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hepatitis pill prices

This is the pill that cures Hepatitis C

India: $900

America: $84,000

This is what happens when big pharma has bought all your politicians

Are these numbers accurate?

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    The conclusion fails to consider the economics of development. If the US price pays for the cost of R&D, then the product can be sold in e.g. India for little more than the cost of production. But if no one covers that R&D cost, nothing gets produced.
    – jamesqf
    May 3, 2016 at 5:34
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    @jamesqf There are other, more democratic ways to fund R&D, and production, for that matter. NASA, on one extreme, and the Linux kernel on the other.
    – Elliot Gorokhovsky
    May 3, 2016 at 5:36
  • I'd argue that, given the progressive nature of the US tax system, drug R&D is currently funded by something close to the NASA model, with small part of the population picking up most of the cost. The Linux kernel model, OTOH, is mainly driven by people who want to use it. So that would work IFF you have a lot of biochemists who have Hep C and want a cure.
    – jamesqf
    May 3, 2016 at 18:02

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The image is incorrect in its description, but on target for costs being different in the USA and India, but jumps to hyperbole for its reasoning.

The pill in question is Sovaldi, manufactured by Gilead Sciences as a Hepatitis C cure. The cost for the full course of treatment is $84,000 in the USA, and $900 in India. Thus the numbers quoted in the image are not per pill, but for the full course of treatment a patient would expect to undergo.

It is important to note that the pharmaceutical markets are wildly different in India and the USA. In the USA, it is legally mandated for people to carry some form of health insurance, and some insurances (not all) may cover some or all of the costs of the drug if they choose to include it. Thus the patient may never see the cost of the treatment themselves, only their intermediary in the form of a private insurance company or the state. In fact, for the drug in the question here, some states were able to negotiate the price down by 40%, and the cost presented to the consumer may be negligible depending on their plan. Europe has a similar system where governments negotiate the price, and a course of Sovaldi costs $55000 there. This marketplace of intermediaries and negotiation often leads to higher label prices in the USA and Europe, although the insured consumer may only pay a fraction of that.

In India, 80% of the population is without insurance, which means most consumers will need to pay for the treatment out of pocket, and thus a higher label price is not compatible to the marketplace for the company attempting to sell their product. India's Patent Act also contains verbiage that allows for licenses of drugs made by foreign companies to be revoked after three years in the marketplace, which keeps the price of foreign made drugs low in order to stave off the possibility of generic drug makers in India creating their own version of the drug three years after making it to market; while patents expire in the USA and Europe, such a quick revoking of a patent is atypical.

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    While insurance is a mitigating factor, many insurance plans in the US have a deductible of over $900, the total cost in India according to this. I don't think it's a given that out-of-pocket expenses will be lower without more specifics.
    – Is Begot
    May 3, 2016 at 2:47
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    @IsBegot I never made a claim that the out-of-pocket expenses would be lower than in India. If anything, a true examination would be average out-of-pocket expenses for the drug for a US resident as a percentage of median household income compared to $900 as a percentage for an Indian median income, and I simply could not find that data. My point was that the markets are not one-to-one comparisons beyond "politicians bribed" like the image attempts to make. US residents could very well pay more for the course of treatment.
    – Jimmy M.
    May 3, 2016 at 2:54
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    Boy, I love living in the UK...
    – Tim
    May 3, 2016 at 11:29
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    I think the original graphics is claiming that the 'wildly different pharmaceutical markets' are at least in part because the pharmaceutical companies have...let's say "extensive political influence" in the US.
    – DJClayworth
    May 3, 2016 at 14:17

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