It shows you how stupid and greedy people and algorithms can be. They take unvetted input and blindly run with it? Really? That existed long before Twitter. It's not Twitter's fault that stupid scales so easily.
When will The Media and Wall Street - and political leaders? - learn that Twitter is a source of info *that must be vetted*. Ignoring that fact, and letting your internal biases get the best of you is simply not an option *anywhere on the internet*.
The commenter didn't say it was Twitter's fault, just that this shows its power. That power could be attributable, in part at least, to people's gullibility, mobthink, etc. (Personally I think there is some responsibility on Twitter's part as well - after all, they suddenly made it possible to buy unvetted Blue Checks, when until recently that mark was a sign of confirmed identity.)
The ONLY way to authenticate someone on twitter has been those check marks. And this week that all went to hell.
It is the same thing on tiktok they have verified accounts and I know that someone at tiktok verified this is X.
Up until this week those blue checks meant something and people who are not in the new cycle would not have known. I/We are in the news cycle because we are nerds/techies.
The whole market may have been heading down but this contributed.
Pro tip: If you want to have a constructive adult discussion, don't lede with "You're wrong."
And for the record, you don't just vet source, you vet the information itself. If it can't be confirmed and you act anyway...well that is by defintion child's play.
If children - *in adult bodies* - want to play in traffic on Twitter, it's not Tw's job to police them, or change their diapers when they shat their pants.
Yup yup. I should not have lead with you are wrong.
But the blue check mark is really how most people (myself included) decide if a source is real on twitter. And that was destroyed this week by someone who apparently does not actually understand how twitter works.
So assuming a lot of people also trust that check mark and now what should be a good reliable source of information gave out something that is false. It was clearly part of it.
Was that the only reason the stock dropped? Probably not. The stock market is effectively random and only barely involved in reality.
> Eli Lilly’s insulin products sold $878 million in one quarter alone recently. Again lilly’s main insulin is at 43-60x price markup! It’s almost all profit!
> Lilly, Novo & Sanofi together supply 100% of all insulin in the US, and 90% of entire world!
All the other details aside, this doesn't feel okay and I cannot believe that elected officials voted against legislation to prevent this sort of a markup situation. Whatever happened to them needing to represent the interests of the people?
Human insulin is available without a prescription for around $25 a vial at Walmart. That is what most diabetics would have used 20 years ago before the drug companies developed analog insulin versions that are easier to use. Analog insulin is available with a prescription for around $75 a vial at Walmart. About 1 in 7 Walmart shoppers have diabetes.
I don't know if it's accurate, but this suggests that on average, diabetics use 2-3 vials per month. So that would be $50 to $75 a month.
However, it also mentions that some people need 50-60 units per meal and a vial contains 1000 units. Assuming three meals per day, someone using 50 vials per meal would spend $666.66 per month.
$666.66 per month would be prohibitively expensive for many people and even $50 to $75 could be a significant expense for people making minimum wage (depending on local minimum wage it could be equivalent to 7-8 hours of work before taxes).
More context: the insulin dose diabetics take with meals is called a bolus dose. However, cells in the human body need glucose uptake constantly, 24 hours a day. So T1 diabetics also have to take a basal insulin dose either once daily as an injection or continuously on a pump. In addition to that, diabetics need to take correction bolus doses to lower their blood glucose when it's high not as a result of a meal, and sometimes they have snack or meals other than just the 3 meals a day. The basal and bolus ratio is around 50% : 50% for some people, although it depends on their doctor and a lot of different factors. So, to recap - there are food boluses, correction boluses, and basal doses.
Here's how I would do the math: 50 units per dose x 3.5 meals on average x 2 for basal = 350 units a day. Or 0.35 vial per day, and 10.7 vials per month. Assuming synthetic human insulin and not insulin analogue is used, that means about $270 per month.
However, some caveats:
- synthetic human insulin is not fast enough for most carbohydrates in meals, and it results in higher blood glucose spikes immediately after a meal than using an insulin analogue. The higher the blood glucose, the more insulin it takes to lower it the same amount. Moreover, we only have so many hours in the day, and slower acting synthetic human insulin needs time to work. So people using it are more likely to "overcompensate" and then eat a bit later to offset their dose. This is a very long-winded way of saying that a person might need slightly more synthetic human insulin than analogues, plus synthetic human insulin in general is less effective.
- In my calculations, I did not include correction bolus doses, insulin used to prime needles, and pump infusion sets (although probably very few people use human synthetic insulin in pumps anyways). I also did not include insulin that is spoiled in some way (refrigerator breakdowns, reserve insulin taken on trips that's not refrigerated, heatwaves, and so on).
