Health Care Reform Forum
In the meantime, our Health Care Reform Forum continues its series of letters to the editors on Prescription Drug Pricing.
Pharmaceutical companies continue to be the most profitable segment of our economy. The companies claim that high prices fund necessary research and development (R&D). However, 9 of the 10 top pharmaceutical companies spend much more on marketing and sales, totaling $3 billion annually to consumers and $24 billion to healthcare providers, than on R&D. The U.S. is one of only two countries in the world to permit the advertising of drugs.
The drug companies have other strategies to increase prices to prescription drugs. Most new drugs are patented, giving the manufacturer monopolistic marketing and price protection for up to 20 years. But when the patent is due to expire, companies often make a minor change in the formula, and get a new patent to maintain profits
Another strategy is to keep generic versions of the drugs off the market, sometimes by paying generic manufacturers to postpone the introduction of cheaper versions.
Another strategy is to buy the rights to an old, cheap, “niche market” drug with only one supplier, and then hike the price by several hundred percent. Patients who need that drug are hostage to that inflated price.
They also encourage the use of prescription drugs for purposes other than that for which they have been tested and approved by the FDA.
By using these monopolistic strategies, pharmaceutical companies have proven that they cannot moderate their own pricing practices. We need to tell our legislators to regulate the costs of these necessary and often life-saving medications like is done in nearly every other country.