Why Americans pay $1,000 for a $0.89 Drug

Why This $0.89 Cent Drug Sells for $1,000 dollars in the US.

So a study from March 2024 has gone viral. It estimates that the cost of making the patented diabetes drug, Ozempic, to be as low as 0.89 cents. At first I was mad too. But then I did my own research and found 3 buried secrets, that make the price seem fair.

Last one might piss you off though.

3. The Losers. It takes billions of dollars a year, over 10 to 15 years of clinical trials to make a new drug. And 90% still fail. So 1 winning drug, has to make up for 9 losers.

2. Insurance. This is mostly an American healthcare problem. In the UK the drug's less than $100 dollars and in Bangladesh it's less than $50 dollars.

1. It's still not that profitable. So for reference, the average return on invested capital is 30% with soft drinks. But pharmaceuticals get less than half that at 13%. That's

Sources: https://cdn.jamanetwork.com/ama/content_public/journal/jamanetworkopen/939327/zoi240154f3_1710960191.71155.png?Expires=1715488770&Signature=1FvqQZkWlnQuR1kF8dWnTX6MkYhse~qWtkXvdHXWkmQyxj56TTQQcUasaB~nt0oRhNTDmV0aD-R31e~hfa64FVTMKkPr1Ed72hThSQocBEEXFevYSR800v-hXDIsMPVTCEu1Pn6W~toxy5ojGrj5~PNNwew4FiI12bJiRBRzSg8BnD47-bkhPZlQsKgdxZBfUfYCMm40ACszws5BInJcOEBwtpxE-qbseZhyb3t-nSxip3pyF3-7mg16WtXKbAbRsW7f522f6-ZWhvJsbjQNkBOqxhz45194I5YvPlgihJhLQB4czIzLE22utDgahln01P3v8pKvLmnbtMuoTmSt4A__&Key-Pair-Id=APKAIE5G5CRDK6RD3PGA https://cdn.jamanetwork.com/ama/content_public/journal/jamanetworkopen/939327/zoi240154t1_1710960191.69655.png?Expires=1715488770&Signature=e3y2vg7Im7O5ACjYoOj16NUr8hiDD8wj-svsWUIO-eQaNOm0nBn7NdsA9Xh~gt2LJnqOg-B6DP48X2rOZYWXnUzpBySHd50sYwl6Af~0EJOQx0rsG831ph-lKTrIERXO8KdGG7Y8B~z8P6fdrRYxJh-p9-mAsYmYtgZbq0b0NtSF5R1FIXxSHYXQtZ~DYhBkvB0m5p0OYve1LXxzh6culRsc046iV73iGh0KtfzxhEI7aqR5w7e5o6z8O3~dhEgt-JjV6loMUsvR2X3UUZjUxYGE~3-op41btRIy-Eckni53DpsFLEAOPC1WASE34QMd88FJIhjrvDbbN1MR7JAbhQ__&Key-Pair-Id=APKAIE5G5CRDK6RD3PGA https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2816824 https://www.healthline.com/health-news/how-affordable-could-generic-ozempic-be-as-low-as-5-a-month-study-finds https://www.youtube.com/watch?v=EixhVBV2yzo https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/mgnroc.html https://nyscf.org/resources/90-of-drugs-fail-clinical-trials-how-can-stem-cells-improve-drug-discovery/ https://www.cancerresearchuk.org/about-cancer/find-a-clinical-trial/how-clinical-trials-are-planned-and-organised/how-long-it-takes-for-a-new-drug-to-go-through-clinical-trials#:~:text=There is no typical length,a drug to be licensed. https://www.youtube.com/shorts/-gkt-m9AIuI