Anavex Life Sciences Corp (AVXL)

[jimmy667]

Drug prices are indirectly regulated by the third party payor system, i.e., Medicare and Insurance. To justify high prices expensive drug development is undertaken. Demand for specific medicine in somewhat inelastic. When a new better medicine is developed it will generally be more expensive than existing SOC. High drug prices are justified within the third party payor system by high development costs therefore development costs were pushed up as much as the market would bear by most of BP. Why would BP want to sell an effective small molecule drug that is inexpensive to produce and therefore will be priced at a fraction of the price of a monoclonal antibody drug that is ridiculously expensive to produce? Grabcashumab. One might conclude that expensive trials for expensive to produce drugs were driven in part by the “justify the price” culture of the third party payor system.