- Most people use between 70 and 110 units of insulin per day, whether that's a combination of an insulin analogue and basal insulin injections, or using insulin analogue in a pump. I don't know how much synthetic human insulin is used per day on average, probably a bit more.
So I would say in practice, for someone who uses that much synthetic human insulin, the cost can be even $400 per month. For analogues, it would be much, much higher.
I think it makes sense for me to provide a source for all this - I care for someone with T1 diabetes and am somewhat connected with the broader T1 community.
Analogues are not only easier to use, but also allow for regimens and therapies (such as insulin pump therapy) that somewhat improve life expectancy and significantly improve quality of life.
The relatively inelastic demand of insulin analogues when synthetic human insulin is available shows how important analogues are to T1 diabetics.
Sometimes pharma companies try to allude to analogues being a luxury good compared to synthetic human insulin. But to T1 diabetics this notion is generally ridiculous. Analogue insulins allow them to regain a little bit more quality of life lost to the disease, and that should be a human right when insulin manufacturing costs are so low.
No, it's because our government negotiates on behalf of all Canadians. And we are a very big healthcare market (even with a small population) since we all participate in the health care system – since it's public.
Doesn't that go both ways? Eli Lilly is a huge organization negotiating in favor of higher prices, so it makes sense that a huge organization (i.e. the government or insurance companies) would be needed to negotiate against them.
Even if there is a power imbalance between Eli Lilly and the Canadian Government, there would also be a power imbalance if it was instead Eli Lilly vs. individual consumers.
Eli Lilly actually doesn’t negotiate for higher prices. I’ve had somewhat more insight than the average person into how the dynamics of the insulin pricing work, and it’s a total abomination, largely born out of a lack of a universal public insurance option in the US.
Despite the skyrocketing costs of insulin over the decades, Eli Lilly’s profits per unit are mostly in line with inflation. This is because in the US system, there is a pervasive system of rebates that exists between pharmaceutical companies and insurers. Insurers often may only pay 10% of what the sticker price is for insulin. But the way these rebates get negotiated through third party firms known as PBMs create a system that incentivizes insulin that is marked up an incredible amount and then discounted to X, than simply pricing it at X in the first place. But this obviously screws over anyone without access to the rebate, i.e. those without insurance. And this system largely exists because the privatized nature of insurance in the US. If there was some kind of universal medicare in the US, undermines those incentives and the market would normalize immediately.
> If there was some kind of universal medicare in the US
You don't even need that. Just more/better regulation would suffice. You have countries with fully privatized healthcare systems like Switzerland or partially privatized ones like Germany or Netherlands which have no such problems.
> The problem is the regulation that mandates people have insurance or be punished
Which is the cornerstone of any universal healthcare system? It only works in other countries if the healthy subsidize the costs of those less fortunate.
Also Switzerland had compulsory fully private insurance. To be fair they do suffer from similar issues as the US. Healthcare prices are very inflated compared to the surrounding countries, accessibility to some services (e.g. dental) is poor for low income individuals etc.
Of course it helps that Switzerland is a quite homogenous, has low inequality and subsidize access for low income individuals. However inherently the system is not that different from the one in US (I mean Switzerland is closer to US than either is to Britain).
The negotiation goes like this: "Here's what we'll pay you for that. If you don't like it, we'll ignore your patents and intellectual property and manufacture it ourselves."
The companies would rather prevent Canada from funding competition, so they just jack up prices in the US to compensate.
If the US passed a law requiring sales of drugs in the US to match the lowest sale price in any other country, one of 2 things would happen.
The likely thing is that innovation would come to a standstill. Money goes to where it can make the most money. No money in drugs? No new drugs.
Or, the companies would get a lot more hard nosed about sales in countries with price controls, and there would be trade wars between the US and those countries. And then you would see higher prices in Canada.
> If you don't like it, we'll ignore your patents and intellectual property and manufacture it ourselves
Citation?
> so they just jack up prices in the US to compensate.
Pharmaceutical companies charge as much as they can anywhere, including in the US. They wouldn't entertain reducing prices in the US even if the Canadian market were different.
Any time there are price controls, there is scarcity. That is, unless the price controls are subsidized in some way like in the situation we're talking about.
I like the innovative drugs that are being made, so I'm not in favor of price controls.
If you think drugs are too expensive, then do something about it. Create some useful drugs and sell them for a cheaper price.
