I've had a theory for a while that the way world drug companies make up for low profitability in those markets is in gouging in the US where it's a free-for-all and one should grab for as much as one can get.
The totality of US healthcare is a big, complicated $3+ trn/yr pie but there's flagrant abuse all over the system (and a variety of intl players, profitably for them, contribute) and pharmaceutical companies are eager to be in on the game.
I wonder what would happen to healthcare globally if the US were able to downsize its 20%-of-gdp system to something on the order of Western Europe or Japan which is to say 10% of gdp? That is, the revenue the system generates would drop by half.
Needless to say, there'd be resistance tantamount to, let's call it, institutional violence. US doctors' earnings cut in half? You've got to be kidding.
It's much simpler. They don't "make up" for anything, they just grab as much as they can get, everywhere. It just happens that in the US they can get more, and as the amoral, self-interested entities they are, they don't leave any money on the table.
No major company will say "Our profits are up in market A, so we should reduce profit in market B to compensate."
A lot of things that doctors do (because people want doctors and doctors want doctors to be in demand) could be done by nurses with special training.
That you think they are somehow related strongly undermines the rest of your post, as it suggests you are very weakly acquainted with the details of our healthcare system.
And in terms of drug prices in Western Europe, it really depends. One example, orphan drugs for rare diseases, the prices are actually pretty comparable to the US. These are the drugs that are several hundred thousand dollars per year.
A good example is Glybera, a gene therapy never approved in the US. The price in Germany was ~$1M USD.
Per an analysis of the report :
“The U.S. spent $10,637 per capita on health care in 2018. Comparable countries spent $5,527.
The overwhelming majority of the difference — 76% of it — came from spending on inpatient and outpatient care — not drugs, which get more attention but represent just 10% of the difference.“
As someone who works in the pharmaceutical industry, I’ll be the first to admit that the financial toxicity associated with prescription drugs is a very real concern. To be absolutely clear, there is opportunity to reduce the cost for many prescription drugs without hobbling innovation. But perhaps the conversation would be better served by focusing on the larger system that allow healthcare costs to flourish unchecked? Should we not also be outraged when a single hospital-provided band-aid costs $7.00 (~20X markup)?  Price gouging is rampant across the board.
This country doesn’t even pretend to have the right priorities.
"An internal slide presented to the company’s drug pricing advisory board showed that the increase would yield $24 million in new net sales."
What kind of company doesn't run revenue estimates for price increases? If you suggest a price increase, the first thing a CEO will ask is "how much extra revenue is that?"
"Teva only spent $689 million on Copaxone-related research since 1987 — just 2% of the roughly $34 billion it took in net revenue for the drug over the last two decades"
Usually drug sales today, pay for other R&D programs. What was Teva's total R&D spending across their entire portfolio over that time? My rough estimate is >$10B or >1/3 of what they made on Revlimid.
"Teva launched a new, more potent version of copaxone as part of what they dubbed a coordinated “generic defense strategy.” The strategy, according to internal powerpoints, included contracting with middlemen to block generics’ market access and aggressive campaigns to lobby both doctors and patients to stay on the more expensive version of the drug."
Teva created a new version of Copaxone that could be injected 3 times a week versus 7 times. Sure, incremental improvement, but it's really up to physicians to decide if it's right for their patients. Apparently they do. And "contracting with middlemen to block generics" is just shorthand for "we'll give you a discount so our product is more attractive than the generic". Isn't price competition good?
I'm not defending Teva's behavior here (yes, they have done shitty things), or the price of their drugs (yes, MS drugs are way too expensive). I'm just saying if you want to impose price controls on drugs, then just do it. Be upfront. Pass a bill that says "your drugs must be priced under $xx,xxx dollars".
This looks like a campaign to shit on a company for pretty typical company things, like forecasting out revenue from a price increase and selectively pulling statistics to paint a situation in the worst possible light that has no bearing on how things actually work.
Isn't price competition good?
What Teva basically did was drop the price enough to make the generic not that attractive in a cost basis.