks a capsule, a markup of roughly ten thousand percent over manufacturing costs estimated at a dime a capsule.

The patent ran out in June, and so Schering-Plough is acting as any respectable drug company would under the circumstances. It is trying to twist the patent laws in such a way as to block another company from selling the drug at half price to the country's four million hepatitis C sufferers (many of whom are H.I.V. positive, too.)

Steven Lieberman, a patent lawyer at Rothwell, Figg, Ernst & Manbeck in Washington, said that drug companies are increasingly trying to block lower-cost competition by taking advantage of federal laws requiring generic and brand name drugs to have the same labeling.

The labeling issues have become a minefield for the F.D.A., said Mr. Lieberman, who represents the makers of both generic and brand name drugs. Regulators know, he said, "whatever move they make, they are likely to be sued by one side or the other."

Ten dollars a pill strikes Schering-Plough as a perfectly reasonable amount to charge. Company spokesman Robert J. Consalvo makes the case:

Products typically are not priced at the cost to make them. They're priced at the value they bring to the patient. (Full text here – registration required)

Or as The Bible put it, "The lamb that suffereth the most, that lamb may be made also to pay through the nose." (Ecclesiasticus XXI, 6)

:m: Peace.

 

[zanket]

Manufacturing costs may be puny but what if the medication took a billion dollars to develop? What if most of their drugs don’t reach the market after years of research? Schering-Plough’s profit margin was “only” 18% last year. Prices typically match perceived value.