Drug pricing is a deadly national scandal
“Your money or your life!” was a laugh line in a radio skit by the comedian Jack Benny, who pretended to be a skinflint. To the robber’s demand, Benny replied, after a long pause, “I’m thinking. I’m thinking.”
Today, your money or your life is a deadly serious dilemma that confronts Americans not so often at the point of a gun as at the pharmacy counter.
As many as one in every five Americans are trying to cope with Big Pharma’s morally indefensible pricing schemes by leaving prescriptions unfilled, skipping doses or splitting pills. Such desperate economies, coupled with unwitting failure to take medications properly, are said to contribute to some 125,000 deaths every year and as much as $289 billion in additional health costs.
These staggering statistics are found in a Florida House of Representatives staff report on legislation (HB 19) that incorporates Gov. Ron DeSantis’ proposal to let state agencies and private pharmacies import less expensive drugs from Canada and elsewhere.
The House Health Quality subcommittee approved it 12-2 last week, despite the usual obfuscations from Big Pharma. The bill has other House committees to clear, as well as a Senate that may be less receptive. If it doesn’t get over the finish line, there will be no good excuse.
Drug pricing is a scandal that politicians of both parties are now recognizing. They are informed by stories like that of Alex Raeshawn Smith, a restaurant manager in Minnesota who would have had to pay $1,300 a month, almost half his salary, for the insulin he needed when he aged out of his mother’s health insurance coverage. He tried rationing what he could afford and was found dead of diabetic ketoacidosis, an empty insulin pen nearby. He was barely 26.
The cost of drugs is one of the reasons why Americans spend more on health care — with less to show for it — than almost anywhere else.
Though it’s not the most outrageously priced lifesaving drug, insulin is one of the most common and has become Exhibit A in the national outcry. The doctors who discovered insulin sold their patent to the University of Toronto for only $1, intending it as a gift to humanity. Between 2009 and 2017, the cost of a single vial of Humalog rose from $92.70 to $274.70. It cost only $21 when marketed as the first short-acting insulin in 1996. Feeling political pressure, Eli Lilly & Co., the manufacturer, is now offering the same drug as a generic at half price. But that’s still $45 more than it cost just 10 years ago.
When Nevada enacted a law to make insulin makers disclose more price increase details, the industry hired 70 lobbyists to fight the bill. In Tallahassee, at least 63 lobbyists are registered for the trade group and its constituent companies.
The DeSantis proposal, as filed by Rep. Tom Leek, R-Ormond Beach, would need approval from Washington to take effect. That’s a long shot. The Department of Health and Human Services has the power to waive the federal law that essentially allows only manufacturers to import drugs, but it has turned down every state and local request.
Florida should add to the pressure. Sometimes it works. The pharmaceutical industry put a lid on price increases while President Bill Clinton’s health reform was under debate in 1993.
Though the governor said he has President Donald Trump’s support for Florida to import from Canada, the White House was noncommittal. DeSantis needs to keep the pressure on Trump, too.
The federal government historically has parroted Big Pharma’s propaganda about foreign drugs not being safe. Such cases are infrequent. In fact, as the New York Times reported, 25 percent of drugs labeled American are made elsewhere in plants inspected by the Food and Drug Administration, as well as 80 percent of the active ingredients used in American factories.
The probability that Canadian imports would help Floridians cope raises a fundamental question. Why does the same drug cost less in Canada — and almost everywhere else — than in the United States? It’s because other countries regulate the price of drugs through one mechanism or another. Some stipulate that the price of a drug decline as it ages. Here, it goes just the other way.
The medical industry is immune to the normal effects of competition. For one thing, a critical drug probably has only one, or at most three, suppliers. And when one of them raises a price, the others inevitably do. People who need the drug have no choice.
It’s for similar reasons that the Legislature should not repeal Florida’s certificate of need law. To allow uncontrolled expansion of hospitals and clinics would mean only more MRI machines and other expensive technology to be charged to the same number of patients, swiftly raising costs to the taxpayers as well.
The United States must face the necessity of drug price controls. Medicines on which people’s lives and health depend need to be regulated no less than the prices of two other essential commodities, electricity and natural gas. Utilities account to the states for their investments and expenses, and are awarded a reasonable rate of return. Big Pharma, on the other hand, accounts to no one but its stockholders, and only in ways that don’t tell whether prices fairly reflect costs.
Congress sought to help with the so-called Orphan Drugs program, which Ronald Reagan signed into law. It gives benefits — including extended patent protection for drugs that might not be otherwise profitable because fewer than 200,000 people would need them. Here’s what has happened with that: Manufacturers have found so many ways to relabel them for other purposes that such best-selling drugs as Crestor, Abilify and Humira have enjoyed “orphan” protection.
In one breathtaking stunt, Allergan sold patent rights for its popular and pricey eyedrop Restasis to the Saint Regis Mohawk Tribe. A federal judge accused it of trying to “rent the tribe’s sovereign immunity” to avoid having patents repealed for having been granted in error. The case is on appeal to the Supreme Court.
No matter the reform, Big Pharma will fight it. Its allies at the U.S. Chamber of Commerce have flooded the internet with propaganda against a U.S. government proposal called the International Pricing Index Model. In test markets not yet announced, Medicare would set price ceilings based loosely on those in Canada and some other nations, and allow drug vendors to compete within those limits. It would apply only to drugs dispensed to Medicare Part B patients in doctors’ offices and hospital outpatient departments, which have faced price increases averaging 9.8 percent a year.
The Chamber claims that this “would import alarming policies from foreign governments with socialized health care systems … block access to life-saving drugs for America’s seniors, inhibit the research and development necessary to discover new treatments, and threaten our nation’s freemarket health care system, currently one of the best of the world.”
That is, of course, Big Pharma’s hysterical, nonsensical and shopworn mantra against anything that might eat into its profits. In this case, the fear is that what might work for Medicare would work for everyone. In that happy event, people would no longer have to die for lack of medicines they can’t afford.
Editorials are the opinion of the Sun Sentinel Editorial Board and written by one of its members or a designee. The Editorial Board consists of Editorial Page Editor Rosemary O'Hara, Sergio Bustos and Editor-in-Chief Julie Anderson.