Why does Humira cost less in Europe?

FREQUENTLY SPEAK POLICIES to do something to cope with the high cost of pharmaceuticals. President Trump promised to lower the price of drugs "really, really, really." On October 15, the administration announced a "historic proposal" to achieve Trump's goal. A new rule would require manufacturers to disclose drug prices in all TV commercials they use to advertise their products. The proposal has been widely recognized as superficial and unlikely to have a real impact on the cost of drugs.

Perhaps this is why Trump made another speech on Thursday in which he made a different proposal and spoke of "a revolutionary change". This one is supposed to go beyond the "global burden" which he claimed to be considerably higher than elsewhere. The proposed policy will generate pre-election titles. If it is implemented, which is uncertain, it will be a pilot program benefiting a fraction of Medicare beneficiaries from 2020 to 2025.

Despite Trump's inflammatory and inaccurate statements about self-service, we can learn from other countries how to control drug prices. At the end of September, the European Commission approved a fifth biosimilar drug to compete with Humira, one of the world's most expensive and best-selling medicines. As of this month, Humira, which deals with rheumatoid arthritis and other similar conditions, will have many competitors in the EU countries.

It is expected that competitors will significantly reduce the costs of the drug in Europe, even though Humira is already much cheaper than in the United States. Earlier this year, the New York Times reported that a typical package of two syringes costs $ 2,669 in the United States, compared to $ 1,362 in Britain and even less elsewhere in Europe. The current drop in prices is due to the more efficient purchasing power of European payers. These price disparities are about to get worse as a result of increased competition.

The European Commission has allowed competitors to enter the market due to the expiry of the European patents of the manufacturer Humira, AbbVie, Illinois. Something similar could have been expected in this country because AbbVie's main patent on Humira has already expired. In fact, as I reported in the Commonwealth last year, the Food and Drug Administration approved a biosimilar proposed by Amgen. But this competitive drug is not yet available for purchase in the United States and will not be available until 2023 because AbbVie has created what is known as a "patent puck" around Humira in the United States.

The development of a patent pit is an attempt by a company to extend its original patent protection by seeking new patents for small product modifications. Pharmaceutical companies base their claims on modifications such as turning a pill into a capsule or producing a dosage once a day instead of a twice daily version. AbbVie has filed more than 100 US patents on Humira, creating the basis for extended legal disputes, even though the underlying drug has not changed. This complex litigation strategy effectively delayed the introduction of Amgen's competitor as well as biosimilars produced by other manufacturers.

Europe also has strong patent laws, but the European Commission, after investigating the issue, has issued rules prohibiting drug companies from abusing them "to extend market exclusivity and other anti-competitive high prices "In the US, that's why Humira users in the United States will continue to pay significantly higher prices than European patients for years to come.

The exploitation of patients and patents provides a tremendous benefit to AbbVie's shareholders and executives. The CEO made $ 22.6 million in 2017. The company's latest filing with the SEC shows a three-month turnover of $ 8.27 billion, of which $ 5.18 billion came solely from Humira. After all manufacturing, research, administration and tax expenses, the company announced adjusted net income of $ 3.16 billion for the quarter, a profit margin of 39%. Since about a third of Humira is sold at lower prices overseas, domestic sales generate even higher profit margins. This means that nearly 50 cents of every dollar spent on Humira in this country is falling in AbbVie's bottom line.

Although health care systems in Western Europe vary considerably from one country to another, they are consistently referred to as "socialized medicine" in political debates. Some of these countries are more socialized than others, but they have in common that virtually everyone is covered, the results are good and the costs are significantly lower than ours. The large and sustained price gap between the United States and the European Union for a drug as important as Humira is another example of how our health system serves the interests of companies more than those of the US. patients. We do not need to "socialize" our health care, but we need to learn from Europe how to better balance business priorities with access to care.

Edward M. Murphy worked for the state government from 1979 to 1995. He was commissioner of the youth services department, department of mental health and executive director of the Health and Educational Facilities Authority. He recently retired as CEO and President of one of the country's largest disability service providers.

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