The Drug Trade

Fri, 2017/09/15 - 1:14pm | Your editor
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Brazilian prexy Michel Temer has been charged with obstruction of justice and racketeering over the giant meetpacker JBS tapes of conversations with him, but proceedings will require that the lower house of the Brasilia congress life his immunity. Since so many Brazilian pols themselves took bribes they may protect Temer to cover their own misdeeds. It is a national flaw among pols there.

 

Today's focus is on pharmaceuticals(AKA The Drug Trade)  so we begin with a development in the State of Maryland, MD. There the attorney-general is not wasting his time claiming that drug firms are peddling dope by how they present pain-killers to doctors (also MD's). Instead, the state is suing in a US Court in Baltimore to allow its aggressive injunction to identify and stop price hikes by drug-makers, particularly for older drugs where there is not much competition, like a single generic version. While several states are pushing for drug price controls, MD's is the most far-reaching.

Johns Hopkins University will find the price boosts when informed by drug stores, insurance companies, and Marylanders—because they are usually not told about them by the pharmaceutical company. There have been several egregious examples of price gauging, like the 6-fold price hike for the Epipen by Mylan or the 700%+ increase in the price of heart med Isuprel by Valeant Pharma 2 years ago.

Other generics producers argue that a state-by-state blockage of price rises risk creating disorder and that the necessary policy should be developed at the federal level, which is why the case is in court now. The focus of the MD statute being sued about is older generics drugs. It excludes new copycat drugs which generics makers market at much lower prices once they are off-patent, protected by the Hatch-Waxman act against more competition from other generics makers for 6 months. About 90% of US prescriptions are written for generics, but they only account for barely more than a quarter of the very high US level of spending on drugs.

The problem is that after the exclusive period ends, the free-for-all among generics makers can cause a huge price drop, so generic-makers cut their list of offerings. Because of pharmaceutical benefits programs and pharmacists working to cut the costs of drugs (for which they are paid!) generics are losing a lot of their former profits.

And if there are only a couple of versions of the drug on the market—or only one—price gauging is prossble. The US General Accounting Office last year said over 300 generics drug prices had doubled or more since 2010. Initially MD sought to limit price increases to merely 100% but after that Attorney-general Bruian Frosh removed that loophole, fearing it would encourage lots of generics companies doubleing the price.

Other states are also working on the price question, like Nevada, which wants to limit the price of diabetes medications. Ohio next year will have a ballot vote on whether drugmakers must give the state insurance body the same discounts as are offered to the Veterans Administration, which is a federal body. One of my daughters-in-law works as a senior researcher for the VA in Cleveland but did not contribute on this healthcare issue yet.

California voters last year defeated a drug pricing ballot initiative also using the VA discounts, but it now has been approved by both houses of the state legislature and awaits a ruling by Gov. Jerry Brown

 

More pharmaceutical news follows form Britain, Canada, Denmark, Finland, France, Germany, Holland, Hong Kong, Ireland, Israel, Italy, Mexico, South Africa, Sweden, Switzerland, and the USA.

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