Am I Next? Combining cheap drugs into expensive branded drug.

There is little or no doubt in my mind that one of the most potent ways to stay employed is to work for a profitable company. Knowing that one of the most significant drivers of profitability is margin, let us think about how to turn two aging products into a gold mine of profitability.

Consider how combining two older(and cheaper) drugs into a single package and repricing the newly created product at a premium can boost margins and profit levels significantly.

Vimovo is a combination drug, containing two older generic medications; a combination of esomeprazole, a proton-pump inhibitor which reduces stomach acid and naproxen, a nonsteroidal anti-inflammatory drug with the known side effect of stomach upset. 

The key unique selling point for Vimovo is "The Smarter Naproxen -- Due to added gastroprotection." Not to mention the marginal convenience of taking a single pill instead of two pills. 

My insurance plan's drug formulary for 90 day supply ...

VIMOVO 500 mg/20 mg modified-release tablets: 90 tablets at $1184.20 compared against its components: Esomeprazole 20 mg tablets: 90 tablets at $90.00; and Naproxen 500 mg DR tablets: 90 tablets at $0.00. 

Local drug store for 60 day supply ...

VIMOVO 500 mg/20 mg modified-release tablets: 60 tablets at Costco $2313.33 compared against its components: Naproxen 500 mg DR tablets: 60 tablets at  Costco $21.66; and Esomeprazole 20 mg tablets: 60 tablets at Costco $76.27.

While wholesale and contractual prices are significantly less than retail, the product appears to be a profitable endeavor, even after advertising costs.

What appears to make this drug compounding scheme work is that most physicians and consumers care little about the actual cost of medications when the tab is picked up by the government or insurance companies. And, if there is no disincentive for a physician to write the single prescription for the higher priced drug rather than two for the drug's components, they are likely to write the single prescription. 

The takeaway is that there are profits under your nose that can boost your company's profitability and help save your job. Keep your eyes and mind open to the opportunities that may be right in front of your face.