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Thread: Cost of Drugs

  1. #1
    SG Enthusiast Far-N-Wide's Avatar
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    Cost of Drugs

    Forwarded by a friend.. long intresting read...

    MAKE SURE YOU READ TO THE END OF THIS...COSTCO SHOULD BE APPLAUDED FOR THIS........

    Let's hear it for Costco!! Make sure you read all the way past the list of the drugs. Note the title on the below email signature block.

    Did you ever wonder how much it costs a drug company for the active ingredient in prescription medications? Some people think it must cost a lot, since many drugs sell for more than $2.00 per tablet. We did a search of offshore chemical synthesizers that supply the active ingredients found in drugs approved by the FDA. As we have revealed in past issues of Life Extension, a significant percentage of drugs sold in the United States contain active ingredients made in other countries. In our independent investigation of how much profit drug companies really make, we obtained the actual price of active ingredients used in some of the most popular drugs sold in America.

    The data below speaks for itself.

    Celebrex: 100 mg
    Consumer price (100 tablets): $130.27
    Cost of general active ingredients: $ 0.60
    Percent markup: 21,712%

    Claritin: 10 mg
    Consumer Price (100 tablets): $215.17
    Cost of general active ingredients: $0.71
    Percent markup: 30,306%

    Keflex: 250 mg
    Consumer Price (100 tablets): $157.39
    Cost of general active ingredients: $1.88
    Percent markup: 8,372%

    Lipitor: 20 mg
    Consumer Price (100 tablets): $272.37
    Cost of general active ingredients: $5.80
    Percent markup: 4,696%

    Norvasc: 10 mg
    CONSUMER price (100 tablets): $188.29
    Cost of general active ingredients: $0.14
    Percent markup: 134,493%

    Paxil: 20 mg
    Consumer price (100 tablets): $220.27
    Cost of general active ingredients: $7.60
    Percent markup: 2,898%

    Prevacid: 30 mg
    Consumer price (100 tablets): $44.77
    Cost of general active ingredients: $1.01
    Percent markup: 34,136%

    Prilosec: 20 mg
    Consumer pric! e (100 t ablets): $360.97
    Cost of general active ingredients: $0.52
    Percent markup: 69,417%

    Prozac: 20 mg
    Consumer price (100 tablets): $247.47
    Cost of general active ingredients: $0.11
    Percent markup: 224,973%

    Tenormin: 50 mg
    Consumer price (100 tablets): $104.47
    Cost of general active ingredients: $0.13
    Percent markup: 80,362%

    Vasotec: 10 mg
    Consumer price (100 tablets): $102.37
    Cost of general active ingredients: $0.20
    Percent markup: 51,185%

    Xanax: 1 mg !
    Cons umer price (100 tablets): $136.79
    Cost of general active ingredients: $0.024
    Percent markup: 569,958%

    Zestril: 20 mg
    Consumer price (100 tablets): $89.89
    Cost of general active ingredients: $3.20
    Percent markup: 2,809

    Zithromax: 600 mg
    Consumer price (100 tablets): $1,482.19
    Cost of general active ingredients: $18.78
    Percent markup: 7,892%

    Zocor: 40 mg
    Consumer price (100 tablets): $350.27
    Cost of general active ingredients: $8.63
    Percent markup: 4,059%

    Zoloft: 50 mg
    Consumer price: $206.87
    Cost of general active ingredients: $1.75
    Percent markup: 11,821%

    Since the cost of prescription drugs is so outrageous, I thought everyone should know about this. Please read the following and pass it on.

    It pays to shop around. This helps to solve the mystery as to why they can afford to put a Walgreen's on every corner. On Monday night, Steve Wilson, an investigative reporter for Channel 7 News in Detroit, did a story on generic drug price gouging by pharmacies. He found in his investigation, that some of these generic drugs were marked up as much as 3,000% or more. Yes, that's not a typo. three thousand percent! So often, we blame the drug companies for the high cost of drugs, and usually rightfully so. But in this case, the fault clearly lies with the pharmacies themselves.

    For example, if you had to buy a prescription drug, and bought the name brand, you might pay $100 for 100 pills. The pharmacist might tell you that if you get the generic equivalent, they would only cost $80, making you think you are "saving" $20. What the pharmacist is not telling you is that those 100 generic pills may have only cost him $10!

