bucket of money, sticker shock

Wonder what’s behind high drug prices? Have you ever heard the crude expression:

“Money talks and bulls**t walks.”

We apologize for the obscenity. But nowhere is that crude phrase clearer than on Capitol Hill.

Lobbying Is About the Money, Honey:

The pharmaceutical industry has a powerful lobby. Regardless of who is in power, drug makers sway votes with their financial clout. Lawmakers on both sides of the aisle accept large contributions from drug lobbyists. That may be why Americans pay more for prescription drugs than any other nation in the world.

Over the past few months pharmaceutical lobbying has intensified. With the Senate now considering repeal of the Affordable Care Act and President Trump accusing drug manufacturers of “getting away with murder” on drug pricing, the industry has gone into overdrive. There are a lot of industry executives concerned about future profits. They want to protect high drug prices and are willing to spend money to do so.

Spending More to Sway Congressional Votes:

According to Kaiser Health News, eight companies more than doubled their budgets for lobbying during the first quarter of the year. Altogether, pharmaceutical trade groups (including the largest, PhRMA) and 38 individual firms spent more than $50 million between the beginning of January and the end of March.

Some of the eight companies that increased their lobbying the most are generic manufacturers such as Teva and Mylan. Mylan, of course, gained notoriety when it took the price of the emergency allergy medicine EpiPen from $100 to $600.

Teva, the largest generic drug maker in the world, has been accused of fixing prices. So have a number of other generic drug companies, including Mylan.

The Attorneys General Go After Generic Drug Companies

At last count, 40 attorneys general have joined the lawsuit against these generic drug makers and Aurobindo Pharma USA Inc, Citron Pharma LLS, Heritage Pharmaceuticas Inc and Mayne Pharma (USA) Inc.

The Illinois Attorney General, Lisa Madigan, stated:

“Our lawsuit alleges drug companies engaged in illegal behavior to increase the cost of drugs. This unlawful conduct is responsible for the soaring cost of vital and potentially lifesaving prescription drugs.”

Want to read more about this? Here is a link to the Kaiser Health News Story:

“Alleged Scheme to Fix Generic Drug Prices Started at Dinners and ‘Girls Nights Out'”

High Drug Prices for Brand Names Under Scrutiny Too:

It’s not just the high drug prices of generics that are under scrutiny. Manufacturers of high-priced brand-name medications for rare conditions have also been criticized. Makers of “orphan drugs” are entitled to tax breaks and federal grants. They still charge huge amounts for their medicines.

Orphan drug legislation was originally designed to encourage the development of drugs that would otherwise have too small a market to be profitable. But manufacturers have found ways to utilize the Orphan Drug Act to bring forward medicines with huge price tags.

One recent approval, Spinraza to treat spinal muscular atrophy, is expected to cost $750,000 for the initial year of treatment. Enbrel, Humira and Remicade, drugs for rheumatoid arthritis, ankylosing spondylitis and some types of psoriasis, are also considered orphan drugs and are also pricey. They bring in billions to their manufacturers each year.

Celgene’s orphan cancer drug Revlimid has annual sales of over $4 billion. It costs a patient or his insurance company more than $100,000 a year. Rather than lower the price, the company has beefed up its lobbying efforts. According to Kaiser Health News, Celgene tripled its lobbying budget in the first quarter of 2017 to more than $1 million.

With so much money at stake, politicians may talk about the high drug prices, but doing something about it is another story.

What Can Patients Do?

If you would like to learn more about the scandals swirling around the high cost of orphan drugs as well as the generic drug scandal, check out our online resource: Saving Money on Medicine. It provides details about the pros and cons of purchasing prescription medications in Canada. There are also tips on how to negotiate with your pharmacist to save on high drug prices.

And please let us know what you think about the recent drug scandals. Here is one comment from Jim B:

“Joe & Teresa,

“This is a great piece!!!! Needs to be on the front page of every newspaper and the cover of every magazine available to the American public. I will share it with everyone I know.

“People are upset about the cost of insurance but know one seems to be looking at the real problem, the cost the insurance companies have to absorb from unscrupulous drug companies and medical service providers.

“This is truly outstanding journalism.
“Thank you,  Jim”

Share your own thoughts in the comment section below.

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  1. Janet
    Greenville NC

    Just an FYI as to the extent of the lobbyist problem, e. g., Amgen has a lobbyist for each of their drugs. Then when politicians do not get reelected, they become lobbyists since they have the “inside” contacts. (Kay Hagen, e.g., “SENATOR KAY HAGAN PROMISED TO TAKE ON SPECIAL INTERESTS, NOW SHE WORKS FOR THEM” –Akin grp).

