Drug Costs Are Spiking and It's Not Clear Why

[Jesus Malverde]

Drug costs are rising, but in the opaque world of health care pricing, figuring out what's driving the increase has become difficult—if not impossible.

Nonetheless, pharmacists want Congress to try. Vexed by triple- or quadruple-digit percent increases in drug costs, the National Community Pharmacists Association is asking lawmakers to hold a hearing to find out why.

The problem, the group says, is that pharmacists are getting gouged. Pharmacists trying to get their hands on generic drugs such as Pravastatin, a drug for patients with high cholesterol, or the anitbiotic Doxycycline faced price spikes upwards of 1,000 percent in 2013, according to a survey by the group.

Some 77 percent of pharmacists surveyed by the association said in the last six months of 2013 they experienced 26 or more instances of a large upswing in the acquisition price of a generic drug.

An additional 84 percent said the price fluctuations impeded their ability to provide care and remain in business, as some community pharmacies could not fill prescriptions that would result in losses and some patients declined medication that would have emptied their wallets.

http://www.nationaljournal.com/health-care/drug-costs-are-spiking-and-it-s-not-clear-why-20140131

[Fumesucker]

1. Quantum entanglement

Spooky action at a distance.

[NRaleighLiberal]

2. Let's look at top tier Pharma salaries, the numbers of VPs,

so many that are so far removed from doing actual value added work (except endless phone calls, meetings, and travel). Stock Options, bonuses, etc etc

it's not clear why? It's so obvious it's laughable!

[hadrons]

5. Hey, those commercials running 24/7 aren't free ....

please, a little sympathy for Mitt's buddies

[Igel]

17. They're generics.

Not usually made by top-tier drug companies. Not advertised.

It would help if the danged media wouldn't capitalize generics. The generic names are just chemical names (common nouns), not brand names (proper nouns). One is usually cheap. The other usually expensive.

You may want to capitalize Viagra, but you don't capitalize pravastatin. Otherwise we're in the position of having to capitalize "carbon dioxide" and "methane."

[Blue Owl]

3. A prophet would say profit

Big, greedy, CEO-style profit...

[MindMover]

4. Because they can ...

[rhett o rick]

26. .

[ronnie624]

44. Exactly. What other reason could there be?

The sole purpose of a corporation, is to maximize its profits. The pharmaceutical industry, simply wants to maximize even further, those profits that will result from sales increases from compulsory health care insurance.

[Ichingcarpenter]

6. Pharmaceuticals Rank as Most Profitable all Industry

That's more than banks.... and we don't know why???.........LOL



http://www.citizen.org/documents/fortune500_2002erport.PDF

[LuvNewcastle]

8. More than banks? That's insane that an industry makes more profit than an industry

that gets free money loaned to it by the government.

[Ichingcarpenter]

12. Profit not capital

the banks make more money but not as much profit.

[LuvNewcastle]

15. And Pharma is always making the excuse that they have to

charge so much because of how much they invest in research. The amount for research is far more than offset by the profits. Besides, a lot of that research money, I'm sure, comes in grants from the government. The government could negotiate the price for those drugs like other countries do and Pharma would still come out way ahead! Corporate America thinks it isn't worth being in business if they can't make astronomical profits. It's disgusting how much they make.

[LuvNewcastle]

7. I've noticed.

My Part D policy pays for all but one of my meds, which is a generic that I've had filled twice. The first time I filled it, it was $24. Last month it was $34. At that rate, it'll be $45 this month, and I certainly hope it isn't.

I know a lot of people have it much worse, but it really shouldn't have gone up at all. It's just a muscle relaxer that's been around forever. Really, there's no reason why my policy doesn't pay for it in the first place. That company only has 2 muscle relaxers on their formulary, and I took those drugs a long time ago and they didn't work for me at all. Those companies shouldn't have formularies, anyway. It's bullshit. If my doctor says I need it, they should pay for it. End of discussion.

[2pooped2pop]

9. just greed, i imagine. n/t

[Igel]

20. Some greed.

To be sure. It happens.

Some is recouping costs from when other drugs or dosages have cheaper prices by contract and negotiation. You set the overall drug schedule to reach a certain profit point, which is so many % above the break-even point. One price goes down, some other price goes up.

A lot of generics originate overseas, where they're more cheaply made. If we make them in the US, they cost more and then competition from overseas undercuts the American company. So if the wholesaler here doesn't order the right amount of the right dosage there can be a supply crunch here; or if there's a sudden demand from another buyer there can be increased demand that affects the US market.

Demand can also increase in the domestic market. If a major insurance company suddenly pushes for generics to be used where the brand-name was okay a month or two before, well, it's not like the insurance company coordinates with the importer. Once couldn't get the same company's generic artificial thyroid hormone at my usual pharmacy. The other pharmacy had started to carry that one as well and there was a sudden shortage of that one company's version. They still had it at a higher dosage, so my doctor revised the prescription and I took half of a larger dose instead of the usual dose. (I'm euthyroid now!)

In a few cases it's been reported that a drug had imports blocked briefly because the company had problems with a second drug. Or it was time for a routine safety inspection.

The upper limit for what a generic can cost is usually near the brand-name price.