> Any time there are price controls, there is scarcity
That's not true. It would be the case for (close to) perfectly competitive markets with lower margins, like petrol, basic foodstuffs to some extent etc. It does not apply to markets controlled by oligopolies/monopolies. Especially pharmaceuticals where margins are extremely high and producers of some drugs would still be able to make a profit if they cut (list) prices by a magnitude or two.
Only argument against is that it might decrease available funding for developing new drugs, which might be a legitimate concern. But in no way would reasonable prices controls result in a scarcity of almost all currently available drugs.
" When inventor Frederick Banting discovered insulin in 1923, he refused to put his name on the patent. He felt it was unethical for a doctor to profit from a discovery that would save lives. Banting’s co-inventors, James Collip and Charles Best, sold the insulin patent to the University of Toronto for a mere $1. They wanted everyone who needed their medication to be able to afford it.
"
There is no "IP in Canada for Insulin given UofT "owns" the patent.
Most of the price differences between US and Canada stems from the difference in patents and trademarks. Canada has far more "Generics" vs the US.
Actually, the health system that Canada has did not start until 1947, and the product you are talking about is literally not the product under discussion.
> The likely thing is that innovation would come to a standstill. Money goes to where it can make the most money. No money in drugs? No new drugs.
There are pharmaceutical companies all around the world, while it's true that the US currently has the largest market cap for pharma companies, it's not like the rest of the world is sitting on it's hands. Of the top 15 largest pharmaceutical companies in the world, 8 are in the US, and 7 abroad. But market cap is a poor metric for impact, especially in the US, where it seems the market can price a social media company with no profit at 44billion, I'm not particularly convinced by valuations on pharmaceutical companies who's share pricing rely on price gouging and a indentured customer base to stay high.
Another perspective is that while they're able to sell insulin at 40x cost, something they developed decades ago, what's their incentive to develop new drugs? In countries where companies are required to provide licensing for generics after a certain time period, they would be incentivized to continue developing new drugs in order to keep products on the shelves that are in the exclusive licensing window.
Regardless of any of the above, what you're essentially advocating for is fleecing US citizens to the benefit of the rest of the world. I'm just not sure how this could possibly be a good thing for the US.
The US, out of its immense generosity is subsidizing canada?
News flash, Insulin was discovered here (canada).. so how exactly are you subsidizing a Canadian discovery?
How about this for a far more realistic explanation:
"
When inventor Frederick Banting discovered insulin in 1923, he refused to put his name on the patent. He felt it was unethical for a doctor to profit from a discovery that would save lives. Banting’s co-inventors, James Collip and Charles Best, sold the insulin patent to the University of Toronto for a mere $1. They wanted everyone who needed their medication to be able to afford it.
It is tone deaf, I agree. But it should be noted that the insulin you are talking about is about $20 at Walmart these days, which given inflation going back to the 1920s, is incredibly cheap.
The insulin that is incredibly expensive these days, that people drive to Canada for, is analogue insulin, which was developed in the last several decades by the pharmaceutical companies and is far more efficacious and easy to use. It’s a completely different product, which is often missed when these discussions of the donation of the original insulin patent is brought up.
Say a big pharma company spends $100M on a new drug - R&D, trials, certifications in US. They sell it for $100 a tablet in US for a couple years, at which point they have paid off their investments and made a small profit. Now they negotiate deliveries of the drug to say Canada.
First Canada's drug administration confirms the drug is approved by the FDA and approves it for use in Canada without further test, trials, etc. Second as the production costs almost nothing any price the pharma company gets is almost pure profit. So the price in Canada ends up at $1 a tablet.
Now think what would've happened if US didn't exist. All the R&D, trials, etc. would have to be paid by all the other countries in the world. There would be far fewer new drugs being developed and they would cost a lot more.
> All the other details aside, this doesn't feel okay and I cannot believe that elected officials voted against legislation to prevent this sort of a markup situation. Whatever happened to them needing to represent the interests of the people
Note that those markup figures are based on production cost, excluding capital investment. Lilly is profitable, but not any more profitable than Google or Facebook or Apple.
Making critical products less profitable than less critical ones is often contrary to “the interests of the people.” It drives investment from stuff like new pharmaceuticals to stuff like dating apps.
Insulin is actually a perfect example of that. The first generation insulins now are relatively cheap. The “insulin” we’re talking about here are second-generation insulin analogs, which are easier to administer and help better control blood sugar levels. We are at the tail end of the patents on those and we are already starting to see generic insulin analogs being made at Wal-Mart.
