<h4>Welcome to Section 2</h4>
<h2>Pharma-trauma</h2>
<img src="https://www.transperfect.com/sites/default/files/pill-bottle-spill.jpg" height =100% width =100%>
You should have been assigned a role by Kahhow (Mr Lee). Please proceed with the predefined role:
[[Consumer -> Consumer]]
[[Producer -> Producer]]<img src ="https://lteconference.files.wordpress.com/2015/07/red-pill-blue-pill.jpg" width=100% height=100%>
Will you take the:
[[red pill->red pill]]
[[blue pill->blue pill]]<h2> Big Pharma - it is not easy to be me </h2>
It is tough being a big pharma company given how much flak the media gives you.
<img src="https://www.washingtonpost.com/resizer/GVegL0Py90nbdypDWmP2_zBm3qs=/1058x0/arc-anglerfish-washpost-prod-washpost.s3.amazonaws.com/public/D7JJHUKSBU6VNMMRYUTKU2OWA4.png" width=100% height=100%>
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<h3>Table 1: Profits of Pharmaceutical Companies ($ billion)</h2>
<table id="t01">
<tr>
<th>Company</th>
<th>Total Revenue</th>
<th>R&D and Marketing Cost</th>
<th>Profit</th>
</tr>
<tr>
<td>Johnson & Johnson (US) [[Find out more->JJ]]</td>
<td>71.3</td>
<td>25.7</td>
<td>13.8</td>
</tr>
<tr>
<td>Novartis (Swiss) [[Find out more->Novartis]]</td>
<td>58.8</td>
<td>24.5</td>
<td>9.2</td>
</tr>
<tr>
<td>Hoffmann-La Roche (Swiss) [[Find out more->Hoffmann]]</td>
<td>50.3</td>
<td>18.3</td>
<td>12</td>
</tr>
<h3>Task</h3>
Explain the possible relationships between profit levels and costs incurred in R&D and marketing.
Done? [[Proceed -> Proceed]]
<img src="https://66.media.tumblr.com/662205e91df9fcea88a766c2d126691a/tumblr_n79i4l4m6Q1trb667o1_1280.jpg" width=100% height=100%>
<h3>You just went down the rabbit hole...</h3>
Just a warm up but it illustrates a problem prevalent in healthcare.
- Do consumers know the full effects of the drugs they are taking?
- If the doctor recommends the red pill over the blue, which one are you more likely to take?
[[red pill->red pill(1-1)]]
[[blue pill->blue pill(1-2)]]<img src="https://66.media.tumblr.com/662205e91df9fcea88a766c2d126691a/tumblr_n79i4l4m6Q1trb667o1_1280.jpg" width=100% height=100%>
<h3>You just woke up in bed...</h3>
Just a warm up but it illustrates a problem prevalent in healthcare.
- Do consumers know the full effects of the drugs they are taking?
- If the doctor recommends the blue pill over the red, which one are you more likely to take?
[[red pill->red pill(2-1)]]
[[blue pill->blue pill(2-2)]]
<img src="https://dartmed.dartmouth.edu/summer09/images/disc_drug_facts_we/Maxtor.jpg" width=100% height =100%>
Like many, you tend to trust your doctor and probably believe some medical advertising as well.
However, the fact that the doctor has more information than you do may lead to market failure.
<h3>Task 1</h3>
- Identify this source of market failure
- Explain how this leads to market failure
[[Proceed to consumer demographics -> richpoor]]That is an unconventional take. Most people tend to trust their documents because they believe that their doctors are in a better position to make more informed decisions on their behalf.
The fact that the doctor has more information than you do may lead to market failure.
<img src="https://i.ytimg.com/vi/39pGjqqp1t4/maxresdefault.jpg" width=100%, height=100%>
<h3>Task 1</h3>
- Identify this source of market failure
- Explain how this leads to market failure
[[Proceed to consumer demographics -> richpoor]]That is an unconventional take. Most people tend to trust their documents because they believe that their doctors are in a better position to make more informed decisions on their behalf.
The fact that the doctor has more information than you do may lead to market failure.
<img src="http://costcoconnection-cdn.texterity.com/connection/201904/data/articles/img/073.jpg" width=100% height =100%>
<h3>Task 1</h3>
- Identify this source of market failure
- Explain how this leads to market failure
[[Proceed to consumer demographics-> richpoor]]<img src="https://twt-thumbs.washtimes.com/media/image/2017/02/08/2_8_2017_b4-dibacco8201_c0-308-1800-1357_s885x516.jpg?89bb99d4ecb9bcbc76ee82d15673860f0bc79939" width=100% height=100%>
Like many, you tend to trust your doctor and probably believe some medical advertising as well.