    At the end of the report, one of the anchors asked Mr. Wilson whether or not there were any pharmacies that did not adhere to this practice, and he said that Costco consistently charged little over their cost for the generic drugs.

    I went to the Costco site, where you can look up any drug, and get its online price. It says that the in-store prices are consistent with the online prices. I was appalled. Just to give you one example from my own experience, I had to use the drug, Compazine, which helps prevent nausea in chemo patients.

    I used the generic equivalent, which cost $54.99 for 60 pills at CVS. I checked the price at Costco, and I could have bought 100 pills for $19.89. For 145 of my pain pills, I paid $72.57. I could have got 150 at Costco for $28.08.

    I would like to mention, that although Costco is a membership" type store, you do NOT have to be a member to buy prescriptions there, as it is a federally regulated substance. You just tell them at the door that you wish to use the pharmacy, and they will let you in (this is true).
    USAF RETIRED

  2. #2
    Moderator John's Avatar
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    "Cost of general active ingredients" is hardly the full extent of the COGS.

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    Assistant Admin Ken's Avatar
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    Yes, the research is why they are so expensive... I won't get into overhead and all of the other type of costs.

  4. #4
    Second Most EVIL YARDofSTUF's Avatar
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    All generics arent the same either, the really cheap ones may not be as good of quality as the higher priced generics.

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  6. #6
    Elite Member TonyT's Avatar
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    All the blurbs about 'cost of research". "cost of marketing", "other ingredients", is just a bunch of hype originated by the drug manufacturers (pharma corps). The profits are outrageous and they gouge us intentionally because in most cases, you cannot live without the necesary drug at the time. (includes the rare cases of drugs that actually cure something, such as antibiotics)

    The majority of research costs are OUR tax dollars via govt grants to universities and via "special FDA projects". One of the best kept secrets today is just how much money the drug corps actualy spend on research & development (their own money). Most of the pharma corps expenses are marketing costs and lobbiests expenses.

    Another real problem as a result of this mess is insurance companies invest in pharma stock, as do banks and other money market investments. The result: those that control the money don't want to see profits reduced and we all end up bearing the burden.
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  7. #7
    Second Most EVIL YARDofSTUF's Avatar
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    TonyT, also dont forget that these drugs get sold to warehosues, then on to pharmacies/hospitals.

    The biggest hikes seem to be at the pharmacies on average, but that isnt the cvase for each drug.

    While they are hiked up, it does cost the companies more than the cost of ingredients to put it together, plus then the pharmacies buy pill bottes and have people putting it into portions.

    But ya the prices could still make companies money at 50% less.

  8. #8
    R.I.P. 2013-11-22 blebs's Avatar
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    Quote Originally Posted by YARDofSTUF View Post
    All generics arent the same either, the really cheap ones may not be as good of quality as the higher priced generics.
    They all have to meet FDA guidelines.

    Health professionals and consumers can be assured that FDA approved generic drugs have met the same rigid standards as the innovator drug. To gain FDA approval, a generic drug must:
    contain the same active ingredients as the innovator drug(inactive ingredients may vary)
    be identical in strength, dosage form, and route of administration
    have the same use indications
    be bioequivalent
    meet the same batch requirements for identity, strength, purity, and quality
    be manufactured under the same strict standards of FDA's good manufacturing practice regulations required for innovator products

    http://www.fda.gov/cder/ogd/
    Last edited by blebs; 07-25-07 at 03:46 PM.
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  9. #9
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    Here's another set of numbers, right off my Medicare Part D statement:

    Hydrochlorothiazide $3.73. The margin, by law is 17%, or 60 cents. For that the pharmacy has to provide a label, a bottle, count the pills, report the transaction to the Part D provider, and pay the credit card fee.

    Another prescription - Ciprofloxacin, $7.35. Margin is $1.25

    For the month, four prescriptions, $261, or $44.37 gross margin.

    For sure, the pharmacies aren't getting rich. That's why you are lucky if your pharmacist paid attention in his English as a Second Language class.

