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Cancer drugs are the most profitable for Big Pharma
In 2018, cancer drugs earned the pharmaceutical industry $123.8 billion. Soon, they'll be worth billions more.
- A recent report from Evaluate shows oncological therapies were the most profitable in 2018.
- The report projects cancer drug sales to nearly double by 2024, pocketing a tidy $236.6 billion in profit.
- These projections come at a time when 42 percent of cancer patients lose their life savings to afford treatment.
The pharmaceutical industry's top earners are cancer drugs — a sentence that will be read to the surprise of no one. When sussing out why oncological therapies cost so much, the usual suspect is research and development (R&D). It takes years to develop a drug, deep pockets to fund that development, and then more time to take a drug through the FDA's laborious approval process.
A 2017 paper published in the Journal of the American Medical Association (JAMA) examined contemporary R&D costs for cancer drugs. The researchers analyzed the US Securities and Exchange Commission filings for 10 cancer drugs. They found the median time to develop a new drug was 7.3 years and the median cost to be $648 million.
That's an extraordinary risk. Surely pharmaceutical companies deserve the right to recoup those expenses and squirrel away some profit for future R&D. Right?
The answer is, obviously, yes. However, a recent report by consultancy Evaluate shows those profits to be in excess of a tidy sum.
Another day, another billion
In the infographic above, data journalist Katharina Buchholz shows Evaluate's data for worldwide sales of prescription and over-the-counter (OTC) drugs. As you can see, cancer drugs handily took the number one spot in 2018 and yielded the industry $123.8 billion worldwide. That results in a worldwide market share of 14.3 percent.
By 2024, Evaluate projects cancer drug sales to nearly double to $236.6 billion, increasing its worldwide market share to nearly 20 percent of prescription and OTC drugs. That makes oncological therapies worth more than the next five drug therapies combined.
The report forecasts the main drivers of this success to be Keytruda and Humira. Owned by Merck & Co. and AbbVie, respectively, the two cancer drugs are estimated to earn a combined $29 billion in 2024.
In total, the top 15 therapy areas will earn $1.2 trillion for the pharmaceutical industry in 2024.
Is R&D to blame?
A tray is prepared to administer an Yttrium-90 radioembolization procedure to a patient with liver cancer.
What about the argument that exorbitant R&D costs force pharmaceutical companies to charge such extravagant prices? As the JAMA study showed, the costs and time associated with drug development are certainly immense by quotidian standards. And Evaluate's data back up that research.
According to the report, the Swiss company Roche is the industry's top spender, investing $9.8 billion in R&D in 2018. The company is expected to spend another $9.9 billion in 2024, alongside competitor Johnson & Johnson. All told, the pharmaceutical industry's R&D investment will total $213 billion in 2024.
But that figure accounts for all R&D spending, not just cancer drugs. If Evaluate's projections are correct, the profits from cancer drugs alone would cover R&D expenses with $23.6 billion to spare. If we consider the industry's total projected 2024 profits, the surplus is $1,009 billion.
"[T]he industry's claims that high prices are vital to fund innovation are demonstrably false, according to economists who research how drug companies allocate money," cultural historian Lynn Stuart Parramore writes. "The truth is that many of these companies use profits reaped from their exorbitant prices to wheel and deal with Wall Street instead of developing new and more effective medicines."
Parramore further points out that the largest drug companies no longer develop drugs in house. As we've seen, Keytruda earns Merck billions, but the pharma powerhouse didn't foot its R&D bill. The drug was initially developed by Organon International before the Dutch company was acquired by Schering-Plough in 2007, which in turn merged with Merck in 2009.
A life for a life savings
True, there are other expenses to consider beyond R&D, including overhead, marketing, and, of course, battalions of patent lawyers. Tahir Amin, an attorney practicing in intellectual property law, also reminds us that many people in the pharmaceutical industry, especially scientists and researchers, remain driven to treat illnesses and improve lives.
