Monday, April 28, 2008

Pharma: Low Market Pentration Rates Due to Structural Issues

This article gives some examples of why a drug, even if highly effetive, might not achieve market saturation. In the case of radioimmunotherapies, which can cost upwards of 50,000 a year for treatments, sometimes penetration rates only go as high as 10%. Here are some thoughts as to why from the article:

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Under federal rules, hospitals that do not offer a drug to Medicare patients are barred from offering it to other patients, even if their insurers fully cover the cost of treatment. Because Bexxar and Zevalin contain radioactive material, the drugs must be administered by specially licensed technicians and doctors. They are usually given in hospitals.
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The drugs can require private cancer doctors to transfer their patients to hospitals, and the private doctors may view the hospitals as competitors. As a result, fewer than 10 percent of patients who are candidates for the drugs get them.
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