Good grief. £1300/person/year … “and pretty soon that starts adding up to real money”.

How is it done ? Just, the drug companies set different prices in different countries ?

Prices are set by markets rather than costs.

If it makes you feel better it means we are subsidizing medicines for Ghana.

I can see this as an argument in favour of changing the law on drug sales – but how would cutting the NHS budget do anything but make things worse? Your GP has tried to get you to shift to cheaper drugs – so it’s not complacency on their part. Do you believe the NHS (NICE?) could buy cheaper but chooses not to?

Pete

“how would cutting the NHS budget do anything but make things worse?”

If we paid the Ghanaian price, that _would_ cut the budget ?

Andy’s comment re subsidisation suggests that Reddy would then up the Ghanaian price ? I don’t know. There’s a whole other sub-argument there.

Andy

I strongly suspect that none of the higher price reaches Dr Reddy’s in India. I wouyld bet a very large sum that there is no significant difference between what Dr Reddy’s received for the packet that ended up in Ghana and the packet that ended up in the UK.

Ah. Where does the difference end up, then ?

In Canada, we have a dispensing fee that is added to the cost of medication. I don’t have any bills in front of me, but my thought is that the dispensing fee can easily be significantly greater than the cost of the drugs.

Here it makes big sense to get longer supplies of cheap prescription drugs as you only pay the dispensing fee once.

Craig you have found the crazy little profit margin at work within the NHS. The government through the drug tariff sets what it believes a medicine will cost (the £15 you mention). It will then remunerate the pharmacy that dispensed the prescription with this amount less your contribution and a percentage that is arbitrally decided every year (called the “claw back”).

The pharmacy however is able to buy in the mediation at any cost it can find. Including you £3 pound packs from Ghana (provided it can prove a reputable supply chain). The pharmacist then pockets the price difference.

It always brings a smile to my pharmacist colleagues when the newspapers get high and mightily about over paid GPs yet ignore them

As an additional note not all medications have quite such a vast price difference as omeprazole, some are even done at a loss. This doesn’t however quite balance out and this is where the pharmacy makes its profit. Not from selling shampoo as they would like you to think

Uh oh, Craig – argue for NHS budgets to be cut, and you play right into the hands of your Tory opponents. They’d love to cut the NHS budget, making the service so difficult to access that a demand is created for private alternatives. Then, a spiral of damage occurs as more of the middle classes leave the public service, leaving the poor with a system that meets their needs even less than it does today.

I am all for saving money, but please don’t get caught buying into privatisation ideology!

Craig, why do you ask such silly questions? You already know the answer. The guys who are responsible for overcharging you for drugs are the same Zionist plotters who rattle your back door…. Surely your disciple agrees?

We have a capitalist economy. The profits go to the shareholders of the manufacturing companies and middlemen like pharmacists or wholesalers (so far as they can). The alternative is government regulation of drug prices.

Craig,

Sounds like you should buy yourself a Prescription Prepayment Certificate (PPC) at £104.00/year:

http://www.nhsbsa.nhs.uk/1127.aspx

Though saving yourself money would cost the NHS more!

My doctor prescribe a statin for me. When I got home after picking up the tablets, I found the instructions to be in spanish. Nothing in english was on/in the box except the label put on by the pharmacist with my name and address.

How else with the pharmaceutical companies pay for all that slick advertising……….. I mean ‘research’.

Cancer Cured in Canada? Big Pharma Says NO WAY!

http://tv.globalresearch.ca/content/cancer-cured-canada-big-pharma-says-no-way

I agree that the drug companies have bought too much influence with the main parties and that this leads to excessive costs and needs to change, but the biggest problem with the NHS is PFIs (private finance initiatives)and ‘PPPs’ (‘public private partnerships’) which mean that most of our hospitals are being paid for by exorbitant annual payments from NHS trusts to PFI and PPP consortia of big firms. As a result the costs to taxpayers have increased massively while the number of fully trained staff has fallen, the number of beds available in new hospitals has fallen compared to those they replace (as most replace 2 or 3 older hospitals.