But as he told Big Think in an interview, the business side prioritizes healthy stocks over healthy people:
And I think [much as been] lost in the process as pharmaceutical companies now really start to look at their bottom line and their shareholders and what the investors want rather than what their original purpose was — to help people become healthier. And I think that the bargain of that has tilted more towards the financialization of things rather than thinking about health first.
Making these inordinate gains a bitterer pill is that they come when patients are expunging their life savings to afford treatment. As reported by Big Think's Derek Beres, 42 percent of new cancer patients deplete their life savings during the first two years of treatment.
Of the 9.5 million cancer diagnoses analyzed in a study, the average costs came to $92,098. But that's just an average. In one case, the parents of a cancer-stricken girl spent $1,691,627.45 on her treatment. She died on her sixth birthday.
As Parramore concludes: "The status quo is unhealthy for anyone except pharmaceutical company executives. Drug companies need a new business model that gets them back into the business of making the drugs Americans need at prices we can all afford to pay."
As the world population continues to age and live longer, cancer rates will continue in tandem. Unless drastic changes occur, it looks as though Big Pharma has some salubrious years to look forward to.
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What is human dignity? Here's a primer, told through 200 years of great essays, lectures, and novels.
- Human dignity means that each of our lives have an unimpeachable value simply because we are human, and therefore we are deserving of a baseline level of respect.
- That baseline requires more than the absence of violence, discrimination, and authoritarianism. It means giving individuals the freedom to pursue their own happiness and purpose.
- We look at incredible writings from the last 200 years that illustrate the push for human dignity in regards to slavery, equality, communism, free speech and education.
The inherent worth of all human beings<p>Human dignity is the inherent worth of each individual human being. Recognizing human dignity means respecting human beings' special value—value that sets us apart from other animals; value that is intrinsic and cannot be lost.</p> <p>Liberalism—the broad political philosophy that organizes society around liberty, justice, and equality—is rooted in the idea of human dignity. Liberalism assumes each of our lives, plans, and preferences have some unimpeachable value, not because of any objective evaluation or contribution to a greater good, but simply because they belong to a human being. We are human, and therefore deserving of a baseline level of respect. </p> <p>Because so many of us take human dignity for granted—just a fact of our humanness—it's usually only when someone's dignity is ignored or violated that we feel compelled to talk about it. </p> <p>But human dignity means more than the absence of violence, discrimination, and authoritarianism. It means giving individuals the freedom to pursue their own happiness and purpose—a freedom that can be hampered by restrictive social institutions or the tyranny of the majority. The liberal ideal of the good society is not just peaceful but also pluralistic: It is a society in which we respect others' right to think and live differently than we do.</p>
From the 19th century to today<p>With <a href="https://books.google.com/ngrams/graph?year_start=1800&year_end=2019&content=human+dignity&corpus=26&smoothing=3&direct_url=t1%3B%2Chuman%20dignity%3B%2Cc0" target="_blank" rel="noopener noreferrer">Google Books Ngram Viewer</a>, we can chart mentions of human dignity from 1800-2019.</p><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDg0ODU0My9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTY1MTUwMzE4MX0.bu0D_0uQuyNLyJjfRESNhu7twkJ5nxu8pQtfa1w3hZs/img.png?width=980" id="7ef38" class="rm-shortcode" data-rm-shortcode-id="9974c7bef3812fcb36858f325889e3c6" data-rm-shortcode-name="rebelmouse-image" />
American novelist, writer, playwright, poet, essayist and civil rights activist James Baldwin at his home in Saint-Paul-de-Vence, southern France, on November 6, 1979.
Credit: Ralph Gatti/AFP via Getty Images
The future of dignity<p>Around the world, people are still working toward the full and equal recognition of human dignity. Every year, new speeches and writings help us understand what dignity is—not only what it looks like when dignity is violated but also what it looks like when dignity is honored. In his posthumous essay, Congressman Lewis wrote, "When historians pick up their pens to write the story of the 21st century, let them say that it was your generation who laid down the heavy burdens of hate at last and that peace finally triumphed over violence, aggression and war."</p> <p>The more we talk about human dignity, the better we understand it. And the sooner we can make progress toward a shared vision of peace, freedom, and mutual respect for all. </p>
With just a few strategical tweaks, the Nazis could have won one of World War II's most decisive battles.