You have to think about the system in terms of how humans work and their motivations. Brilliant people who can make new, better insulin aren’t born any more altruistic than the people whose talents are better suited to coming up with new advertising algorithms. They want to make a bunch of money from their work. If you make it so that smart people can make more money doing an ad-tech startup rather than a bio-tech startup, that’s what they’ll do.
How does this jive with the fact that they increased the price of these insulin more than 10x over the last decades[0]? Poor souls must've just been keeping up with inflation over there at the pharma lot.
You are being downvoted but you are entirely correct. Pricing for medications in the US, including insulin, follows an absolutely nightmarish set of rituals due to the need to gain access through insurers. Eli Lilly’s financials are publicly available, their revenue per unit of insulin has largely kept pace with inflation. The skyrocketing costs of the sticker price of insulin is entirely due to the lack of a universal public insurance option in the US leading to the horrific rebate system we currently have, which largely benefits insurers and PBMs. Pharma companies come out neutral (from a revenue perspective, definitely negative from a PR perspective), and consumers, particularly those on high deductible plans or without insurance, are gutted.
I haven't downvoted, but if you look there the original price was ~$20, now the net that the other user shared was ~$60. Even like that it's still a 3x for no reason.
There are lots of articles about individuals in the US who have died because they were rationing or otherwise couldn't afford insulin.[1][2] How can this be the case if first-generation insulins are cheap? Are they rationing second-generation insulin analogs instead of using the more affordable first-generation insulins? If so, why?
The first article says $1,300 per month for insulin. That almost certainly is a second generation insulin. Wal-Mart’s first generation insulin is $25/vial for the 2-3 vials a month a typical person needs: https://diatribe.org/paying-insulin
As to why people try to ration more expensive insulin is I suspect the “donut hole.” The young man in the first article aged out of his parent’s insurance, which was probably paying for his second-generation insulin. He probably had no idea what other options were available, or was concerned the first generation insulin was less safe.
A lot of people have limited executive functioning and our society isn’t good about helping them access the options available to them. A close family member of mine had a heart attack and was saddled with a $50,000 hospital bill. He had been eligible for Medicaid for years, but just never signed up.
You're treating social conventions like fundamental of human nature. Altruism, including kin selection is just as natural as greed. Kin can be socialised to tribe, tribe to national. There are numerous countries where this has been successfully done. Where the incentive structure is not narrow self interest at literally any cost. Greed as the only motivator is reductive and a narrative that can be used to justify literally any behaviour, no matter how exploitative. It's an easy out for bad actors and broken systems. Healthcare in other developed countries simply does not work like this.
My understanding is that the Nordic countries, which tend to be known for being much further up the socialism scale, have significant investment in research.
They’re not socialism for their exports! Novo Nordisk, one of the three insulin makers, is a Danish company. They’re as profitable as Eli Lilly. Guess where they make all their money?
> All the other details aside, this doesn't feel okay and I cannot believe that elected officials voted against legislation to prevent this sort of a markup situation. Whatever happened to them needing to represent the interests of the people?
Does it feel okay that the government does not fund R&D directly resulting in medicines in the public domain?
Seems like voters want low taxes, or voters are unable/unwilling to vote for politicians that would direct taxpayer resources to developing medicines, and hence private businesses have to fund the R&D.
In which case, once the hard part is done, the taxpayers now want to reap the rewards via price controls?
And if the argument is that taxpayers already fund R&D that the private companies use, then the problem is laws (or lack of enforcement) allowing private companies to patent discoveries made with taxpayer money, which seems like it would be blatantly illegal.
Not to mention that this tweet was posted on Thursday and the stock didn't bounce back quickly as it would once it was obvious it was a fake (and that would be almost instantly). Just a bunch of people with a confirmation bias who want to believe on Twitter, Reddit, and HN with little trading knowledge upvoting this stuff.
> Eli Lilly is down 5% because the market for their most profitable drug, a $125k/yr mAb IL-17 inhibitor, fell 5%. This is why Novartis, their major competitor with Cosentyx, is also down the same amount Not everything is about Twitter! [1]
> Notably, as well, Eli Lilly was ordered to pay $176.5 millipn to Teva in U.S. migraine drug patent trial on November 9th. [2]
I mean... I don't want to speculate about that particular incident, but generally, increasing parts of portfolio management seem to be done by algorithms. It seems plausible to me that the "verified" badge on twitter could be coded as some sort of trust anchor in some of those.
Something like "scan all tweets of the last day for names of our stocks + some keywords, but restrict the search to verified accounts only".
That kind of signal would be strongly affected by the current chaos.
I still remember about ten years ago when Twitter went public an entirely unrelated company named Tweeter went up 2000% because it traded under "TWTRQ". So yep I wouldn't put it past a few geniuses to sell based on a fake tweet.