The cost and time taken to carry out basic maintenance (e.g changing a light bulb) have also gone through the roof under PFIs and PPPs.

Several people who work in NHS hospitals have told me about this and Professor Allyson Pollock and others have done a lot of studies of it.

If we want to reduce NHS costs we need to renegotiate PFIs and PPPs and also have lawyers on the look-out for breaches of contract by the PFI firms that can allow us to cancel the contracts (some of which are for a period of 50 or 80 years).

Craig wrote “So why is the NHS practice paying £15.50 for a packet of medicine available individually at retail price for £2.80 internationally?”

Probably because drug companies are paying money into party funds for both Labour and the Conservatives.

Much as I dearly love Craig and his blog, and would vote for him in a second, whenever I hear anyone talk about cutting the NHS, I want to take a stout stick to his head, bundle him onto an aeroplane, and send him to live in the US for a few years. Then come back and tell me all about the overcharging, socialist hellhole we have here in the UK.

There’s nothing wrong with the NHS that elimination of any taint of capitalism won’t solve. Well, that and cutting out IVF.

The disease: Big Pharma.

The cure: Nationalsation.

If the NHS is mismanaged (and parts definitely are), or paying too much for something, then we should fix those things and spend the money better on helping people.

NHS funding should never be cut, until the service is perfect; it should just be better spent.

Seconded love for Craig but I agree with Jon, and others. Cutting the NHS budget will do nothing to reduce the price of prescriptions: why would it?

And thanks, Duncan, for the background: Allyson Pollock’s very good, isn’t she? Another point people may like to consider is that the nearly bankrupt US health corporations have been circling round the NHS for some time; desperate to see a mass move towards private insurance and away from public health care. As the NHS itself becomes increasingly privatised, with concommitant layers of bureaucracy and the farming out of vital services, this is just what people are being forced to do.

“So why is the NHS practice paying £15.50 for a packet of medicine available individually at retail price for £2.80 internationally?”

Thank you, Ambassador Murray – you’ve just reminded me of how lazy, naive university students think, thus reminding me of my university days.

The effect of your sort of naive thinking would be to raise drug prices in Ghana.

You don’t need to go to Ghana to find this low price. In Spain the same drug is about the same price as in Ghana. Of course with the coalition governments plans for the GP-led NHS we will see drug prices rise even more: Same overall money going to the NHS so need to get upset on that point but in a structure which will inexorably lead to more private (US) profiteering at taxpayers expense.

‘Our’ Government is owned by corporate/banking interests. The purpose of government is to serve them not us. They are parasites. We are sheep. They take all they can but usually remember to leave us still living……for the next time.

technicolour – good point – i remember the US representatives to the WTO in the 90s arguing that public health services and public education were “barriers to trade” and so should be eliminated under WTO rules

Larry – Perhaps you, being supposedly so much more hard-working and so much more logical than the rest of us mere mortals in your thinking, could explain how calling for the British government to buy generic drugs more cheaply rather than branded ones at much higher cost, could possibly drive the price of generic drugs at £2.80 up by over 500% so they exceeded the cost of the branded ones at £15.50?

It’s possible that our NHS does not serve the people but is actually a racket to serve the big drug companies derived from IG Farben, whose controllers have had enough of us now and who now wish to implement mass genocide by introducing GM and flouride into the food chain, which possibly offers more opportunities for more profit.

One sickness of our system is that pension funds depend on the profits of the big Nazi-related drug companies.

We must not forget certain facts about Nazism.

1. it was a creation of the Wall Street/City of London Axis-of-Evil for war and trial of evil economics and science

2. after WW2 Nazism did not die, but was rather broken up into smaller pieces and survived. IG Farben is one prime example. Its children are bringing in GM. It was the Nazis who used flouride to supress populations en masse.

Many of these generic drugs are made by Israeli owned companies when I did some researching.

Flouride!

Finally!

BWWWWWAAAAHHHHAHHHHHHHAHHHHHHHAAAAAAAHHHHHHAAAAAAAAAAAAAAAAAA!

Douglas at July 6, 2010 2:36 PM,

thanks for exposing the mechanism of this particular scam. There must be hundreds like this, all involving public expenditure.

