Should Prescription Drugs Cost be Controlled in the US?
Posted on: Thursday, July 16, 2015

The public opinion in the US is getting increasingly negative for the high prices of prescription drugs. A course of treatment for some hepatitis drugs could cost $95,000; multiple cancer drugs cost about $150,000 per course, while a couple of drugs for the rare disease cystic fibrosis could cost more than $300,000 for a single course of treatment. The US drug prices are the highest in the World. The same drugs by the same companies cost a fraction of their US prices in other countries that practice various forms of drug price control. The drug industry has long justified the high prices in the name of protecting innovation, the high cost of developing new treatments, and savings imparted by these new drugs compared to standard of care. But these arguments are increasing being challenged. There are several market research programs in play to investigate the true savings in the overall cost of treatment with the use of these new expensive drugs. Last year, such studies were used to reduce the cost of certain hepatitis drugs by almost 50%. In a Wall Street Journal survey, about 87% of US public want the government to negotiate drug prices covered by Medicare. Four states are considering the “drug cost transparency” laws that would require pharma companies to publicly disclose financial information regarding their drugs such as the cost of develop and market, the government grants received to support a given development program, and net profits. Several other states are discussing similar laws, and eventually if the state laws are successful, a similar federal law may be proposed. There is precedence; the Sunshine Act similarly started with state laws followed by the federal law. There are also provisions to force companies to sell drugs at the same prices they are sold in other countries. These laws aim to give the government reasons to force some form of price control in the US. Of course, the industry is fighting hard to avoid such laws but they need to manage the public perception better. Drugs save life; and need to generate profits to assure further investment. However, there needs to be a balance between fair profits (seems like an oxymoron) and what is clearly price gauging.
 

Expert Opinion: Mukesh Kumar
VP, RA, Amarex Clinical Research