Eli Lilly never even issued a press release to correct this "non-obvious fake". They later issued a correction via their real Twitter account.
I mean come on. The tweet said "We are excited to announce insulin is free now." Does that actually seem like corporate messaging? No product mention, no talk about how ethical they are?
If bots are scraping the twitter front end to grab the checkmark, and making irrational trades now by selling based on the news from parody accounts, humans would buy the dip. The price only stays down if all the rational actors agree the new price is fair, and not underpriced because of a bot mistake.
It's not what they think about this, it's what they think others will think about this. It doesn't matter whether it's true or not; it's just market confidence.
Any movement is another data point. Nobody wants to be the last one out.
The companion argument is that neither of those industry changes were unexpected, and thus if the market is behaving intelligently (so much that "of course they're not buying/selling based on tweets!" applies) then they wouldn't have moved the needle as they would be priced in. Smart market actors are surely more likely to immediately respond to surprise news (like an official-seeming tweet announcing insulin is free) than they are to respond to news that was well understood. The company market cap is >$300bn, a $150m fine is a cost of doing business.
I don’t think we can accept tweets now as a source of truth or hacker news submissions really. A personal blog post at least has a persons credibility behind it.
Before, you would not had blue tick on something that looks like major brand, known person etc. So yes, quite often you could know "this was said by this person".
The trolling (both for fun and for harm) on platform went off the charts last two weeks and there are multiple blue checkmarks accounts for a lot of companies/individuals.
Sure, to the extent you could trust any other piece of writing. Tweets come with the same caveats as any other source of information and require critical thinking to process.
Does something like that actually affect a company other than in the very short term? Won't the stock value just go back to where it was before, because nothing about the company and how it should be valued has actually changed?
I don’t understand what the checkmark on Twitter does.
I thought it was “identity confirmed” and when Elon started charging for it, it would basically allow anyone to confirm they are who they say they are.
Except it allows anybody to say they are anybody and Twitter will go “yep, we can confirm it’s true!”
Like, why the hell does getting the checkmark not update your name to match the credit card used for payment?
The meaning changed but the UI did not. Almost as if Elon did not understand the existing meaning before reinventing the blue check. His own Chesterton’s fence.
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[ 2.8 ms ] story [ 181 ms ] threadIt shows you how stupid and greedy people and algorithms can be. They take unvetted input and blindly run with it? Really? That existed long before Twitter. It's not Twitter's fault that stupid scales so easily.
When will The Media and Wall Street - and political leaders? - learn that Twitter is a source of info *that must be vetted*. Ignoring that fact, and letting your internal biases get the best of you is simply not an option *anywhere on the internet*.
Twitter is correlation, not causation.
The ONLY way to authenticate someone on twitter has been those check marks. And this week that all went to hell.
It is the same thing on tiktok they have verified accounts and I know that someone at tiktok verified this is X.
Up until this week those blue checks meant something and people who are not in the new cycle would not have known. I/We are in the news cycle because we are nerds/techies.
The whole market may have been heading down but this contributed.
And for the record, you don't just vet source, you vet the information itself. If it can't be confirmed and you act anyway...well that is by defintion child's play.
If children - *in adult bodies* - want to play in traffic on Twitter, it's not Tw's job to police them, or change their diapers when they shat their pants.
Who's wrong now??
But the blue check mark is really how most people (myself included) decide if a source is real on twitter. And that was destroyed this week by someone who apparently does not actually understand how twitter works.
So assuming a lot of people also trust that check mark and now what should be a good reliable source of information gave out something that is false. It was clearly part of it.
Was that the only reason the stock dropped? Probably not. The stock market is effectively random and only barely involved in reality.
I'll let the algos sort the mess of correlation or causation, truths and untruths, and just buy if they told me to.
> Eli Lilly’s insulin products sold $878 million in one quarter alone recently. Again lilly’s main insulin is at 43-60x price markup! It’s almost all profit!
> Lilly, Novo & Sanofi together supply 100% of all insulin in the US, and 90% of entire world!
All the other details aside, this doesn't feel okay and I cannot believe that elected officials voted against legislation to prevent this sort of a markup situation. Whatever happened to them needing to represent the interests of the people?
As a Canadian, where Americans often come here in droves to buy cheap insulin i've often wondered the same thing.
https://www.ctvnews.ca/health/caravan-of-americans-cross-int...
