I have been relatively quiet about the skyrocketing cost of drugs, but it has now become impossible to remain out of the fray.
A Pharmaceutical company recently acquired a drug called Daraprim, the drug treats potentially fatal parasitic infections. After its acquisition the company raised the price of Daraprim by almost 5,0000%. When confronted with great anger about the price increase, the company at first declined to comment until their CEO answered critics with a series of dismissive tweets and interviews. The price of Daraprim remains out of reach for many individuals.
As we all know there are many drugs that have had their prices balloon out of reality. Irresponsible price increases have appeared across the board for drugs that treat everything from cancer, to gout, to Crohn’s disease to name just a few.
According to the Commonwealth Fund in 2014, around 35 million Americans did not fill their prescriptions because they couldn’t afford them. That’s one in five ill people in the United States that failed to take their medication because they could not afford it.
“When you’re charging tens of thousands or several thousand dollars for one infusion of a particular medication, now we’re getting to the point where you wonder, ‘How greedy can drug companies get?'” said Dr. Frank Esper, an infectious diseases expert at University Hospitals Case Medical Center in Cleveland, Ohio.
The Kaiser Family Foundation recently conducted a poll where they found about 72 percent of Americans say that prescription drug prices are unreasonable, and 74 percent of them believe that drug manufacturers put “profit before people.” The poll consisted of 1,200 respondents.
High pharmaceutical prices can result from a number of situations, but the evil that underlies many of the prices can be squarely attributed to pharmaceutical companies that are simply greedy. Companies are acquiring essential medications and then squeezing as much revenue as possible from them despite the human cost.
Not unlike the Daraprim example cited, three weeks ago another pharmaceutical company acquired a tuberculosis drug called Cycloserine and raised the price of 30 pills from $480 to $10,800. However, after a great public outcry the company reconsidered its position and returned the rights for Cycloserine to the Purdue Research Foundation’s Chao Center and the rise was returned to its previous level.
Allan Coukell, senior director for health programs at the Pew Charitable Trusts said that drug acquisitions like those of Daraprim and Cycloserine describe a new business model in which investors buy up niche drugs, become the sole source manufacturer of those drugs, increase prices, and collect the profits, without any regard to the underlying costs or the human cost that the price increases will cause people.
This sole source business model has prompted the Michigan Health Center UP Health System – Marquette to reduce its use of a drug called nitroprusside after its cost jumped from $40 to $615 a vial. Nitroprusside is an important drug that reduces bleeding during surgery, treats congestive heart failure, and lowers blood pressure. According to a recent newsletter the health system indicated that they were also concerned about other common drugs they use such as phytonadione, flucytosine, vasopressin, isoproterenol, and glycopyrrolate, whose prices have swelled to between four and 40 times their previous levels.
As in the case of the six new drugs that have been approved for the treatment of advanced prostate cancer, these drugs have come to market at whatever price point its manufacturer thinks people are willing to pay. History has shown us that prices eventually fall as much as 80 percent once the drug’s patents expire and generic drugs enter into the market, but this isn’t always the case. Even if there is a generic and the price drops, these staggering drug costs must be borne by us until the patents for them have expired and a generic alternative has been developed and approved for use by the FDA.
In some instances pharmaceutical companies have made payments to generic drug makers not to develop or to delay the development of a cheaper, generic alternative!
If you don’t have health insurance it is impossible for most of us to afford our life saving drugs. Even people with health insurance often are unable to afford to pay the required co-pays and deductibles. In other instances the high price of a drug prevents some insurance companies from paying for a drug because it isn’t in the insurance company’s formulary.
No argument from me, if you spend money to develop a drug you should be able to re-coup your costs. These costs should not only include the direct research costs for a particular drug, but it should also include a return on the research and development costs for research that wasn’t successful. Additionally, the cost of manufacturing, sales and distribution, along with a reasonable profit should be used to calculate a fair price for a drug.
Lives saving drugs are not like other commodities that an individual can decide to due without. Live saving and life extending drugs should not be looked at as if they are luxury cars, a second home or a vacation. We human beings should have developed beyond the total greed that has recently been demonstrated by some individuals and companies.
The good news on this topic is that some legislators have taken notice of the issue. After working on this issue for a number of years, Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) introduced the Prescription Drug Affordability Act of 2015. The bill would instruct the Department of Health and Human Services to negotiate Medicare prices, allow wholesalers to import drugs from Canada, require more transparency around pharmaceutical prices, and prohibit anti-competitive deals in which brand-name drug manufacturers pay generic drug makers for them to delay bringing a cheaper alternative to market.
“When we talk about health care, we are talking about the need of the American people to be able to afford the medicine their doctors prescribe,” Sanders, a presidential candidate said the day he introduced the bill. “A life-saving drug does no good if the American people cannot afford that drug.”
Sanders and Rep. Elijah Cummings (D-Md.) wrote to Valeant Pharmaceuticals International last month to ask why Valeant raised the price of two of their newly purchased drugs, Isuprel (price raised by 525%) and Nitropress (price raised by 212%). Both of these drugs are important heart medications which are vital to many individuals.
In response to Sander’s and Cummings inquiry Valeant’s senior vice president of investor relations, Laurie Little, responded she said that determined that Isuprel and Nitropress were underpriced before it acquired them in February. She said, “These are drugs that are only used by hospitals — they are not sold in pharmacies — in accordance with specific surgical procedures,” she said. “This means that whenever the protocol calls for use of these drugs, they are used. Patients are never denied these drugs when the protocols call for their use.” What she was saying is to hell with the society, we want to maximize our profit despite the cost to our society.
Hillary Clinton, who is another candidate for President, recently tweeted that she would also introduce a plan to combat high drug prices. Her tweet was in response to the price increase for Daraprim. It looks as if her plan will include out-of-pocket cost caps, using America’s “bargaining power” to demand lower prices and higher rebates, and increasing competition with proposals that would encourage the release of more generic drugs, such as clearing the FDA’s generic drug approval backlog.
I am hopeful that some of the Republican candidates will speak to this burning issue. Reigning in the abusive costs of vial drugs should be an issue that is of bi-partisan concern.
Because of the unbridled greed that some individuals and companies have exhibited we seriously need to reconsider allowing our life saving and life extending drugs to be subjected solely to market forces.