Craig,

it isn’t often that I disagree with you, but I’d regard reducing the NHS budget as far too blunt an instrument for trying to solve this type of problem.

Look up Teva

http://en.wikipedia.org/wiki/List_of_pharmaceutical_companies

and the fine upstanding citizen, their founder Eli Hurvitz.

Sepearately, a look at Gilead Sciences and the connection with Rumsfeld is also educational.

Surely what you are asking for, is better regulation of the pharmacies, not actual cuts to the NHS.

Why? Because drug companies can get away with paying more here.

I doubt it even costs £2.80 to make and distribute – its a generic, the research costs are long paid off.

Yes, after many years of watching various dynamics and experiments, I agree that reducing the ‘market’ aspects of the NHS would serve the people – i.e. us – and the NHS better. Not all of its problems are due to the aspects which Duncan referred to, but many of them are.

It’s complex, though, there are no perfect systems. Most of the health problems in the UK are due to more people living longer (a victim of success) and socio-economic inequality – wealth maldistribution as well as the various lobbies – sugar, food industry, etc. Drug companies also have a role to play in massive profiteering, distorting/dictating the research ‘evidence-base’ and medicalising things which ought not to be medicalised.

There’s also the ‘consumer demand’ aspect esp. in the South of England and the ‘worried well’ – this type of thing is curried by some of the various ‘alternative’ health industries as well as by drug companies.

Having a reasonably decent job or role in life goes a long way towards maintaining good health. So, the proposed job losses will, most definitely, impact enormously on ill health and the NHS budget. I saw this day-after-day during the 1980s-early 1990s. People got jobs, you hardly saw them. They lost their jobs and all kinds of (very real) illnesses, physical and mental, start to appear, to them and their families. It’s to do with money but more centrally with feeling you’re worth something, that you’re a human being in society. Crucially important.

You know, I hate Thatcher and I’ll hate here even after she’d dead, for what she did to this country. Destroyed manufacturing – needlessly! Shut all the mines – needlessly! Turned us all into servants of the ‘service sector’ and most particularly the financial services sector. Destroyed communities. Of course, Blair and Cameron and the rest are all Thatcher’s babies. We are living in Thatcher’s dream. And we think we’re awake, but we’re not.

Suhayl,

“It’s to do with [...] feeling you’re worth something, that you’re a human being in society. Crucially important”.

It seems almost certain that all the pressure put upon the jobless to continually apply for and fail to get jobs that are hugely over contested actually costs more to the NHS than it removes from the welfare budget.

Seeing as applying for jobs does nothing to create jobs, such pressure *can’t* reduce total benefit expenditure.

‘Destroyed manufacturing – needlessly! Shut all the mines – needlessly!’

There was a reason, to break the working class. To consolidate power for the few, over the many. Some await to see what the final outcome of where this consolidation will lead this country into. It was planned to be this way, in my humble opinion.

Of course it was, anonymous at 8:09pm, Of course it was.

Yes, Clark, that’s an excellent point.

It could be better with less capital. That requires attracting new talent and clearing out the old council like regime.

“It was planned to be this way”

“The Enemy within: Thatcher’s Secret War Against the Miners (Paperback)”…

http://tinyurl.com/c4xbbh

Great book to learn about ALL that happened.

It would (I think) be true to say that throughout history the capitalist system to keep going, has used a kind of “Chaos theory” to keep itself alive. Don’t let stability take hold for too long or it ferments and will settle down to a more stable state. A state not good for the few.

Follow up to my post above.