  10. #10
    Second Most EVIL YARDofSTUF's Avatar
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    Quote Originally Posted by blebs99 View Post
    They all have to meet FDA guidelines.
    Generics have more leway(sp)

  11. #11
    SG Enthusiast Kyle's Avatar
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    Quote Originally Posted by John View Post
    "Cost of general active ingredients" is hardly the full extent of the COGS.
    Very misleading email.

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    TypicalWhitePerson JC's Avatar
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    Quote Originally Posted by YARDofSTUF View Post
    Generics have more leway(sp)
    really???
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    Elite Member TonyT's Avatar
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    Just to add that my statements above don't appply to all drugs, just most of them. For example, some medications have to be sterile, as for injections and such, and these cost a lot more to manufacture.
    No one has any right to force data on you
    and command you to believe it or else.
    If it is not true for you, it isn't true.

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  14. #14
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    Quote Originally Posted by YARDofSTUF View Post
    Generics have more leway(sp)
    Either way, give me the $4 wal-mart generics any day.

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    propaganda

    the most profitable branch.
    but only 1 active substance from initial 15,000 items
    reach the market
    usually after 16y pre-market research
    from 25y period covered by patent

    FYI all 1, 2, 3 lab stages only to spent the money (16y !)
    after lunch there are less then 10y without generics
    but only a few are the most profitable stars (marketing)

    BTW all generics have only very limited documentation
    and cannot be registred without principal item on the market.

  16. #16
    Second Most EVIL YARDofSTUF's Avatar
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    Quote Originally Posted by blebs99 View Post
    They all have to meet FDA guidelines.

    Health professionals and consumers can be assured that FDA approved generic drugs have met the same rigid standards as the innovator drug. To gain FDA approval, a generic drug must:
    contain the same active ingredients as the innovator drug(inactive ingredients may vary)
    be identical in strength, dosage form, and route of administration
    have the same use indications
    be bioequivalent
    meet the same batch requirements for identity, strength, purity, and quality
    be manufactured under the same strict standards of FDA's good manufacturing practice regulations required for innovator products

    http://www.fda.gov/cder/ogd/
    Our SG chem geek explained this before the non active ingridients are the difference and can affect the drug.

  17. #17
    Forum Techie A_old's Avatar
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    Quote Originally Posted by TonyT View Post
    All the blurbs about 'cost of research". "cost of marketing", "other ingredients", is just a bunch of hype originated by the drug manufacturers (pharma corps)..
    Yea maybe they're overpriced, but the cost of research isn't BS. My wife is a Ph.D student and paying a lab full of 10-20 people, 20k each (this is at a school, try at an organization at 50k+ each and hundreds of people instead), paying for the uber expensive equipment and its maintenance, etc. is not cheap. Research is VERY expensive.

  18. #18
    Elite Member TonyT's Avatar
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    Quote Originally Posted by Amro View Post
    Yea maybe they're overpriced, but the cost of research isn't BS. My wife is a Ph.D student and paying a lab full of 10-20 people, 20k each (this is at a school, try at an organization at 50k+ each and hundreds of people instead), paying for the uber expensive equipment and its maintenance, etc. is not cheap. Research is VERY expensive.
    Agreed, it is not cheap, but the majority of is is paid for by OUR tax dollars, to the tune of 4+ billion/year!
    No one has any right to force data on you
    and command you to believe it or else.
    If it is not true for you, it isn't true.

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  19. #19
    Moderator David's Avatar
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    Quote Originally Posted by YARDofSTUF View Post
    Our SG chem geek explained this before the non active ingridients are the difference and can affect the drug.
    Non-active ingredients are somewhat of a misnomer since they are adjuncts to the primary chemical.

  20. #20
    Forum Techie A_old's Avatar
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    Quote Originally Posted by TonyT View Post
    Agreed, it is not cheap, but the majority of is is paid for by OUR tax dollars, to the tune of 4+ billion/year!
    That's true, but so are things like 500k for random ass society of crap that no one cares about meetings and blah blah blah for all kinds of private organizations. Although 4B is crap ton of money, I'd rather it went into that to get rid of disease than to random groups. I'm sure pharmaceutical brunt a large portion of the research bill as well, right? I mean it can't possibly be that we foot all of the research and they reap the profits..?

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