Drugs that cost money and save money
Big Pharma has become a familiar whipping boy in the debate over healthcare costs. CAR-T therapies to treat certain cancers, for example, can cost between half a million and a million dollars for a single treatment course. What’s the prospect of a cancer cure worth to you?
GLP-1 receptor agonists like semaglutide (Ozempic, Wegovy) and tirzepatide (Mounjaro, Zepbound) are transforming the lives of obese patients. For most people, these drugs will have to be taken continuously for the rest of their lives at a cost of ca. $16,000/year. Given the number of obese Americans, this represents a huge burden for insurers, both private and Medicare.
But thinking about the benefits simply from the standpoint of obesity treatment elides the economic benefits of weight reduction: fewer surgeries, discontinuing drugs to treat other obesity-related conditions, etc.:
“One of the most striking shifts has been in the area of bariatric surgery, where once-steady demand for weight-loss procedures has declined significantly (by as much as 30% at some facilities) as more patients turn to these potent medications to shed pounds. This change is so pronounced that some bariatric surgery programs have closed.”
*snip*
“Semaglutide, tirzepatide, and other GLP-1 agonists do not only help people lose weight. Patients who take these drugs have experienced significant improvements in diabetes, blood pressure, and cardiac risks. These improvements are critical because they can reduce the need for additional pharmaceutical interventions and, in some cases, prevent hospitalizations altogether.
“The full potential has yet to be quantified, but even though GLP-1 agonists come with big price tags (perhaps too big), they could save the country billions each year in healthcare costs.
“For example, weight loss achieved through semaglutide can lead to a reduction in hypertension, which in turn may decrease the need for antihypertensive medications. Improved cardiac function could mean fewer interventions for heart-related issues, and better-managed diabetes can reduce the risk of complications such as neuropathy, retinopathy, and kidney disease, all of which can lead to hospitalizations and other costly interventions.”
While many drugs are overpriced, both in terms of production costs and in terms of recouping investment costs, any discussion of drug costs should acknowledge the positive externalities of pharmaceuticals.
Drug pricing and benefits
GLP-1 receptor agonists like semaglutide (Ozempic, Wegovy) and tirzepatide (Mounjaro, Zepbound) are transforming the lives of obese patients. For most people, these drugs will have to be taken continuously for the rest of their lives at a cost of ca. $16,000/year. Given the number of obese Americans, this represents a huge burden for insurers, both private and Medicare.
But thinking about the benefits simply from the standpoint of obesity treatment elides the economic benefits of weight reduction: fewer surgeries, discontinuing drugs to treat other obesity-related conditions, etc.:
“One of the most striking shifts has been in the area of bariatric surgery, where once-steady demand for weight-loss procedures has declined significantly (by as much as 30% at some facilities) as more patients turn to these potent medications to shed pounds. This change is so pronounced that some bariatric surgery programs have closed.”
*snip*
“Semaglutide, tirzepatide, and other GLP-1 agonists do not only help people lose weight. Patients who take these drugs have experienced significant improvements in diabetes, blood pressure, and cardiac risks. These improvements are critical because they can reduce the need for additional pharmaceutical interventions and, in some cases, prevent hospitalizations altogether.
“The full potential has yet to be quantified, but even though GLP-1 agonists come with big price tags (perhaps too big), they could save the country billions each year in healthcare costs.
“For example, weight loss achieved through semaglutide can lead to a reduction in hypertension, which in turn may decrease the need for antihypertensive medications. Improved cardiac function could mean fewer interventions for heart-related issues, and better-managed diabetes can reduce the risk of complications such as neuropathy, retinopathy, and kidney disease, all of which can lead to hospitalizations and other costly interventions.”
While many drugs are overpriced, both in terms of production costs and in terms of recouping investment costs, any discussion of drug costs should acknowledge the positive externalities of pharmaceuticals.
Drug pricing and benefits