Most people realize how Big Pharma’s greedy drug pricing raises our health care costs. Fewer are aware of how greedy drug pricing also raises our taxes.
Currently, 60 “patient” advocacy groups—many clear Pharma fronts—are agitating to stop Medicare Part D health plans from scaling back coverage of “protected-class drugs.” The proposal that has infuriated Pharma would let Medicare plans “exclude from their formularies protected class drugs with price increases that are greater than inflation, as well as certain new drug formulations that are not a significant innovation over the original product,” said Seema Verma, the administrator of the Centers for Medicare and Medicaid Services.
“Patient” groups, quickly assembled by Pharma to protect profits, contend such drugs which CMS might consider not a significant innovation over the original product, are not “therapeutically equivalent” to brand name drugs. They are half right. A protected drug like Invega (used for schizoaffective disorder and schizophrenia) which costs around $1,239 for 30 tablets—$14, 868 a year—is certainly not equivalent to a cheaper drug. And we, the taxpayers, pay the freight.
Other “protected” drug classes include anticonvulsants, antidepressants, antipsychotics, antiretrovirals, and immunosuppressants; most, if not all, of the drugs in the classes have cheaper alternatives. Currently, the classes account for as much as 33 percent of total outpatient drug spending under Part D of Medicare.
In 2014, the Obama administration sought the same scaling back of Pharma gouging Medicare but was defeated by drug industry operatives like the National Alliance on Mental Illness (NAMI) which received $23 million in just two years from drug makers and does Pharma bidding.
The proposal “undermines a key protection for some of the sickest, most vulnerable Medic beneficiaries,” sniffled NAMI lobbyist Andrew Sperling, one of many voices that defeated the proposal.
To fight the current, similar proposal Pharma is using the same tear-jerking tactics with high budget PR campaigns that aggressively give the phone numbers of lawmakers. Ending Pharma’s high “protected” drug Medicare prices represents European style “socialized” medicine says one hysterical ad—rationing is just around the corner! Another ad depicts the birthday party of someone in his 60’s who would die—yes die!—if CMS ends Pharma’s taxpayer-funded profit party.
Disallowing Pharma’s obscenely high prices would “cripple innovation,” says another ad, though the claim that high prices represent “research and development” has been thoroughly debunked. The prices represent what Pharma can get.
The six protected drug classes are not the only example of regulations Pharma has pushed through to be paid on the public dime. In Texas, a Medicaid “decision tree” called the Texas Medical Algorithm Project was instituted that literally requires doctors to prescribe the newest psychiatric drugs. Ka-ching.
If Pharma’s “not equivalent” argument doesn’t work, “patient” groups and medical associations serving Pharma are also whining that ending the profit party by allowing cheaper drugs would be “administratively burdensome” and allow “third parties” to make a treatment decision. One of these arguments must work, right Pharma?
Martha Rosenberg is the author of the award-cited food exposé “Born With a Junk Food Deficiency,” distributed by Random House. A nationally known muckraker, she has lectured at the university and medical school level and appeared on radio and television.
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