“Product Description

Margaret Thatcher branded Arthur Scargill and the other leaders of the 1984-5 miners’ strike ;’the enemy within’. With the publication of this bestselling book a decade later, the full irony of that accusation became clear. There was an enemy within. But it was not the National Union of Mineworkers that was out to subvert liberty. It was the secret services of the British state – operating inside the NUM itself. Seumas Milne revealed for the first time the astonishing lengths to which the government and its intelligence machine were prepared to go to destry the power of Britain’s miners’ union. Using phoney bank deposits, staged cash drops, forged documents, agents provocateurs and unrelenting surveillance, MI5 and police Special Branch set out to discredit Scargill and other miners’ leaders. Planted tales of corruption were seized on by the media and both Tory and Labour politicians in what became an unprecedentedly savage smear campaign. In this new edition, published for the twentieth anniversary of Britain’s most important postwar social confrontation, new material brings the story up to date – and, in the wake of the Iraq war intelligence scandals, highlights the continuing threat posed by the security services to democracy today.”

http://www.amazon.co.uk/Enemy-within-Thatchers-Secret-Against/dp/1844675084

Absolutely, TW, good posts.

Duncan F – I agree about PFI/PPP, and isnt it time we had some hard facts and numbers about the degree of involvement of private sector providers in the NHS, especially WRT frontline services? What I object to is public money going to pay for private sector executive salaries, bonuses and shareholder dividends. Those are the figures I’d really like to see published. Then we’ll know where we truly stand.

BTW, theres no point in trying to engage with Larry from St Loser; occasionally he makes a valid point on the rigour of argument or the validity of figures, but mostly he’s just along to chew on folks’ ankles.

Why not get 4 x 20mg @0.12p each here?

http://www.chemistdirect.co.uk/omeprazole-20mg-capsules_4_11989.html

From the Keep our National Health Service Public latest newsletter.

http://www.keepournhspublic.com/index.php

‘Where next for NHS after the election?

At our Annual General Meeting Dr Richard Taylor (former MP), Dr Kevin O’Kane (chair of the BMA’s London Region) along with other consultants and doctors, spoke in support of the NHS returning to the coherent single body it once was.

The AGM looked at the campaign’s priorities following the election of the coalition government. GP Jonathon Tomlinson gave a moving account of the importance of knowing your patients, their background and circumstances and the benefits of continuity of care when planning for the majority of patients GPs see. He showed how a fragmented NHS adversely affects patients with complex medical needs. See Jonathon’s blog on the NHS here

Dr Richard Taylor urged us to take forward the Health Select Committee report produced in March 2010 which condemned the market imposed on the NHS as “20 years of expensive failure”. Medical practitioners, other health workers and KONP campaigners voiced their concerns, citing examples of privatisation in action; many made the point about hidden privatisation, with private companies using the NHS logo.

For more on private companies hiding behind the familiar NHS logo check out our Facebook photo campaign.’

a~~

That good doctor Dr Richard Taylor Ind Wyre Forest who was not re-elected is quoted above. He is a great loss to the HoC. He was on the Health Select committee whose last report dated March 2010 is here.

http://www.publications.parliament.uk/pa/cm200910/cmselect/cmhealth/268/268i.pdf

PS Have no truck with the Patients’ Association btw. They are a front for privatisation. Have a look at who funds them.

I completely agree, ‘somebody’. Basic public services are best delivered by the state and/or local government. We should leave the private sector to get on with what it does best. Thanks for the information. Interesting how these front organisations all have ‘people-friendly’ names to misguide.

Craig, I fail to see your logic. Bigpharma is overcharging the NHS, to no surprise. So your answer is to cut the amount the NHS are given? Will this not just play into the hands of those who have enough to pay for medication and screw over those who don’t? What we need is to question why the NHS is not buying at the cheaper cost (potentially delivery charges and a monopolised market, but I digress). As a young disabled person dependant on state provided housing and medication (among other things), I dread to think of the alternatives. A reduction in NHS funding would have catastrophic consequenses for the severely disabled percentage of the population that are rarely seen (as it is not as presentable in the media as funding for children’s causes and it is easier to demonise that which is not seen).

Surely there are better ways to deal with this. I’m open to suggestions.

Totally agree, anonymous poster as 5:05pm. And, on a separate note, that is another reason why cutting home carers and other people who work amazingly hard and beyond the call of duty and do things with vulnerable people which are sometimes almost miraculous (for really low wages) is shameful and inhuman, but also ultimately counterproductive in terms of the overall economics.

