Canada <> US

:grinning:

It was put out n this thread by default as the bar for getting stories into the WTF News thread has gotten so high.

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:ctm:

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With big endowment comes the ability to partially offset political shenanigans.

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McGill is facing an existential crisis so no better excuse to dip into their endowment fund!

Closest American counterpart to McGill would be Harvard because of its high quality and long history. I continue to be disappointed that our federal politicians are afraid to speak out against this action by the Quebec government.

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Excerpt below from a WSJ article today. Not sure if Canada has any spare drugs to send south? Would prefer the US put more direct pressure on the drug companies to lower their prices to the US consumer.

Florida is the first state allowed to import prescription drugs from Canada where they often cost less.

The FDA’s decision could change the way Americans obtain these medications after decades of using retail and mail-order pharmacies. The Sunshine State’s plan will likely face drugmaker lawsuits and Canadian opposition. The FDA has also raised safety concerns about importing meds if it can’t vouch for their quality. Florida said it intends to import drugs for chronic health conditions such as asthma, diabetes, HIV/AIDS and mental illness for people with disabilities, prisoners and others cared for by state agencies. Later, the two-year program will expand to Medicaid recipients. Gov. Ron DeSantis estimated $150 million in savings the first year. Other states have filed similar requests with the FDA. Health Canada did not respond immediately to a request for comment.

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I started a separate thread for this:

There’s quite a few countries that I would trust the safety of their pharmaceuticals equal to or more than those vouched by the FDA, so hoping it will open up to other countries and bring the prices down.

Oof. I think McGill has a lot of actuarial students. Crazy to wipe out an entire province, not that they have a choice.

Isn’t the thing with Canadian pharmaceuticals all just smoke & mirrors? American pharmaceutical companies sell a drug to Canadians for $30 USD and they sell the same drug to Americans for $600. Obviously that’s bonkers. But a system whereby a portion of Americans get the drug for $30 and most are still paying $600 is equally bonkers.

Is the pharmaceutical company profiting at $30? Does $30 include the cost of R&D? What’s a fair price for both Canadians and Americans to pay?

Why not just regulate the pharmaceutical companies like the monopolies that they are and require regulatory approval for any drug that the company maintains at least an 80% market share on? (This would definitionally include every single drug under patent protection.)

I’m not sure 80% is the right number but I think it’s in the right ballpark.

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BTW, on AO I think I floated the idea of pricing based off relative per capita GDP. I don’t mind subsidizing antiretrovirals for Kenya but I do mind heavily subsidizing heart medication for first world countries.

This site lists Canada’s GDP per capita at $54,917.70 and USA’s at $76,329.60.

Canada’s GDP is ~72% of USA’s. So ideally whatever they charge in the US, Canada would pay 72% as much. Those numbers are constantly changing though, so add a buffer: price differential can’t be more than 10% off the GDP per capita differential.

If they charge $600 in the US, they can’t sell it to Canada for less than 600 * .72 * .9 = $388.80 USD.

Want to sell the drug in Canada for $30 USD? Great! You can’t charge anyone in the United States more than 30 / .72 / .9 = $46.30. And you probably shouldn’t even charge that much in case the GDP numbers change. You’d be ill-advised to charge more than 30 / .72 = $41.67.

Ok, I guess that means we’re subsidizing Canada a little bit, but only to the approximate extent that we’re richer than they are. Not 20-1 like some drugs currently are.

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Because then the pharmaceutical company will just license the drug (with profitable terms) to a “competitor” or two to ensure that market share is below that 80% threshold.

The 80% market share threshold also wouldn’t work since, at least while a drug is under patent protection, the manufacturer probably has 100% share for that specific drug. You could look at “80% share of drugs that do similar things”, which would (for example) group together Ozempic and Mounjaro…but writing a regulation that would do that effectively and without perpetual litigation would be either extremely difficult

Realistically, to do something about American drug prices, you really need to do something that resets the economics involved. For example, with my health insurance and given my/my family’s level of utilization, I have little practical incentive to attempt to buy my meds from a less-expensive country, or to ask my doctors to prescribe a less-expensive but adequately effective alternative. With my copays and stop-loss…doing either won’t immediately save me money.

Admittedly, they do play a role in why my health coverage is so expensive, but with my employer paying for much of it, and with those costs diluted by being part of a group, I don’t see the full effect of that in my payroll deductions. And, since it’s a payroll deduction…my share of my health insurance premiums doesn’t feel like it was real money to begin with, since at the end of the day I’m more concened with my take-home pay, and what I can put into my retirement accounts.

That could be changed…but the end result would be something that seems worse to enough people that politicians are unlikely to attempt that change.

The story that they give us is that we get cheaper prices due to negotiations on bulk pricing. I dunno how that works, like the provinces negotiate prices for the drugs? I dunno. that’s the story.

If there’s collusion and price-setting between “competitors” then I believe that we also have tools to deal with that, do we not?

Sure… since 100% is more than 80% then they would meet that trigger. I specifically said that it would definitionally include every drug under patent protection.

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We have the tools, but will we use them?

C.f. the games being played with generics or attempts to game the patent system.

Eh, to start with I’m ok with saying that Ozempic and Mounjaro are different drugs. If this needs to be revisited we could revisit, but let’s start off by assuming they’re different.

Ozempic enjoys patent protection until 2031 so it currently meets the 80% threshold and would be regulated as a monopoly. Mounjaro’s patent is up in 2026, so it too currently meets the monopoly threshold. If at some future date a generic version of those drugs were available and there was no evidence of price-fixing with the generic manufacturer then at that time the original manufacturer can ask to be removed from being treated as a monopoly.

Every new drug should be regulated as a monopoly unless the manufacturer chooses to eschew patent protection and immediately make the formula available to competitors and a competitor takes them up on it and actually competes with them.

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I wonder about that, however. They are similar enough in function that they ought to be seen as competing products, and that should in turn have a significant impact on their pricing.

Perhaps the industry being an oligopoly could be a factor here, and it’ll be interesting to see what happens to Ozempic’s pricing if/when Mounjaro really goes generic (assuming games don’t cause the generic price to be artificially inflated).

Regulation obviously could play a role in addressing how ridiculously expensive those meds are especially if they cost considerably less in the rest of the world (looks like Ozempic is roughly 67% cheaper in Canada than in the US?).

But the fact that drug prices in the US are so damned expensive even when competition should be keeping prices at least somewhat in check still points to me that the problem is more fundamental than deregulation.

If we are going to go down the regulation path, maybe an alternative would be: “insurers shall not pay / self-pay patients shall not be charged more for a drug than the average cost paid in other First World nations”.

Of course, even then that could be gamed. We might find Ozempic offered in the rest of the world, but Pzemoic made available in the US, which the manufacturer has great latitude to price because it’s not technically offered outside the US.

Then the regulated price approved may end up close to the current price.

Yes, I’d say so. Aren’t both drugs fairly expensive in the US currently?

The US is such an outlier in its drug prices that Canada now excludes them in the basket of comparable countries’ drug prices in our drug pricing mechanism. Canada has the third most expensive prices in the OECD but they are still a fraction of the US prices. In contrast, Canada’s prices are only 25% above the OECD median drug pricing.

As usual, Canada likes to compare itself to the US on healthcare metrics!

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A quick Google search indicates that there are around 40 million Canadians and around 30 million Americans on Medicare. If you consider a heart medication that’s only appropriate for adults over maybe 25 or 30, I’m guessing that the Medicare number exceeds that of Canada. Yet we aren’t able to negotiate the prices that Canada is.