CC BY-SA 4.0<\/a><\/p>\nIn early February, drug company Novo Nordisk sued telehealth company Hims & Hers.<\/p>\n
The complaint: Hims & Hers sells GLP-1 drugs at lower prices than Novo Nordisk. That\u2019s the simple version.<\/p>\n
The legalese version is that because semaglutide (the drug behind the Novo Nordisk\u2019s \u201cWegovy\u201d brand name) was removed from the US Food and Drug Administration\u2019s \u201cDrug Shortage List\u201d more than a year ago, \u201ccompounding pharmacies\u201d like Hims & Hers no longer operate under a Very Special Important Legal Dispensation to produce it without the permission of Novo Nordisk, which has a Very Special Important Government-Granted Monopoly, aka a patent, on the substance.<\/p>\n
\u201cThis is a complete sham, and it has been a sham since the shortage ended,\u201d Novo Nordisk attorney John Kuckelman tells CNBC.\u00a0 \u201cThe fact is that their medicines are untested, and they\u2019re putting patients at risk.\u201d<\/p>\n
That last part is a startling claim from an attorney about his own client\u2019s product (the difference between semaglutide from Hims & Hers and semaglutide from Novo Nordisk is the name on the label), but I\u2019m more interested in the \u201cshortage\u201d claim.<\/p>\n
Novo Nordisk recently introduced Wegovy in pill form, at a price of about $150 a month. Hims & Hers had planned to offer the same chemical compound, without Wegovy branding, for about $50 a month.<\/p>\n
The whole POINT of Novo Nordisk\u2019s attempt to enforce its patent is to CREATE a shortage of semaglutide in pill form.<\/p>\n
Why? Money. The patent, if enforceable, allows Novo Nordisk to charge customers AT LEAST three times as much for its pill as the market says it can\u00a0 be sold profitably for. Hims & Hers wouldn\u2019t offer it for $50 if it expected to lose money doing so.<\/p>\n
In the theoretical economic environment of \u201cperfect competition,\u201d prices settle at, or infinitesimally above, the cost of production, because the seller who doesn\u2019t offer the lowest possible price won\u2019t move much product.<\/p>\n
\u201cPerfect competition\u201d is indeed hypothetical. A million variables affect a million things. If my pencil factory is further from the store than yours, you won\u2019t have to spend as much on shipping. If I make a better pencil commercial than you do, more people will convince themselves my pencils are better than yours. And so on, and so forth.<\/p>\n
But even absent \u201cperfect competition,\u201d most people wouldn\u2019t voluntarily pay three times as much for the same thing from Novo Nordisk as they\u2019d pay for it from Hims & Hers.<\/p>\n
So, what is the purpose of patents?<\/p>\n
According to the US Constitution, it\u2019s to \u201cpromote the progress of science and useful arts\u201d by giving inventors the \u201cexclusive right\u201d to their inventions for some set period of time.<\/p>\n
But that\u2019s just another way of saying the purpose is to create artificial shortages so that inventors don\u2019t have to compete with others who may copy their inventions \u2014 or even independently invent similar things.<\/p>\n
Novo Nordisk has already reaped the benefits of being first to market and promote semaglutide, and has fared well in competition with other GLP-1 products from other inventors\/manufacturers. Apparently doing well in competition isn\u2019t enough, though \u2014 it wants the government to remove its competitors from the market.<\/p>\n
Given the hype around semaglutide and other GLP-1s \u2014 it seems we\u2019re being led to believe that they cure, prevent, or minimize the effects of pretty much every negative human condition, physical and mental \u2014 I\u2019d say they make a pretty good test case against the fiction of \u201cintellectual property.\u201d<\/p>\n
While I\u2019m skeptical for the wildest claims about the benefits of GLP-1s, they\u2019re clearly beneficial to enough people, in enough ways, that we should ask why governments are handing out price-gouging opportunities, in the form of monopolies, on them.<\/p>\n","protected":false},"excerpt":{"rendered":"Image Source: Lthoms11 \u2013 CC BY-SA 4.0 In early February, drug company Novo Nordisk sued telehealth company Hims…\n","protected":false},"author":2,"featured_media":280957,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33],"tags":[134,524,111,139,69],"class_list":{"0":"post-280956","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-medication","8":"tag-health","9":"tag-medication","10":"tag-new-zealand","11":"tag-newzealand","12":"tag-nz"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/280956","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=280956"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/280956\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/280957"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=280956"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=280956"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=280956"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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