By Sicong Li (’17)
The Second annual UCLA HBA Healthcare Conference officially kicks off on Saturday, January 30, with the theme Innovation at a Crossroads. Be sure to ink this event into your date books, because you’ll want to hear what happens at the conference.
Why? Consider this: Last August, Turing Pharmaceuticals acquired a drug called Daraprim and quickly raised the drug’s price from $13.50 per tablet to an appallingly hard-to-swallow $750 per tablet. Daraprim is a 62-year-old drug long considered the standard of care for life-threatening parasitic infection. More alarmingly, this is not an isolated occurrence, huge price increases are being seen across the board.
In fact, at the forefront of public discourse are health care costs and pharmaceutical pricing, like the Daraprim example and a recent subpoena of Valeant pharmaceuticals in response to steep price hikes for two of its heart drugs. The health care conference will provide a morning panel on these topics featuring Matt Nye, vice president of pharmacy service at Blue Shield, and Chad Pettit, value and access director at Amgen. Attendees can most likely expect an impassioned discussion.
Global pharmaceutical spending crossed the $1 trillion threshold in 2014 and is on trajectory to reach $1.3 trillion by 2018. The top five most expensive drugs range from $375,000 per year to $1.21 million per year in treatment costs. The traditional argument in favor of pharmaceutical and biotechnology companies is that price increases are justified by the burgeoning costs of research and development. R&D in orphan diseases generate small returns for biotech and pharma, hence their tendency to charge more for blockbuster products to help recoup other costs. R&D expenses across the industry have increased from $128 billion in 2009 to $142 billion in 2016. The biggest pharmaceutical companies regularly spend up to 20% of yearly revenue on R&D alone.
Another trend tied to drug pricing is the emergence of biosimilar. Recently, Samsung Bioepis’s Benepali (Benepali is a biosimilar to Amgen’s blockbuster Enbrel, marketed and sold in Europe by Pfizer) became the first biosimilar approved in Europe. The consensus forecast tells us the emergence of biosimilars will bring down the price of current biological products. However, obtaining regulatory approval has not been easy. Big biotech and biopharma are fighting back by seeking methods to extend patents and obtain new ones for additional indications. Unfortunately, this trend may have some unforeseen consequences. Feeling the pinch from patent cliffs and impending competitions, pharmaceutical and biotechnology companies often raise prices immediately before patent expiration. As an added defense, many biotechnology companies are focusing their efforts on biosimilar production rather than original R&D.
Regardless of where you stand on drug pricing, 2016 will definitely be an interesting year in the pharmaceutical and biotechnology world. In addition to thoroughly examining this hot topic, the HBA Healthcare Conference conference will feature speakers from various branches of health care, including payer, provider, pharmaceutical, biotech and digital health. We expect lively debates on topics ranging from digital innovations in health care to transforming the biopharma landscape. This is a wonderful chance for students and faculty across UCLA to participate in active dialogues with industry insiders to better identify and understand problems and opportunities for the coming year. We look forward to hearing your thoughts on these subjects at the UCLA HBA Healthcare Conference.
Register now for the 2nd annual UCLA HBA Healthcare Conference