The US market has become increasingly important for Big Pharma, especially when it comes to new "blockbuster" products.
So, Insider views the news that GSK is making contingency plans for a possible change to how drugs are priced and sold in the US, the biggest market for medicines in the developed world, as significant, to say the least.
Needless to say, any changes wont involve prices going up! Poor US citizens already feel "gouged" and eye their Canadian and Mexican neighbours medicine prices with envy.
Americans fork over $60 billion extra paying U.S. prices instead of prices charged in Canada. That is greater than the gross national products of Kuwait, Iceland and Jamaica combined!
“My own feeling is that at some stage over the next few years there will be a change to the US pricing model,” Sir Christopher Gent said in an interview with The Times.
The GSK chairman would not speculate on how severe the overhaul might be, but confirmed that the drug developer was already considering its response: “We have to look at ways of mitigating (a change in pricing) in terms of its impact on the company’s ability to continue to do high intellectual property research and development.”
A recent meeting between Sir Christopher and Mark Mclellan, the former head of the US Food and Drugs Administration and the man now running the Medicare/Medicaid programmes to talk through the “complexity” of the issues seems to have been the stimulus for this contingency planning.
The Golden Age of Big Pharma ending with the cooking of its golden goose? Watch this space.
http://business.timesonline.co.uk/article/0,,9068-1800616,00.html
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