Drug Price Spikes
Various prescription drugs move along the automated pharmacy assembly line at Medco Health Solutions in Willingboro, N.J. Patients and politicians have been voicing outrage over skyrocketing drug prices in recent months, moving U.S. Sen. Sherrod Brown and other legislators to push for reforms.
(Matt Rourke)
CLEVELAND, Ohio -- U.S. Sen. Sherrod Brown stood in the corner of a Cleveland supermarket Tuesday and launched a broadside on the pharmaceutical industry.
He argued prices for prescription drugs are out of control, and that the businesses responsible are offering scant justification for sudden increases.
"They are not developing new cures, they are not investing, they are not often even doing the clinic trials," he said of companies behind recent price hikes for generic drugs. "Instead of making something new and innovative, they buy the rights to existing drugs, they lay off workers, and they hike prices by sometimes 800 percent, 900 percent, 1000 percent."
Brown made the appearance to push for a bill he is co-sponsoring -- The Medicare Prescription Drug Savings and Choice Act -- to lower drug costs by giving Medicare the power to negotiate prices on behalf of seniors.
"We know Medicare prices help set the rate for the private market, so if we can bring the price down for Medicare overall...we will be able to stabilize drug prices" for consumers throughout the market, he said.
The press conference followed a Plain Dealer story last week that reported Cleveland's largest hospital systems are facing millions of dollars in added costs due to skyrocketing drug prices. University Hospitals expects to pay at least $3.6 million more in pharmacy costs, while the Cleveland Clinic is contending with more than $11 million in added expenses. Most of the increases reported by the hospitals were for generic drugs whose prices spiked after they were sold to new owners.
The elevated costs are often passed on to patients, particularly those with high deductible insurance plans or gaps in prescription drug coverage.
The pharmaceutical industry has opposed efforts to expand federal powers to control prices in recent years, arguing such interference would stifle innovation and prevent drug companies from discovering new cures. On the bill being pushed by Brown, a spokeswoman for one industry trade group argued it would undermine savings already being achieved by private plans that represent millions of Medicare beneficiaries and are currently allowed to negotiate prices.
"Medicare Part D is a successful program that keeps costs low for both beneficiaries and taxpayers through competition and negotiation," said Allyson Funk, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, a leading trade group. "Harmful proposals to fundamentally alter the structure of the program could jeopardize seniors' and people living with disabilities' access to affordable prescription drug coverage, driving up premiums, reducing choice and restricting coverage."
Brown said opposition from drug companies blocked the legislation previously, when he and others tried to get it included in the Affordable Care Act. He said he is still trying to find Republican co-sponsors and generate broader support for the updated version of the bill.
"We hope this builds enough pressure on members of Congress to do the right thing here," he said. "We assume drug companies are quietly working Congress. They have more lobbyists than anybody but Wall Street. It's an ongoing battle."
Brown's bill seeks to put Medicare on the same footing as the Veterans Administration, which has used its authority to negotiate prices to cut the cost of some brand-name drugs by as much as 50 percent.
Seniors would be able to save money by enrolling in a prescription drug plan run by Medicare, whose plan would be available nationwide and charge the same premium for everyone.
Brown hosted the press conference at a pharmacy in Dave's Supermarket on Payne Avenue. He was accompanied by Charmaine Szanyi-Hrusch, a 72-year-old retired school teacher who has struggled to afford prescription drugs.
A sufferer of chronic lung disease known as COPD, she said she has had to pay $1,000 a month at a local pharmacy for drugs that would have been free had she gotten them at a hospital.
During the press conference, she also spoke of friends who have struggled to afford sudden price increases, reading aloud about their travails from notes she had jotted on a sheet of yellow lined paper.
"Medicare patients are the most vulnerable," Szanyi-Hrusch said. "They use the most drugs, they're older, they're sicker and they are on pensions and social security, so they don't have the resources to pay for the drugs."
Also speaking at the event was Ernest Boyd, executive director of the Ohio Pharmacists Association, who noted that retail pharmacies are also struggling with the price hikes. He said pharmacies are often forced to absorb the increases because insurers refuse to cover them for some drugs. That makes it harder for many small pharmacies to stay in business.
"We need to look at all the factors of drug pricing, everything from what it costs to make the drug to what is a reasonable profit," Boyd said. "We need to make sure patients have access to pharmacies."