Is insulin free? The $8 oolong case on Twitter "knocked out" Lilly's 20 billion market value, and also poked out the proposition of the century in the pharmaceutical industry...

Unlike the situation where domestic insulin has undergone a sharp price reduction in special centralized procurement, in the United States, the price of insulin has been under fire, and the US government has also been arguing over insulin pricing for many years
.

Related insulin giants Eli Lilly, Sanofi and Novo Nordisk were once at the center of the lawsuit due to the rise in insulin prices
.
After combing, the content of multiple lawsuits pointed to a common point, in the past 10 years, the production cost of insulin and other products has obviously decreased, but pharmaceutical companies have still increased the price of diabetes drugs, but the drug itself has hardly "grown"
except for the price.

"We will take on
the greed of the pharmaceutical industry.
" This also makes diabetics complain
.
Some netizens also lamented that this is the void cost generated by the continuous matryoshka between hospitals, pharmaceutical companies and insurance companies after the privatization of medical care, all of which are passed on to the people
.

After years of controversy, the U.
S.
Congress issued a "shot" in June 2022, unveiling a bill
that has attracted much attention from the outside world.
Under the bill, Medicare beneficiaries and private insurance plan beneficiaries would have no more than $35 per month in insulin prescription drug
deductibles.
The bill would require at least 60 senators to vote for it in the Senate, though some Republicans argue that deductible limits would only place too much burden on Medicare and would not help attract drug companies to expand production
.

Although pharmaceutical companies have been criticized for obtaining huge profits by relying on patent monopolies, in order to attract pharmaceutical companies to expand production or continue to innovate, "rate of return" has always been a major driving force for pharmaceutical companies to move forward, and the price formation mechanism of innovative drugs will directly affect the market expectations
of enterprises.

Previously, Bi Jingquan, deputy director of the Economic Committee of the National Committee of the Chinese People's Political Consultative Conference and executive vice chairman of the China Center for International Economic Exchanges, publicly stated that the research and development of new drugs is a high-risk undertaking, how much new drugs can be sold after they are launched, whether the sales revenue can cover the cost of research and development, whether there can be profits to invest in new research and development, and the role of market mechanism should be played by enterprises to make independent decisions, bear their own risks, and bear their own profits and losses
.
For high-priced innovative drugs, medical insurance determines the payment standard
according to the financial situation.

However, why are US drug prices so expensive? Why has the "US version of medical insurance negotiations" been unresolved? Where is the reasonable space for pharmaceutical companies' profits? How to promote the better development of the industry by balancing commercial value and public welfare? In general, different policies between countries, the relationship between pharmaceutical companies and the government, and differences in medical insurance systems will affect the "pricing"
of drugs.

Many industry insiders previously said in interviews with E drug managers that "lowering drug prices" is not a new topic, but it is difficult
to implement.
Unlike China, Big Pharma has the ability to negotiate and balance with the FDA and government teams, so drug prices are unlikely to be lowered
.

The above people believe that the US drug price can not be cut is not unrelated to the lobbying of big pharma, on the other hand, drugs account for only 10% of the overall cost of medical care in the United States, in recent years the US economy has become tense, once this knife cut down, but in fact may damage the vitality of the entire market
.

The head of BD of a Chinese innovative pharmaceutical company in the United States told E drug managers that due to different policies, the pricing power of drugs in the US market is largely in the hands
of enterprises.
"Because the United States as a whole still wants to support innovation, if it is constrained in price, it may discourage enterprises to innovate
.
" I don't think it's very likely to go through such drug price negotiations
.
”

In addition, she also said that the coverage mechanism of the medical insurance system in China and the United States is different
.
China is basically paid by the state, but the United States is more about the coexistence
of commercial insurance and national medical insurance.
At present, the United States can only control the group over 65 years old or low-income people in terms of health insurance, because the health insurance of these people is paid for by the government
.
The United States has always wanted to control drug prices, but because the US market has a complex price system for drugs, there has been no good way
to deal with it.
Another R&D director of a multinational pharmaceutical company also holds a similar view
.

The problem that insulin in the United States is facing is also the balance
between the interests and the public good that all drugs need to address.

02 Behind the sunk cost, where is the balance between commercial value and social value?