I’m all for reducing needless targets and bureaucratic computer box-ticking/ paper-mountains, but I am most definitely NOT for cutting basic services. No. I’d rather see us bring back all the jets to their bases and all the soldiers from the trenches. That would save so much money – billions – not to mention all the measures amply discussed on these boards wrt investment banking, etc.

Somebody,

thanks for the link to “Keep Our NHS Public”. I saw that they have an on-line petition, so I signed it.

It’s just one thing after another, isn’t it? Every aspect of society is being run in wrong ways for the wrong reasons. I’ve lost count of the things I want to see changed. Campaigning for stuff, writing to my MP and MEPs, going on demos, just trying to find out the truth – if I did it full time, it still wouldn’t be enough! I’m sick of this. This is what our government is meant to do, it’s what they get paid for and I don’t.

Something that is not highlighted in your preamble is that there is a vast difference between what we pay for medication and what the NHS are charged. These figures are available from the British National Formulary. The copy I have seen is two years old and quotes the figure of £14.61 (presuming i have the right brand and dose – I fully understand how cheaper alternatives may not have the same effect due to the rollercoaster of medication that I’ve been on). The main question that is problematic for me is “how do pharmacuitical companies justify an 89p (5.7%) increase in price, when for the majority of that time there was deflation or very little inflation.

Now regretting posting as I can see by reading the other comments that Craig has not personally rebuffed any arguments. Either he is wrong, or this is another “say something provocative and stand well clear”.

Does this mean that by adopting the ‘Cut NHS funding argument’, you are choosing a liberal path that says a limited government is best (ie somewhat libertarian)? If so, good luck when you’re old enough to permenantly dependant on the state for a pension that no longer covers medication costs and a nursing home. You have enough to pay?

It just sucks for everyone else then…

It’s cheaper to buy anti-TB drugs over the counter in Spain or Saudi Arabia than to pay the prescription charge in the UK.

Even greater fiddles when dealing with the cost of generic anti-biotics such as Tetracycline. When I buy a course in Sri Lanka I normally get change out of 20p.

Hello

In Germany the prices for medcine are even higher than in the UK.

The problem is that the pharmaceutical lobby negotiates the prices for their products with a commission of all German Health insurances.

And the lobbyists are good.

And the pharmaceutical industry is good, too. They bribe doctors to make them prescribe more expensive “new” medication. Unfortunately “new” medication can be exactly the same formula as an older, cheaper medication plus some vitamins. If you add vitamin C to some medication you can legally copyright-protect the “new” formula and you can demand higher new prices. Fantasy land. Then bribe the doctors to make them prescribe the “new” medcine instead of the older sample.

That makes profit.

Some cheeky activist once wrote to the manufacturers of pharmaceutical substances and wanted to know what price a kilogram (ca. 2 lbs) of a certain cancer medication would cost.

The prices ranged between 50€ and 200€ per kilogram.

The cancer medication which uses one hundreth or one thousanth part of this substance costs 6.000€ / month.

That is the range of profit in the pharmaceutical industry.

Now one can imagine why developing countries and 3rd world countries just pay 1€/day to treat their HIV-infected patients and why the pharmaceutical industry finally agreed to this. Bet they are still making profit out of 1€/day.

Part of the price for medication is a profit for the chemists’ and there are many many many of them. My home town has about 80.000 inhabitants and 25 chemists’ within its own district boundaries. The next town (30.000 inhabitants) is just 10km away and there you can find another 12 chemist’s.

Everyone just makes his profits from this kind of gravy train.

Developing a new medication costs between 100-200 Mio €. the pharmaceutical industry makes BILLIONS of profit from just ONE medication provided it is a bestseller for some common disease (headache etc).

The many side effects of this illness called arteriosclerosis are quite severe. But just treating the many different side effects and not the cause helps making more profits. And guess what! There is no pharmaceutical company which would even try to produce medication to treat arteriosclerosis directly. This seems to be a conspiracy because many old people suffer from this disease and the side effects. But just treating the side effects makes so much more profits…

Maybe the government should pour some money into its own research institutions to find a medication. … According to free market enthusiasts this would not be a disadvantage to private companies, would it? As private companies clearly don’t want to tackle the issue of arteriosclerosis although they are clearly capable of this in financial and scientific terms…. ;-DDD

This would clearly be a matter of common welfare as everyone gets old one day and nearly every old person suffers more or less from arteriosclerosis… DD

I don’t think simply cutting down on the NHS would help. Improve the structure within the NHS. Expose the lobbyists and kick them out / reduce them to a productive quantity and quality.