However, the fact that the doctor has more information than you do may lead to market failure.
<h3>Task 1</h3>
- Identify this source of market failure
- Explain how this leads to market failure
[[Proceed to consumer demographics -> richpoor]]<img src="https://cdn1.vectorstock.com/i/1000x1000/23/00/weight-scale-between-rich-man-and-poor-man-vector-15502300.jpg" width=100% height =100%>
<h3>Task 2</h3>
As a rich person, what is your likely PED value for medicine?
As a less well-off person, What is your likely PED value for medicine as a less well-off person?
Explain the likely values.
Do you trust corporations to act in your interests?
[[Yes-> Trust]]
[[No-> Distrust]]<img src="https://commit-global.com/wp-content/uploads/2019/03/pharmacy-background-design_1212-523.png" width=100% height=100%>
<h3>Task</h3>
Explain why the profit motive is aligned with your interest as a consumer.
<br>
Click [[here->final]] to proceed
<br><br>
If you regret your choice, you may [[click back -> richpoor]] <img src="https://commit-global.com/wp-content/uploads/2019/03/pharmacy-background-design_1212-523.png" width=100% height=100%>
Explain why the profit motive is <b>not</b> aligned with your interest as a consumer.
<br>
When you are done, click [[here -> final2]] to proceed
<br><br>
If you regret your choice, you may [[click back -> richpoor]] <h1>END</h1>
You are a trusting consumer which is quite an exception in a post-trust environment - negative publicity has nudged society to be more skeptical towards pharaceutical and healthcare industry in general.
<img src = https://i0.wp.com/images-prod.healthline.com/hlcmsresource/images/News/051717_testingdrugs_THUMB_LARGE.jpg?w=1155 width=100% height =100%>
Congratulations on completing the exercise.
You may now use the iPad and explore some easter eggs planted to explore the various infamous pharma scandals in history
<h1>Johnson & Johnson</h1>
is an American multinational corporation founded in 1886 that develops medical devices, pharmaceutical and consumer packaged goods.
Recently it has been sued/ is on trial in Oklahoma for reasons summarized in the following image:
<img src="https://static01.nyt.com/images/2019/08/26/science/26WHYJANDJ1/26WHYJANDJ1-superJumbo.jpg?quality=90&auto=webp" width=100% height =100%>
[[Back -> Producer]] <h1>Novartis <h1>
is a Swiss multinational pharmaceutical company based in Basel, Switzerland. It is one of the largest pharmaceutical companies by both market capitalization and sales.
<img src="https://assets.bwbx.io/images/users/iqjWHBFdfxIU/izN7.cFUzxFE/v1/1400x-1.jpg" width=100% height=100%>
<i> A Novartis research lab</i>
Novartis told the US Food and Drugs Administration (FDA) in June 2019 that it had discovered the potential manipulation of animal-testing data related to the medication, Zolgensma after the $2.1 million-a-dose treatment had already hit the U.S. market.
[[Back -> Producer]] <h1>F. Hoffmann-La Roche AG</h1>
is a Swiss multinational healthcare company that operates worldwide under two divisions: Pharmaceuticals and Diagnostics
<img src="https://www.roche.com/dam/jcr:fa6a4911-1dc3-4ac7-9ef8-f4d3f99f7e9c/de/history_740px.jpg" width=100% height=100%>
<i> The founder, Fritz Hoffman La Roche</i>
Early on, the Basel-based pharmaceutical company made a variety of novel drugs aimed at the masses, from painkillers and sleep aids to heart drugs, antibiotics and breakthrough anxiety drugs such as Valium. Read more <ahref ="https://www.latimes.com/archives/la-xpm-2003-jul-21-fi-roche21-story.html">here</a>
Over the last decade or two, its focus switched to specialty drugs with smaller markets -- ones used mainly in hospitals or prescribed by specialists in cancer, dermatology, organ transplants, AIDS and hepatitis. Few of its products are household names because Roche doesn’t plaster consumer ads all over TV and newspapers. And it doesn’t rush to copycat competitors’ successes.
<img src="https://images-na.ssl-images-amazon.com/images/I/91XAmxsnikL._SX355_.jpg" width=40% height =40%>
<i> Zantac is a popular drug in the US</i>
It also created a division that makes diagnostic tests and rolled out major drugs. They include Dalmane for insomnia, the antibiotics Bactrim and Rocephin, Accutane for severe acne, blockbuster ulcer drug Zantac, painkiller Toradol and the sedative Versed.
