This is regarding the drug-price article in your paper on Nov. 20.
Although pharmaceutical companies are easy targets to bash because of price increases, various issues and policies that follow are significant contributors to the increases.
▪ Difficult diseases are being targeted (cancer, Alzheimer’s, Parkinsons, dementia).
▪ Patent protection limits. Protection starts after a drug is discovered. However, the drug has to be approved by FDA before it can be sold. The amount of time a drug can be sold before losing market exclusivity is significantly less than patent protection.
▪ FDA. The scope and cost of drug testing has increased dramatically, resulting in more time required for approval.
▪ Competition. The FDA is slow in approving multiple drugs in a therapeutic category. Faster approval of other drugs would result in greater competition and lower prices.
▪ Medicaid drug rebate payments were increased from 15 percent to 23 percent under Obamacare. An unintended consequence was higher price increases to recoup revenue losses. Additionally, other government customers get generous rebates and discounts.
▪ Federal prosecution. The huge settlements and loss of revenue have resulted in price increases. It is difficult to believe that all of the companies that have been prosecuted are wrong.
▪ Higher healthcare plan co-pays result in patients having to pay more.
▪ Foreign country price controls. The U.S. needs to influence other countries to deregulate drug pricing.
Hilton Head Island