This will not be done.

Know why?

Political parties and politicians are sponsored by companies and by pharmaceutical companies.

Politicans … see above.

The state-paid advisors of politicans are cut down so that politicians can turn to lobbyists only for advice.

(No seriously, a government simply needs advisors on many matters.)

G// Osb_or:ne studied Modern History which might explain why his understanding of the banking system (law, finance) and of national economics (Nat. Econom.) and of the dangers of cozying up to russian oli_gar:chs and hedge fund hea_vywei_gths (politics, philosophy, Machiavelli!) is soooooo poor.

Quite a rant.

Hope it is at least interesting and is a contribution to your blog.

German Girl

Craig, if you are ever tempted to diss the NHS, learn some facts. As is well known, except probably in the UK, the UK health system, even with all the demented attacks on it by corrupt and ignorant politicians, is probably the most efficient in the world. As another poster mentioned, just try the USA for a while. You get the biggest bang for the pound, and your price horror stories would be wonderful incredible bargains in the USA. As is not well known, health care even for the wealthy in the USA is inferior to health care for the poor in the UK. Specifically, a Harvard study a couple years ago showed that restricting to white Americans the top third in income in the USA lived shorter, sicker lives, basically across the board, with worse outcomes no matter what disease, than the bottom third of white Britons. Nothing is perfect, but your NHS is something you should be proud of.

I have red some of the posts now and I have to agree with them in one respect:

Just cutting the NHS does not solve the problem.

Cutting the NHS budget would not result in dropping prices for medication.

First all the people who no longer receive medication and are not capable of paying for medication out of their private purse would protest.

The would protest against pharmaceutical companies and politicans.

Whereas one can hold accountable politicians one can not hold accountable private companies.

Because private companies do not have to sell at a certain price in a free market economy. As a matter of fact they don’t have to sell at all. And they could simply attempt a gamble at putting politicians under pressure by refusing to sell their medicine for a lower price.

The cost of such actions would be paid by sick (poor) people who don’t receive treatment for at least some time.

And only after quite some time people would start to think about the right to resist (J.Locke).

The cost of such a strategy would simply be too high and the success can not be guaranteed.

On the other hand:

Why should a government not set up a pharmaceutical company / distributor of pharmaceutics?

Such a company could produce medication of no longer patent protected medcine and sell it cost-effective. They would not make any profits and cost less than free market medication and as there clearly is an indication to improve common welfare the government is clearly entitled to do something.

And if private pharmaceutical companies can produce medication so much more effective… let them prove it.

Setting up a pharmaceutical producer can’t be much more than the excessive prices for medication from private pharmaceutical companies.

Or such a state foundet pharmaceutical company could make profits of 10% which are put into the taxpayer’s purse. That would enable private companies to aim at producing the same medication under the same condition for a smaller profit rate than 10%.

(Compare: German food retail industry manages to stay alive with a profit margin of less than 3% and famous discount supermarket chain ALDI has a profit margin of about 1,5%. And demand for medication is about as predictable as food consumption. Means: rate of sick people / year is about constant statistically.).

I think there’s a confusion arising between means and end :- cutting the price of medication would, all else being equal, reduce the budget. Reducing the budget would not, all else being equal, reduce the price of medication.

German Girl,

excellent comments. Thank you.

One of government’s most important functions is to protect the public from the power of commerce and finance. Our governments are failing, bought out.

The main problem are places such as Boots and Tesco charging ridicuolous prices for the drugs. If people stopped taking there prescriptions to these places this would dramatically reduce the cost being spent on drugs within prescriptions. All generic drugs can be still be purchased from different countries and places and the NHS should be searching for the cheapest option.