Americans drive 1,000 KM just to get affordable insulin which in many cases is a life or death drug?
edit: yes, seems it is indeed - https://news.ycombinator.com/item?id=33572721
However, it also mentions that some people need 50-60 units per meal and a vial contains 1000 units. Assuming three meals per day, someone using 50 vials per meal would spend $666.66 per month.
$666.66 per month would be prohibitively expensive for many people and even $50 to $75 could be a significant expense for people making minimum wage (depending on local minimum wage it could be equivalent to 7-8 hours of work before taxes).
https://4allfamily.com/blogs/diabetes/how-long-does-a-vial-o...
3 meals a day * 30 days would be 90 meals.
90 meals / 20 doses / 1 vial = 4.5 vials / month
4.5 * 25 = 112.5
I’m not seeing how we get to $666
Here's how I would do the math: 50 units per dose x 3.5 meals on average x 2 for basal = 350 units a day. Or 0.35 vial per day, and 10.7 vials per month. Assuming synthetic human insulin and not insulin analogue is used, that means about $270 per month.
However, some caveats:
- synthetic human insulin is not fast enough for most carbohydrates in meals, and it results in higher blood glucose spikes immediately after a meal than using an insulin analogue. The higher the blood glucose, the more insulin it takes to lower it the same amount. Moreover, we only have so many hours in the day, and slower acting synthetic human insulin needs time to work. So people using it are more likely to "overcompensate" and then eat a bit later to offset their dose. This is a very long-winded way of saying that a person might need slightly more synthetic human insulin than analogues, plus synthetic human insulin in general is less effective.
- In my calculations, I did not include correction bolus doses, insulin used to prime needles, and pump infusion sets (although probably very few people use human synthetic insulin in pumps anyways). I also did not include insulin that is spoiled in some way (refrigerator breakdowns, reserve insulin taken on trips that's not refrigerated, heatwaves, and so on).
- Most people use between 70 and 110 units of insulin per day, whether that's a combination of an insulin analogue and basal insulin injections, or using insulin analogue in a pump. I don't know how much synthetic human insulin is used per day on average, probably a bit more.
So I would say in practice, for someone who uses that much synthetic human insulin, the cost can be even $400 per month. For analogues, it would be much, much higher.
I think it makes sense for me to provide a source for all this - I care for someone with T1 diabetes and am somewhat connected with the broader T1 community.
The relatively inelastic demand of insulin analogues when synthetic human insulin is available shows how important analogues are to T1 diabetics.
Sometimes pharma companies try to allude to analogues being a luxury good compared to synthetic human insulin. But to T1 diabetics this notion is generally ridiculous. Analogue insulins allow them to regain a little bit more quality of life lost to the disease, and that should be a human right when insulin manufacturing costs are so low.
Are you saying that if these for-profit corporations didn't charge absurd amounts to US citizens, then the drug would be unattainable for Canadians?
US government also represents a huge proportion of the demand but is banned through corruption from exercising similar price pressure.
Even if there is a power imbalance between Eli Lilly and the Canadian Government, there would also be a power imbalance if it was instead Eli Lilly vs. individual consumers.
Despite the skyrocketing costs of insulin over the decades, Eli Lilly’s profits per unit are mostly in line with inflation. This is because in the US system, there is a pervasive system of rebates that exists between pharmaceutical companies and insurers. Insurers often may only pay 10% of what the sticker price is for insulin. But the way these rebates get negotiated through third party firms known as PBMs create a system that incentivizes insulin that is marked up an incredible amount and then discounted to X, than simply pricing it at X in the first place. But this obviously screws over anyone without access to the rebate, i.e. those without insurance. And this system largely exists because the privatized nature of insurance in the US. If there was some kind of universal medicare in the US, undermines those incentives and the market would normalize immediately.
You don't even need that. Just more/better regulation would suffice. You have countries with fully privatized healthcare systems like Switzerland or partially privatized ones like Germany or Netherlands which have no such problems.
Which is the cornerstone of any universal healthcare system? It only works in other countries if the healthy subsidize the costs of those less fortunate.
Also Switzerland had compulsory fully private insurance. To be fair they do suffer from similar issues as the US. Healthcare prices are very inflated compared to the surrounding countries, accessibility to some services (e.g. dental) is poor for low income individuals etc.
Of course it helps that Switzerland is a quite homogenous, has low inequality and subsidize access for low income individuals. However inherently the system is not that different from the one in US (I mean Switzerland is closer to US than either is to Britain).
The companies would rather prevent Canada from funding competition, so they just jack up prices in the US to compensate.
If the US passed a law requiring sales of drugs in the US to match the lowest sale price in any other country, one of 2 things would happen.
