Why is Lucentis/Ranibizumab 40x more expensive than Avastin/Bevacizumab?

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#1

The two drugs for wet age-related macular degeneration (among other things), with similar effectiveness for that purpose, cost a similar amount to produce and are made by the same company. Articles linked here don’t point to patents being a differentiator. Not quite explicitly stated, the reason seems to be market segmentation/price discrimination (across treatment for wet AMD and other diseases) to maximize profits for Roche. Is that the reason? Why ask/point out?

First, another question: are patents a major reason why Roche/Genentech controls both drugs, and thus is able to segment market as opposed to facing price competition in both markets?

Second An effective eye drug is available for $50. But many doctors choose a $2,000 alternative. (2013-12-07):

Doctors, meanwhile, may benefit when they choose the more expensive drug. Under Medicare repayment rules for drugs given by physicians, they are reimbursed for the average price of the drug plus 6 percent. That means a drug with a higher price may be easier to sell to doctors than a cheaper one. In addition, Genentech offers rebates to doctors who use large volumes of the more expensive drug.

This is of course an endemic bias in the system in favor of monopoly drugs, but somehow the control by one company of multiple otherwise competing drugs puts this in a starker light. This also highlights the incredible potential power of procurement as a mechanism for reform.

But the flow of cash also pushes up the health-care costs that are projected to deplete federal budgets. For while Genentech has aggressively marketed the more expensive drug and sought to restrict the use of the cheaper one, critics say, Medicare has been powerless to do anything but pay up.

That’s because over the past seven years, despite pleas from the Food and Drug Administration and doctors groups, Genentech has maintained the barriers that make it harder for doctors to use the cheaper drug.

Avastin was not originally intended for use in the eye, and the company has refused encouragement from the FDA to seek official approval for using it to treat eye ailments, according to unpublished internal FDA documents. This forces doctors to use it “off-label,” or in ways not specified on the medicine’s label.

The company also packages the drug, which was approved for cancer in 2004, in doses far too big for use in ophthalmology, meaning that the drugs must be repackaged by other companies for use in the eye, raising the risk of contamination.

Suggestive of how captured the regulatory approval process is, and that reform of that process could be powerful.

Cheap blindness drug should be made widely available, says WHO (2015-05-17):

The WHO’s essential medicines committee has rejected an application from Novartis to have the expensive licensed drug Lucentis added to the list of drugs all countries should stock (PDF). The decision is a blow for the pharmaceutical companies that have been fighting the growing use of Avastin for age-related wet macular degeneration. Avastin, primarily a bowel cancer drug, is similar to Lucentis but 40 times cheaper when split into the tiny doses to be injected in the eye.

Good for WHO! (Joke: Good for Who? Everyone. Everyone but Roche, and as of yet, everyone in jurisdictions with regulators and doctors corrupted by Roche.) This committee and list points to another essential (ahem) mechanism for reform.

I mention reform mechanisms above; toward what? Cheaper and thus more accessible treatment. However, and important side effect is shrinking the profits of proprietary drug companies, thus shrinking their power and constituency. Note the difference from usual copyright/culture policy reform, which tends to seek carve outs that have some impact on proprietary control of certain activities, but minimal impact on profits and thus power. If commons-based production were seen as potent, the reform mechanisms above could be further tweaked to favor commons-based production, even for drugs (subject for further later exploration).

English Wikipeida links for the two drugs:



#2

There are 115 and 1142 comments on the 2013 article at Hacker News and reddit respectively.


"no-one owns the patent for spinach, so the FDA can't find a target to force to pay for the studies"