Millions of people were outraged in 2015 when Turing Pharmaceuticals raised the price of a 62-year-old drug that is considered the gold standard in the treatment of a life-threatening parasitic infection from $13.50 to $750 overnight, a 5,000%-plus increase. Likewise, the cost of the drug cycloserine, which is used to treat multidrug resistant tuberculosis, jumped from $500 for 30 pills to $10,800 after its acquisition by Rodelis Therapeutics. We also learned of the soaring cost of EpiPen as well as price increases ranging from 200% to 500% for two life-saving heart treatments manufactured by Valeant of Canada, the nation that is the Promised Land to advocates of single-payer health care. In one especially notable case, Questcor Pharmaceuticals raised the price of a multiple sclerosis drug from $1,235 per vial to more than $29,000.
A House of Representatives report issued in 2014 found 10 generic drugs experienced price increases just a year prior, ranging from 420% to more than 8,000%.
With Americans shelling out over $370 billion on prescription drugs each year, we need to ask ourselves why these costs are escalating beyond all reason.
There’s a saying attributed to the late Rep. Jack Kemp that “if you subsidize something, you get more of it, and if you tax something, you get less of it.” No truer words were ever spoken.
In 2006, the federal government added a benefit to the 40-year old Medicare program. It was called Part D, and it provided for the coverage of prescription drugs for Medicare recipients. Medicare Part D handed 56 million new customers to America’s giant drug companies. With the federal government footing the bill instead of the purchaser, what happened? Well, the combined profits of the largest pharmaceuticals soared 34% in the first year alone, to $76.3 billion. And, in the decade ending in 2012, the 11 largest global drug companies saw an incredible $711 billion in profits. Medicare prescription drug coverage has proved extremely profitable to Big Pharma, less so to the average consumer who sees galloping cost increases for relatively routine medications. Of course, Big Pharma can charge you the taxpayers anything they want for drugs as Medicare is legally prohibited from negotiating the price of prescriptions with the government. That fact alone amounts to a massive $137 billion subsidy to the drug companies, according to the Congressional Budget Office.
We are told by Big Pharma that the true reason for these outrageous prices is the cost of research and development. That may be partially true, but only partially. The truth is that half of the scientifically innovative drugs approved in the United States from 1998 to 2007 were developed in university and biotech labs, not by Big Pharma. The drug companies also spend 19 times more on marketing than on research and development as they blanket our TV airwaves with advertisements for pills that promise instant deliverance from everything from erectile dysfunction to insomnia. This massive marketing campaign, which was unheard of just 30 years ago, has undoubtedly resulted in thousands, if not millions, of unnecessary prescriptions being written for patients who see the advertisements and demand the pills from their doctors, just like children will demand the latest cereal they see advertised on television from their parents. Have no doubt about it; the cost of advertising is built into the cost of every prescription you take.
Now, in recent years – especially since President Donald Trump focused public attention on the crisis—the role of Big Pharma in the opioid epidemic has come under greater scrutiny. Billions of dollars in profits have been recklessly made while capitalizing on the suffering of victims of chronic pain. Drugs such as Oxycontin were never intended for long-term use due to their addictive qualities. Yet, the Food and Drug Administration in league with drugmakers like Purdue Pharma , which is owned by the Sackler family whose net worth exceeds $14 billion, conspired to flood the American market with dangerous drugs like this. And the consequences have been devastating: 183,000 Americans died from prescription opioid overdoses between 1999 and 2015. Deaths from opioid overdoses in the U.S. jumped 17% in 2017 from a year earlier to more than 49,000. Deaths from fentanyl surged by 45%. Every day, more than 1,000 people are treated in emergency rooms for misusing prescription opioids.
Andrew Kolodny, co-director of the Opioid Policy Research Collaborative at Brandeis University, said the pharmaceutical industry funded a “multifaceted campaign” that “changed the way the medical community thought about opioids and changed the culture of opioid prescribing in the United States in a way that would lead to a public health crisis.”
It is easy to blame physicians for prescribing these deadly drugs, but physicians don’t manufacture or market them, nor do they have a say in the FDA’s approval process. Doctors have to rely on the information provided by the pharmaceuticals and the government regulators. In a sense, doctors have been victimized too.
Thankfully, a crackdown is in the works. Hundreds of lawsuits have been filed by state and local governments accusing major drug manufacturers and distributors like Purdue, Amerisource Bergen, Cardinal Health and McKesson Corp. of engaging in deceptive marketing and ignoring the fact that these drugs were being diverted for improper uses.
In April, the federal government charged distributor Rochester Drug Cooperative and company executives with felonies for their role in spreading the epidemic. The company has agreed to pay $20 million in fines. And, just days ago, an Oklahoma judge ruled against Johnson & Johnson in the first trial in the U.S. seeking to hold a drugmaker accountable for the irresponsible dissemination of opioids. The company has been fined $572 million with the state of Oklahoma arguing that J&J’s sales practices created an oversupply of the addictive painkillers and a “public nuisance” that upended lives and would cost the state up to $17.5 billion.
To break the iron grip that Big Pharma has on our nation, a number of things need to happen.
First of all, Medicare should be allowed to negotiate the prices of prescriptions with the drug companies, just like the Department of Veterans Affairs does. On some commonly-prescribed medications, Medicare pays between 64% and 100% more than the VA. Why?
Second, reform Medicare Part D so that the drug companies aren’t subsidized but the seniors.
Third, permit the importation of less-expensive medications from overseas so that Big Pharma is forced to compete with nations like Canada and Mexico, where people are hardly dropping dead in the streets from adulterated drugs.
Finally, streamline and reduce the length of time the FDA requires to approve new drugs. America has the longest approval process anywhere in the world, which only increases costs and delays getting new life-saving medications on the market.
Big Pharma spends billions of dollars – $2.5 billion just in the last decade – buying the Congress. Isn’t it time we demanded that our representatives and senators refuse to accept campaign contributions from those who have become wealthy off the unnecessary suffering and deaths of so many thousands of our fellow Americans? And, shouldn’t we expose those politicians who continue to do so?
Dr. James Veltmeyer is a prominent La Jolla physician voted “Top Doctor” in San Diego County in 2012, 2014, 2016, 2017 and 2019. Veltmeyer can be reached at email@example.com.