The likely thing is that innovation would come to a standstill. Money goes to where it can make the most money. No money in drugs? No new drugs.
Or, the companies would get a lot more hard nosed about sales in countries with price controls, and there would be trade wars between the US and those countries. And then you would see higher prices in Canada.
Citation?
> so they just jack up prices in the US to compensate.
Pharmaceutical companies charge as much as they can anywhere, including in the US. They wouldn't entertain reducing prices in the US even if the Canadian market were different.
I like the innovative drugs that are being made, so I'm not in favor of price controls.
If you think drugs are too expensive, then do something about it. Create some useful drugs and sell them for a cheaper price.
That's not true. It would be the case for (close to) perfectly competitive markets with lower margins, like petrol, basic foodstuffs to some extent etc. It does not apply to markets controlled by oligopolies/monopolies. Especially pharmaceuticals where margins are extremely high and producers of some drugs would still be able to make a profit if they cut (list) prices by a magnitude or two.
Only argument against is that it might decrease available funding for developing new drugs, which might be a legitimate concern. But in no way would reasonable prices controls result in a scarcity of almost all currently available drugs.
" When inventor Frederick Banting discovered insulin in 1923, he refused to put his name on the patent. He felt it was unethical for a doctor to profit from a discovery that would save lives. Banting’s co-inventors, James Collip and Charles Best, sold the insulin patent to the University of Toronto for a mere $1. They wanted everyone who needed their medication to be able to afford it.
"
There is no "IP in Canada for Insulin given UofT "owns" the patent.
Most of the price differences between US and Canada stems from the difference in patents and trademarks. Canada has far more "Generics" vs the US.
If Canada raised their insulin prices, do you think Eli Lily would lower their prices in the US?
There are pharmaceutical companies all around the world, while it's true that the US currently has the largest market cap for pharma companies, it's not like the rest of the world is sitting on it's hands. Of the top 15 largest pharmaceutical companies in the world, 8 are in the US, and 7 abroad. But market cap is a poor metric for impact, especially in the US, where it seems the market can price a social media company with no profit at 44billion, I'm not particularly convinced by valuations on pharmaceutical companies who's share pricing rely on price gouging and a indentured customer base to stay high.
Another perspective is that while they're able to sell insulin at 40x cost, something they developed decades ago, what's their incentive to develop new drugs? In countries where companies are required to provide licensing for generics after a certain time period, they would be incentivized to continue developing new drugs in order to keep products on the shelves that are in the exclusive licensing window.
Regardless of any of the above, what you're essentially advocating for is fleecing US citizens to the benefit of the rest of the world. I'm just not sure how this could possibly be a good thing for the US.
United healthcare, the largest US insurer cover over 40M people.
The US, out of its immense generosity is subsidizing canada?
News flash, Insulin was discovered here (canada).. so how exactly are you subsidizing a Canadian discovery?
How about this for a far more realistic explanation:
" When inventor Frederick Banting discovered insulin in 1923, he refused to put his name on the patent. He felt it was unethical for a doctor to profit from a discovery that would save lives. Banting’s co-inventors, James Collip and Charles Best, sold the insulin patent to the University of Toronto for a mere $1. They wanted everyone who needed their medication to be able to afford it.
"
https://www.vox.com/2019/4/3/18293950/why-is-insulin-so-expe...
Good god some of the comments you find here are just shocking.
The insulin that is incredibly expensive these days, that people drive to Canada for, is analogue insulin, which was developed in the last several decades by the pharmaceutical companies and is far more efficacious and easy to use. It’s a completely different product, which is often missed when these discussions of the donation of the original insulin patent is brought up.
If High US prices was subsidizing others, where does the massive profit come from?
This is why drugs in the US cost so much reformulations to extend patents: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4865781/
First Canada's drug administration confirms the drug is approved by the FDA and approves it for use in Canada without further test, trials, etc. Second as the production costs almost nothing any price the pharma company gets is almost pure profit. So the price in Canada ends up at $1 a tablet.
Now think what would've happened if US didn't exist. All the R&D, trials, etc. would have to be paid by all the other countries in the world. There would be far fewer new drugs being developed and they would cost a lot more.
Note that those markup figures are based on production cost, excluding capital investment. Lilly is profitable, but not any more profitable than Google or Facebook or Apple.
Making critical products less profitable than less critical ones is often contrary to “the interests of the people.” It drives investment from stuff like new pharmaceuticals to stuff like dating apps.
