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[e-drug] Cost of R&D for new medicines

E-DRUG: Cost of R&D for new medicines

Dear Colleagues,

Below is the link to the most-read entry on the PLoS Medicine blog concerning 
new, high estimates of the average cost of R&D for a new medicine. This figure 
was developed in the mid-1970s by industry-supported economists as an 
artificial, high estimate in a campaign to get Congress to extend patent 
protections. In fact, any such estimate (including our own) is part of an 
artificial game that has little to do with actual costs of R&D for a given 
target or medicine. Still, one can learn how the high estimates are built up 
and how much they are built on a few, unverifiable numbers.  More detail can be 
learned at www.pharmamyths.net, click on "Demythologizing..."

PLoS Medicine blog by Light & Warburton on Forbes estimate of “staggering 
costs” of R&D
 [repair link before clicking]

-  And interesting comments: 
[repair link before clicking] 

Donald Light
Princeton university, USA

Donald W. Light
Cell: 609-216-0071
Professor, UDMNJ-SOM
Lokey Visiting Professor, Stanford University 
Visiting Researcher, Center for Migration & Development, 
Princeton University

On Mar 13, 2012, at 3:59 AM, <Niëns@healthnet.org> wrote:

E-DRUG: Measuring medicine affordability: new study published in WHO Bulletin

Dear E-druggers,

Herewith I'd like to bring to your attention a paper we published in the 
Bulletin of the World Health Organization on measuring the affordability of 
medicines in low- and middle-income countries. For an abstract of the paper 
titled Practical measurement of affordability: an application to medicines 
please see below. The complete paper can be accessed here: 
http://www.who.int/bulletin/volumes/90/3/10-084087.pdf .

Kind regards,
Laurens Niëns
on behalf of all co-authors


Objective: To develop two practical methods for measuring the affordability of 
medicines in developing countries.

Methods: The proposed methods - catastrophic and impoverishment methods - rely 
on easily accessible aggregated expenditure data and take into account a 
country's income distribution and absolute level of income. The catastrophic 
method quantifies the proportion of the population whose resources would be 
catastrophically reduced by spending on a given medicine; the impoverishment 
method estimates the proportion of the population that would be pushed below 
the poverty line by procuring a given medicine. These methods are illustrated 
by calculating the affordability of glibenclamide, an antidiabetic drug, in 
India and Indonesia. The results were validated by comparing them with the 
results obtained by using household micro data for India and Indonesia.

Findings: When accurate aggregate data are available, the proposed methods 
offer a practical way to obtain informative and accurate estimates of 
affordability. Their results are very similar to those obtained with household 
micro data analysis and are easily compared across countries.

Conclusion: The catastrophic and impoverishment methods, based on macro data, 
can provide a suitable estimate of medicine affordability when the household 
level micro data needed to carry out more sophisticated studies are not 
available. Their usefulness depends on the availability of accurate aggregated 

Laurens Niëns, MSc, MA
Scientific researcher
Institute for Medical Technology Assessment (iMTA)

Erasmus University Rotterdam
Room J5-31 (J-building)
Burgemeester Oudlaan 50, 3062 PA Rotterdam
PO Box 1738, 3000 DR Rotterdam
The Netherlands

Phone: +31-10-4088550
fax:   +31-10-4089081
email: niens@bmg.eur.nl
web:   www.imta.nl

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