Relentless Health Value

In this health care podcast, I’m speaking with Maura Calsyn from the Center for American Progress—or CAP—and we’re talking about value-based drug pricing and the impact that COVID-19 may have on its definition, operationalism, and broad adoption. I remember a situation (kind of years ago, actually) where a pharma company decided to lower its price on an infused product. Normal supply and demand would dictate that if you lower your price, you will get more overall business, which will result potentially in more overall revenue—the old supply-and-demand curve at work. In this case, though, that pharmaceutical brand’s business plummeted. The Pharma had to raise their price again to capture the market share that they wound up losing by lowering their price. Why? Because doctors get paid a percentage of the drug cost to administer the product. So, the lower the drug price, the less a physician gets paid. Provider organizations have a big incentive to prescribe the highest-priced product—so, you know, the opposite