Insulin is actually a perfect example of that. The first generation insulins now are relatively cheap. The “insulin” we’re talking about here are second-generation insulin analogs, which are easier to administer and help better control blood sugar levels. We are at the tail end of the patents on those and we are already starting to see generic insulin analogs being made at Wal-Mart.
You have to think about the system in terms of how humans work and their motivations. Brilliant people who can make new, better insulin aren’t born any more altruistic than the people whose talents are better suited to coming up with new advertising algorithms. They want to make a bunch of money from their work. If you make it so that smart people can make more money doing an ad-tech startup rather than a bio-tech startup, that’s what they’ll do.
[0] https://www.google.com/search?q=humalog+price+chart+usa
The net price (what the manufacturer actually gets for Humalog) has dropped 16% since 2015. In 2019 the list price is $275 but the net price is $60.
https://1.bp.blogspot.com/-VfnPjfmmwUY/XzFtgfU87XI/AAAAAAAAq...
https://www.businessinsider.com/insulin-price-increased-last...
[1] https://www.npr.org/sections/health-shots/2018/09/01/6416158...
[2] https://nymag.com/intelligencer/2019/07/another-person-has-d...
As to why people try to ration more expensive insulin is I suspect the “donut hole.” The young man in the first article aged out of his parent’s insurance, which was probably paying for his second-generation insulin. He probably had no idea what other options were available, or was concerned the first generation insulin was less safe.
A lot of people have limited executive functioning and our society isn’t good about helping them access the options available to them. A close family member of mine had a heart attack and was saddled with a $50,000 hospital bill. He had been eligible for Medicaid for years, but just never signed up.
They are representing the interests of the people*.
* Rich people. You know, the ones who matter. It would be communist to listen to poor people, and they don't bribe well either!
Does it feel okay that the government does not fund R&D directly resulting in medicines in the public domain?
Seems like voters want low taxes, or voters are unable/unwilling to vote for politicians that would direct taxpayer resources to developing medicines, and hence private businesses have to fund the R&D.
In which case, once the hard part is done, the taxpayers now want to reap the rewards via price controls?
And if the argument is that taxpayers already fund R&D that the private companies use, then the problem is laws (or lack of enforcement) allowing private companies to patent discoveries made with taxpayer money, which seems like it would be blatantly illegal.
Most of the time it is either extremely exaggerated or outright false.
The "taking heads" always want to find some sort of causation/correlation and often it is just absolute garbage.
One day they may make a statement like : "Stocks tumble on Ukraine updates"
The very next day : "Stocks rally on Ukraine updates".
They just look for any "news" to try to show they understand the interconnected nature of news and markets. Often they are just grasping at straws.
Here's the thing.. If they could actually do what they say they are doing, hedge funds would be snapping them up and paying them far more.
When CPI went sky high few months back and the stock market still rallied the news was "S&P rallies while investors digest CPI information".
Like, what is this even supposed to mean?
https://twitter.com/janl/status/1591394005593497601
> Notably, as well, Eli Lilly was ordered to pay $176.5 millipn to Teva in U.S. migraine drug patent trial on November 9th. [2]
[1] https://twitter.com/quantian1/status/1591149510168039426
[2] https://twitter.com/unusual_whales/status/159115414597705318...
Not surprised at all. People think some portfolio manager see an obviously fake tweet and immediately unloads their position?
1) People make trades based on information, at least sometimes
2) People are tricked by false information, at least sometimes
Something like "scan all tweets of the last day for names of our stocks + some keywords, but restrict the search to verified accounts only".
That kind of signal would be strongly affected by the current chaos.
Eli Lily has market cap of $335B and 3M shares traded daily.
Content was super suspicious, sure. But even with that, if you assume others will believe that, you will react even of you yourself don't.
I mean come on. The tweet said "We are excited to announce insulin is free now." Does that actually seem like corporate messaging? No product mention, no talk about how ethical they are?
It was obviously fake.
It’s unlikely that the system has a quick mechanism to do this
But it didn’t happen which indicates manual traders agree with the drop in general, indicating it wasn’t caused by the tweet.
It's not what they think about this, it's what they think others will think about this. It doesn't matter whether it's true or not; it's just market confidence.
Any movement is another data point. Nobody wants to be the last one out.
The trolling (both for fun and for harm) on platform went off the charts last two weeks and there are multiple blue checkmarks accounts for a lot of companies/individuals.
I thought it was “identity confirmed” and when Elon started charging for it, it would basically allow anyone to confirm they are who they say they are.
Except it allows anybody to say they are anybody and Twitter will go “yep, we can confirm it’s true!”
Like, why the hell does getting the checkmark not update your name to match the credit card used for payment?