[[Back -> Producer]] Choose your role:
[['Pharma Bro' Martin Shkreli -> Martin2]]
[[Novartis vs Indian government ->Novartis2]]
India’s top court dismissed Swiss drugmaker Novartis AG’s attempt to win patent protection for its cancer drug Glivec, a blow to Western pharmaceutical firms targeting India to drive sales and a victory for local makers of cheap generics.
<h1>Task</h1>
- How will this affect the contestability of market for cancer drugs in India?
- As an Novartis executive, how will this affect your output and pricing decisions?
[[Proceed->India]]<h1>You are Martin Shkreli</h1>
<img src ="https://image.cnbcfm.com/api/v1/image/104634073-GettyImages-826146232-1.jpg?v=1532563784&w=678&h=381">
You founded a company called Turing Pharmaceuticals.
As of 2015, with Turing Pharmaceuticals' acquisition of the US marketing rights for Daraprim tablets, Daraprim has become a single-source and specialty pharmacy item. [[Wait, what is Daraprim again? -> Daraprim]]
What should your pricing strategy be for Daraprim?
[[Sky high! Increase price drastically -> pspike]]
[[Increase it by a little ->pincrease]]
[[Keep prices low -> pconstant]]This is
<h1> Daraprim </h1>
<img src ="https://upload.wikimedia.org/wikipedia/commons/thumb/5/52/Pyrimethamine2DACS.svg/300px-Pyrimethamine2DACS.svg.png">
Otherwise known as Pyrimethamine.
It is used to treat Isosporiasis (intestinal disease due to contaminated food or water), Toxoplasmosis (infectious disease from poorly cooked food), prevent lung fungus for people with HIV/AIDS and previously used to treat malaria.
Given its importance to treat diseases, what is the likely PED value?
[[Back -> Martin2]]
<img src = https://fsmedia.imgix.net/e7/e7/04/47/11d7/482f/99eb/7733ed714bea/ugh.jpeg?rect=0%2C161%2C2040%2C1021&auto=format%2Ccompress&dpr=2&w=650>
You are truly a pharma bro!
This is consistent with what we have learn so far:
- Producers aim to profit maximize
- If demand is price inelastic, producers have the incentive to raise prices as their pricing strategy
- This may involve some backlash, as seen by how Martin has been vilified as a pharma bro in media
<h2> Final Task </h2>
How does the profit motive lead to 'a conflict of interest...[with] the social, medical and economic needs of the public'?
Click [[here -> End]]This is consistent with what we have learn so far:
- Producers aim to profit maximize
- If demand is price inelastic, producers have the incentive to raise prices as their pricing strategy
- Gradual increments are unlikely to attract negative publicity - case in point, Martin raised prices by 5000% and became a public enemy, 'Pharma Bro' overnight
Click [[here -> End]]Well... you really don't care about profit maximizing, do you?
Click [[here -> End]]You are a typical consumer in a post-trust environment - negative publicity has nudged society to be more skeptical towards pharaceutical and healthcare industry in general and you have clearly internalized this disbelief.
<img src = https://i0.wp.com/images-prod.healthline.com/hlcmsresource/images/News/051717_testingdrugs_THUMB_LARGE.jpg?w=1155 width=100% height =100%>
Congratulations on completing the exercise.
You may now use the iPad and explore some easter eggs planted to explore the various infamous pharma scandals in history
<img src = https://i0.wp.com/images-prod.healthline.com/hlcmsresource/images/News/051717_testingdrugs_THUMB_LARGE.jpg?w=1155 width=100% height =100%>
Congratulations on completing the exercise.
You may now use the iPad and explore some easter eggs planted to explore the various infamous pharma scandals in history
<h1> Precedence for Patent rejection</h1>
If you feel snubbed that Novartis is alone in her rejection...
Pfizer’s cancer drug Sutent and Roche’s hepatitis C treatment Pegasys too lost their patented status in India last year, decisions the companies are fighting to have reversed. The Supreme Court’s latest ruling will make it tougher for them to win back patent protection.
<h2> However, cancer drugs like <u><i>Herceptin</u></i> are available in India only at a very high cost </h2>
[[Why? ->Why]]
<h2>The Whole game changed</h2> after the judgment was passed in the case of Pfizer Products granting the patent to produce such vaccine until 2026 damaging the country's drug industry. It gave the company exclusive rights to distribute vaccines in India and blocked the manufacturing of such drug.
<h2> Final Task </h2>
How does the profit motive lead to 'a conflict of interest...[with] the social, medical and economic needs of the public'?
KIV: How do patents change output and pricing decisions of pharma firms?
Click [[here -> End]]