    Where will it all end? Too bad all Federal employees are not on Medicare and Social Security when they retire, just like the rest of us!!!!

  2. Harold

    Thanks for the great article.

    A very well done article worth the view: http://www.motherjones.com/politics/2016/10/drug-industry-pharmaceutical-lobbyists-medicare-part-d-prices

    My wife recently ordered Symbicort aka Vannair from Canadian Drugs. She paid $201 (further less a first order discount) vs $886 U.S. The us price was after co-pay (medicare)!

    Ya, we got to feed the pigs… One would think if they had a conscience they would be very nauseated.

  3. S

    Yes, the cost of drugs is out of control. However, pharmaceutical companies spend many years and millions of dollars in developing a new drug. The cost of clinical trials is huge.

    In spite of this, the FDA can prevent a new drug from being put on the market for any number of reasons. This same drug can be marketed in Europe and elsewhere. Something needs to be done but what?????????

  4. Elaine L
    Black Mtn., NC

    Everything in this is true except that once the lawmakers are so “used to that MONEY, honey”, how are we ever going to get them to vote against accepting what is really “bribe” money? Who has suggestions for that?

  5. Richard
    North Carolina

    Lobbying should never have been allowed in the first place. I don’t know why it is not illegal to influence our lawmakers with money from corporations. It is time that we abolish lobbying, and give the people a chance to let the lawmakers know their wishes again, influenced only by their vote.

  6. Jim

    If you are following the health care debate in congress you would realize healthcare is not a right. At least that is what some of our congressmen are saying. This is a capitalist country, so if you can’t afford the medication or treatment so be it, the drug companies have a right to a profit.

  7. Jodi
    state of WA

    I recently had to pay over $700.00 to receive an injection of Prolia. This was my portion after Medicare and my supplemental insurance plan had paid their share.
    When I complained to my doctor, she felt that this was “unacceptable”. I was subsequently referred to an Endocronologist who, I was informed, had been charged almost half of what my Primary Care doctor’s clinic had been charged for the same drug. If I had received the injection from this office, I would likely have been charged approximately $200.00. What is going on here?

  8. Raymond F
    Mountlake Terrace, WA

    It’s a crime but both political parties are on the take from Big Pharma and have been so for a long, long time. Money talks and the political parties are listening. Just feel so helpless in having anything done to correct this atrocity.

  9. Madashell

    Your article is spot on! Pharmaceutical manufacturers like to threaten us that research will be reduced if they cut prices, which of course is baloney. They could stop advertising and lobbying and have plenty of money for research and cutting prices.

  10. Mark

    My wife is an organ transplant patient. Our overall healthcare cost are in the range of sinfully obscene. The drug ripoff is just incredible. We could buy a new, nice car every year with what these cost are. I truly hope the fat cats getting disgustingly wealthy off of the suffering of others enjoy this life. It’s a short one.

  11. Susan
    Tidewater, VA

    Do know another reason our drug prices are outrageously high has to do with the fact the United States and New Zealand are the only 2 countries worldwide that allow advertising to the public on TV and in print, which is expensive. Congress had to approve the fact this is allowed. For the time being, we do have the ACA, too bad when that was written medication advertising wasn’t banned in an effort to lower costs. Hopefully when the Senate writes a replacement universal health plan, banning medication advertising is included this time.

  12. alexis jones
    North Carolina

    Wish I could have checked your 5 stars at least 100 times! Thanks for the article. Have asked friend to has personal access to Virginia US Senators to forward your article to them.

  13. Timothy
    Decatur MI

    Well this is a long awaited report.
    I am currently retired and am in the “donut hole”, I entered about 2 months into getting my prescriptions filled, due to high costs. Even with my supplemental drug insurance, I now need to spend the $5000.00 out of pocket before I get some coverage again. In the “donut hole” coverage drops off even with the supplemental insurance that I pay $90.00 per month for. Their coverage also drops until the out of pocket is met. A true scam.
    This system is outrageous for retirees.
    Thank you for your great article.
    Timothy Doyle
    Decatur, Michigan.

  14. Carla

    Thanks for the good post, but I must say, this is the problem with every single issue challenging our country. The Democrat and Republican parties are working for the same people, and it ain’t us. The sheer greed and mendacity of our ruling class is stunning. The word democracy comes from the Greek: demos = people; cracia = rule. It means the People rule. Not the judges, not the corporations, not the elected officials. If we are a free and sovereign people, it’s time to start acting like it. Yours in good health, Carla.

    • Harold

      Amen to Carla!

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