- The Battle of Britain is widely recognized as one of the most significant battles that occurred during World War II. It marked the first major victory of the Allied forces and shifted the tide of the war.
- Historians, however, have long debated the deciding factor in the British victory and German defeat.
- A new mathematical model took into account numerous alternative tactics that the German's could have made and found that just two tweaks stood between them and victory over Britain.
Two strategic blunders<p>Now, historians and mathematicians from York St. John University have collaborated to produce <a href="http://www-users.york.ac.uk/~nm15/bootstrapBoB%20AAMS.docx" target="_blank">a statistical model (docx download)</a> capable of calculating what the likely outcomes of the Battle of Britain would have been had the circumstances been different. </p><p>Would the German war effort have fared better had they not bombed Britain at all? What if Hitler had begun his bombing campaign earlier, even by just a few weeks? What if they had focused their targets on RAF airfields for the entire course of the battle? Using a statistical technique called weighted bootstrapping, the researchers studied these and other alternatives.</p><p>"The weighted bootstrap technique allowed us to model alternative campaigns in which the Luftwaffe prolongs or contracts the different phases of the battle and varies its targets," said co-author Dr. Jaime Wood in a <a href="https://www.york.ac.uk/news-and-events/news/2020/research/mathematicians-battle-britain-what-if-scenarios/" target="_blank">statement</a>. Based on the different strategic decisions that the German forces could have made, the researchers' model enabled them to predict the likelihood that the events of a given day of fighting would or would not occur.</p><p>"The Luftwaffe would only have been able to make the necessary bases in France available to launch an air attack on Britain in June at the earliest, so our alternative campaign brings forward the air campaign by three weeks," continued Wood. "We tested the impact of this and the other counterfactuals by varying the probabilities with which we choose individual days."</p><p>Ultimately, two strategic tweaks shifted the odds significantly towards the Germans' favor. Had the German forces started their campaign earlier in the year and had they consistently targeted RAF airfields, an Allied victory would have been extremely unlikely.</p><p>Say the odds of a British victory in the real-world Battle of Britain stood at 50-50 (there's no real way of knowing what the actual odds are, so we'll just have to select an arbitrary figure). If this were the case, changing the start date of the campaign and focusing only on airfields would have reduced British chances at victory to just 10 percent. Even if a British victory stood at 98 percent, these changes would have cut them down to just 34 percent.</p>
A tool for understanding history<p>This technique, said co-author Niall Mackay, "demonstrates just how finely-balanced the outcomes of some of the biggest moments of history were. Even when we use the actual days' events of the battle, make a small change of timing or emphasis to the arrangement of those days and things might have turned out very differently."</p><p>The researchers also claimed that their technique could be applied to other uncertain historical events. "Weighted bootstrapping can provide a natural and intuitive tool for historians to investigate unrealized possibilities, informing historical controversies and debates," said Mackay.</p><p>Using this technique, researchers can evaluate other what-ifs and gain insight into how differently influential events could have turned out if only the slightest things had changed. For now, at least, we can all be thankful that Hitler underestimated Britain's grit.</p>
We’ve mapped a million previously undiscovered galaxies beyond the Milky Way. Take the virtual tour here.
See the most detailed survey of the southern sky ever carried out using radio waves.
Astronomers have mapped about a million previously undiscovered galaxies beyond the Milky Way, in the most detailed survey of the southern sky ever carried out using radio waves.
A new study shows our planet is much closer to the supermassive black hole at the galaxy's center than previously estimated.
Arrows on this map show position and velocity data for the 224 objects utilized to model the Milky Way Galaxy. The solid black lines point to the positions of the spiral arms of the Galaxy. Colors reflect groups of objects that are part of the same arm, while the background is a simulation image.
Apple sold its first iPod in 2001, and six years later it introduced the iPhone, which ushered in a new era of personal technology.