My dad was one of the first generation of type 1 diabetics to survive because insulin was available. We worried about him as over the years he developed one after another of the complications of this potentially deadly disease: blindness, amputations, heart disease and more. But we never worried about his not being able to afford this crucial drug, taken by injection twice a day. He died in 1978. In 1999, one vial of insulin cost $21. By 2019, the cost had risen to $332, according to the Mayo Clinic.
By my calculations, the cost of his life-saving insulin would today be more than a quarter of a million dollars. Insulin here costs ten times more than in other developed nations. Just a handful of drug companies have controlled the market, and nefariously extended their patents to protect their profits. Both Republicans and Democrats have promised relief on all prescription drug costs. No one has delivered on those promises.
Two months ago, the House of Representatives passed a bill to cap out-of-pocket insulin costs at $35 a month. All Democrats and, pathetically, just a dozen Republicans supported the Affordable Insulin Now Act, which basically has the government sharing costs for Medicare beneficiaries. It does nothing for other insulin-dependent individuals, and it does nothing for all of the other prescription drugs through which big pharma is ripping off the American people.
The U.S. spends more than 18 percent of the gross domestic product (GDP), on national health expenditures, of which $384 billion was spent on prescription drugs. In some years, prescription drug spending growth has far exceeded the growth in other medical spending. Our per-person spending annually is the highest in the world.
Drug patents can last for 20 years, but insidiously the drug companies can create me-too drugs, not generics but patent-protected variations of their other drug products. It is shocking to learn that a pharmaceutical company with a brand-name drug may even pay generic manufacturers not to enter its market! Even when a generic does become available, the FDA can give the brand manufacturer exclusive rights to marketing a drug. We have all learned how Purdue Pharma incentivized doctors to prescribe particular drugs. Pharmacy managers and HMO’s cut price deals with pharmaceutical firms that keep patients from moving to generics. (The deals involve discounts for bulk purchases, with higher discounts for higher-priced drugs.) Few in Congress, many of whom receive healthy campaign donations from big pharma, have moved to regulate or eliminate these practices.
They even lack the backbone to allow Medicare to negotiate for lower prices with drug manufacturers, a measure supported by the public overwhelmingly (87 percent of Democrats and 85 percent of Republicans.)
The drug companies argue that charging higher prices facilitate more research and development. Hogwash! According to a recent Harvard Business Review article, “2003 through 2012, Pfizer funneled an amount equal to 71% of its profits into (stock) buybacks.” And, since executive pay depends largely on a company’s valuation, users of insulin and other prescription drugs are paying exorbitant prices to pad the wallets of big pharma executives. It’s enough to make you sick!
The fate of the Affordable Insulin Now Act in the Senate is not known. Look to the Republicans for an answer to that. I’m all for its passage. But it’s just Step One, and a tiny step for that. Until the political climate changes, I’m not sanguine about Washington moving on the egregious price gouging by the pharmaceutical industry. Until Congressional leaders show more courage and less hyper-partisanship, perhaps the only answers for average folk in the country are to get on a NARC bus to Canada where drug prices are more affordable. Just make sure to have your proof of Covid vaccination with you or you won’t be allowed to cross the border.
I welcome your feedback in the comments section. To be alerted when a new blog is posted, click on “Follow’ on the home page on marjoriearonsbarron.com.