- Jan 11, 2008
How We Got Here
The proportion of healthcare dollars expended on prescription pharmaceuticals in the United States has risen dramatically in recent years, and today, prescription drugs are a critical part of our healthcare and our lives. Demand for medicines is high because they genuinely contribute significantly to our health, our well-being, and the quality of our lives. But the improvements are so often overshadowed by how much money we have to spend to get those treatments. It’s especially bad for the elderly. Why do senior citizens have to spend nearly $2,000 per month, on average, on their medicines? Why should senior citizens have to travel to another country to save money when they buy their medicines?
The pharmaceutical industry has a stock answer to the cost question. Drug companies contend that research costs hundreds of millions of dollars that they have to recover. They note that they’re continuing to do the research that cures diseases and saves lives. And because they take all the financial risks associated with discovering new drugs, then they cannot lower drug prices without reducing the flow of new drugs. (One company’s current drug ads end with the phrase “today’s medicines finance tomorrow’s miracles.”)
Surely no one would argue against maintaining the stream of innovative new products that emerge from research. So, what’s the solution?
We have an answer. To understand why our solution makes sense, though, you need to understand how today’s medicines were discovered, approved, and introduced to the market. Why does this history matter? Because it’s crucial to see that although the process by which drugs make it to the market is undergoing a radical change, the ways in which their prices are ultimately determined remains mired in the old world.
An innovative approach is needed, a better way to make sure new and better drugs can continue to flow to consumers at a reasonable cost. Our solution makes sense when you grasp the nature of the changes. So, we’re going to look more closely at drug discovery and development, and explore the transformation of the pharmaceutical industry’s structure. Building on this examination, we offer a solution that will lower drug prices without interrupting the flow of new drugs. It’s a solution that fits this new world.