Are We Being Played for Suckers?


Why are Americans shouldering the burden of paying for drug innovations?

I am going to do something treacherous in this column. Like a member of a bomb squad approaching a suspicious package, I’m going to tiptoe, ever so slowly and no closer than I have to, into the world of contemporary American politics.

Not because I want to, but only because I have a question that’s going to sound an awful lot like what a particular politician with a penchant for grabbing headlines would ask. Trust me, I am not pushing any ideology here.

I’ll start by stating something everyone reading this already knows. Americans pay the highest prices in the world for prescription drugs.

It won’t surprise you to hear that while the bill for an American with a prescription for Harvoni pays an average of $32,114 a month, the same prescription would cost $22,554 for a person in the United Kingdom, and $16,861 in Switzerland. Canada has a law that breakthrough new drugs can’t be priced at more than the median price internationally. Meanwhile, Americans can pay as much as 16 times more than people in other countries for the same drugs.

Ho hum. Nothing we haven’t heard before.

Next I’ll go on to the answer we’ve all been given: Breakthrough medications are expensive. A study by the Tufts Center for the Study of Drug Development (an organization that receives almost a third of its budget from companies involved in drug research) estimates the cost of bringing a new drug to market to be $2.6 billion. Even if you accept that number-which many don’t-and accept that reason as the primary culprit-which more than a few people won’t-that leaves an obvious question that is almost never asked.

Why are Americans expected to subsidize the bulk of the world’s drug research?

Where is it written that an auto worker building Lincolns in Detroit is responsible for an “innovation tax” to be levied on his prescription that his colleague making Jaguars in Liverpool is not?

Someone is playing us for suckers. This has to be the worst trade deal in economic history. And yes, I know who that sounds like.

In all seriousness though, do you really think that if we did something to put a stop to the price gouging  Americans are subjected to, that drug companies would just put a stop to their research, let their patents expire, and say “Oh well, we had a good run”?

Ask yourself which is more likely: that, or that companies would put more pressure on other developed nations to chip in to subsidize the level of profit and/or research to which these multinational corporations have become accustomed.

I’m sure you wouldn’t have to look very far among the ranks of our leaders to find someone who considers himself to be a good negotiator. Yet Medicare is still prohibited by law from even attempting to negotiate lower prices from drug manufacturers. So we get a bad deal that no one seems to be making a move towards changing, aside from a few angry Tweets. There is no reason to let this continue.

It’s time for this country to stand up for itself. I cannot imagine another situation where such an imbalance between the price we pay for a product versus what the rest of the world pays would be accepted. We have no special obligation to fund the activities of drug companies. Everyone who benefits from drug research should contribute equally to its costs.

Nothing I’ve said in that last paragraph is nearly as controversial as any of the political headlines you’ll see in today’s paper. Which is a big reason, I fear, as to why nothing on this issue will get done.

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