Drug pricing transparency is way overdue
Drugmakers spend billions selling prescription drugs on TV to the public, sometimes turning a new drug into a blockbuster. You probably know from TV ads that pro golfer Phil Mickelson treats his psoriatic arthritis with Enbrel and that Cialis, a drug for erectile dysfunction, “helps you be ready anytime the moment is right.”
What you don’t know from the commercials is how much these drugs cost. But that could soon change.
On Monday, Health and Human Services Secretary Alex Azar proposed requiring drugmakers to disclose drugs’ list prices in their TV spots. The transparency is as welcome as it is overdue.
Drugmakers have been pitching prescription drugs to consumers for decades with visuals of people leading better, more fulfilling lives all because they’re taking a prescription drug.
It’s easy to see why they haven’t bragged about the prices. The 10 most commonly advertised drugs sport monthly prices ranging from $503 for Eliquis, used to prevent strokes, to more than $11,000 for Cosentyx, to treat plaque psoriasis and psoriatic arthritis. Now that’s information worth having.
Hours before Azar’s announcement, the Pharmaceutical Research and Manufacturers of America made its first countermove, announcing an alternate plan to publicize prices. It would disclose prices on a new website in the spring. PhRMA denounced the government’s plan as “confusing, misleading” and not “what patients want or need.”
Azar’s response? “Placing information on a website is not the same as putting it right in an ad.” We agree.
If companies want to advertise the benefits of their drugs, they ought to reveal prices at the same time and place.
In fact, that list price is a meaningful number. According to HHS, nearly half of privately insured Americans have policies with high deductibles and pay the list price for prescriptions until the deductibles are met. Ditto for those with Part D Medicare drug plans.
Once deductibles are met, patients are spending the insurance company’s money on drugs, one reason many people don’t pay attention to absurd costs. Perhaps hitting them over the head with prices on TV will at least make them aware of what’s driving health care costs to astronomical levels.
One thing price transparency won’t do is bring down prescription prices — one of the administration’s objectives.
Last year, President Donald Trump promised to do so by preventing the big pharmaceutical companies from “getting away with murder.” That’s a worthy goal, but one better handled by giving big buyers more leverage to negotiate prices with drug companies, starting with the federal government’s purchase of Medicare drugs.
Until that happens, the public needs a taste of reality. And drugmakers deserve whatever blowback comes when the public hears in a TV commercial that a drug, Humira, for example, costs more than $5,800 a month.