[JaneyVee]

10. CEOs need a need private jet. Time for a raise.

[TexasProgresive]

11. Because "they" can raise them to whatever.

I don't know if it is still true but cars in Canada were significantly cheaper than in the US. Why? Because our neighbors to the north refuse to pay that much and so the dealers have to cut their profit margin a bit.

Same with drugs.

[KG]

13. a cynic might think it has something to do with compulsory enrollment in private health care system.

[LuvNewcastle]

16. You cynics are just so....cynical!

[MisterP]

29. If a mandate was the solution, we could try that to solve homelessness by mandating everyone to buy

a house

we should've voted for the guy who said that

[geckosfeet]

31. Not so much a cynic as profiteer. The big pharma lobby scores again.

[grahamhgreen]

14. Because we don't negotiate for bulk purchases like every other country. NT

[BrotherIvan]

18. Because the ACA does not have safeguards in place for price gouging

From prescriptions to hospitals to doctors, the prices keep going up, costing individuals and the government billions.

[riderinthestorm]

22. And now we're all mandated to purchase those policies

With no price controls and a public that MUST be on these health insurance plans, its almost as if greedy Big Pharma decided it had carte blanche to grab even more of our money.

Insert the line "nobody could have seen this coming" here.

Oh wait....

[BrotherIvan]

33. And nobody spoke up

Except those far left firebagger ODS haters. Oh wait..

[riderinthestorm]

40. You never loved Obama

You racist, Rand Paul libertarian!

[LiberalEsto]

19. To make things worse, a lot of insured folks now have very high deductibles

Where on earth are they going to get the money up-front to pay for prescriptions that cost three times and much as they did last year? This happened to us.

[BrotherIvan]

34. Yup

And people will be even more surprised to find what it doesn't cover. My silver plan not only has a high deductible but the network is small and if i go out of network or have an emergency out of state the company has told me I'm basically screwed. The guy on the phone sort of admitted these plans were not what people were hoping. The deductibles are so high many people will still not be able to get care.

I know that i will be told to just cough up more cash to get a better plan but i have no faith there aren't serious loopholes and i don't use my insurance at all really. And i hate paying for more junk to these predatory companies.

I'm hoping someday California gets single poster because i would be more than happy to pay premiums for something i can actually use.

[socialist_n_TN]

21. Because of capitalism?.....

That would be my guess.

[riderinthestorm]

23. Or Big Pharma now has a "captive audience". Literally. Captured by law.

And stuck within this system without any way to control prices, Big Pharma can do whatever the hell it wants with drug prices. Because we're all mandated to pay now...

[socialist_n_TN]

32. Why that's capitalism.......

Marx wrote about monopolies and cartels over a century ago. It's a natural development of capitalism. And in a bourgeois "democracy" it's government's job to facilitate the making of profit by any means necessary. Including mandates.

[DeSwiss]

24. K&R

[cvoogt]

25. Umm

Greed, a.ka. capitalism. Seems pretty obvious ..

[cadaverdog]

27. Possibly they are raising prices in anticipation of

the passage of the TPP. Just a thought.

[okaawhatever]

35. No, the TPP enforces patents for drugs. too many countries allow generics or don't recognize patents

and that's one of the reasons Americans pay more for their drugs. While I think a lot of reforms made in pharma, and the profit they make is ridiculous, I'm all for holding other countries accountable for intellectual property rights. That's a big chunk of TPP. China cost us billions by using our intellectual property without paying for it.

[abelenkpe]

28. y'know we could nationalize that entire industry

and take the whole profit motive out of providing needed care for our citizens. I'm surprised that anyone would think rising prices is due to anything other than blatant greed. There should be no profit motive in health care, retirement or education. Should probably add energy to that list.

[Enthusiast]

41. I'm with you.

We should add energy and water to that list.

[kristopher]

30. It could be increased demand because of the ACA

If demand has spiked it will take the manufacturers a little while to catch up. The immediate effect would be a corresponding spike in prices.

If anyone can find the number of prescriptions written by month ever the past 24 months for the meds in question it should tell us if that is the problem.

It would be the first thing to rule out, in any case.

[okaawhatever]

38. I think consolidation in that industry is a big part of it. Several times we've had shortages of

drugs that were attributed to consolidation in the industry. I think it was Obama who passed an order stating that if a drug company knew it would be running low on a drug they must inform the government. There were a few other provisions as well. I haven't read anything about it lately, but I know in the past the consolidation issue has raised quite a bit of controversy.

[Warpy]

36. They've been creating artificial shortages, too

This is monopolistic behavior and there is nothing we can do about it since most manufacturing has now been offshored.

[Spitfire of ATJ]

37. One word: Audit

[nenagh]

39. My son sent our family a link to This American Life episode 392, Someone Else's Money.

Speaks about enormous prices for brand name drugs ..vs generics.. Here in Ontario, drug prices are regulated..

Also talks about the use of coupons in the USA.. For the patient..which reduces the copay for certain drugs..and no one knows the true cost of the brand name drug..

Worth a listen... Sorry I can't link..also speaks about medical codes.. and how each insurance company has a different set of codes often with different pyrameters.

Sunlight may be a good idea...

[Enthusiast]

42. I wish we could expand Ontario

down into Ohio.

[fizzgig]

43. here's the link

http://www.thisamericanlife.org/radio-archives/episode/392/Someone-Elses-Money

i'll have to give this a listen