Rising Rx prices front and center in presidential campaign

September 24, 2015

Following public outrage over price increases for two specialty drugs, the frontrunners for the Democratic nomination for president are both pushing plans to lower the costs of prescription drugs.

Following public outrage over price increases for two specialty drugs, the frontrunners for the Democratic nomination for president are both pushing plans to lower the costs of prescription drugs.

Last month, Rodelis Therapeutics acquired the drug cycloserine, which is used to treat multidrug-resistant tuberculosis. Rodelis immediately raised the price of cycloserine from $500 for 30 capsules to $10,800 for that amount.

Senators target pay-for-delay pharma deals

That move was met by accusations of price gouging, and Rodelis agreed to return the drug to Purdue Research Foundation, which oversees the non-profit that manufactures the drug. Purdue will charge $1,050 for 30 capsules of cycloserine.

In an unrelated incident, Turing Pharmaceuticals announced plans to raise the price of pyrimethamine (Daraprim) by more than 4000%. That 62-year-old drug is used to treat toxoplasmosis, a parasitic infection that can be severe in patients with compromised immune systems.

Earlier this year, Turing bought Daraprim for $55 million from Impax Laboratories. Martin Shkreli, Turing’s CEO, told the Washington Post that the drug was unprofitable. “We needed to go to a price where we could turn a profit,” Shkreli told the newspaper.

However, Shkreli subsequently said his company would lower the price of Daraprim to some point that is more affordable.

 

Hillary Rodham Clinton, the Democratic frontrunner for the presidential nomination, called Turing’s price increase an “outrageous” example of price gouging.

"We need to protect hard-working Americans here at home from excessive costs. Too often these drugs cost a fortune,” said Clinton, during a campaign stop in Iowa.

Meanwhile, Democratic presidential candidate Sen. Bernie Sanders (I-Vt.), along with Rep. Elijah E. Cummings (D-Md.) sent a letter to Turing Pharmaceuticals requesting information about the price increase and restrictions in product distribution. Previously, Sanders initiated an investigation into the soaring prices of generics.

“The enormous, overnight price increase for Daraprim is just the latest in a long list of skyrocketing price increases for certain critical medications,” noted Sanders and Cummings in an online statement. “Without fast access to this drug, used to treat a very serious parasitic infection, patients may experience organ failure, blindness, or death. Americans should not have to live in fear that they will die or go bankrupt because they cannot afford to take the life-saving medication they need.”

Sander’s plan

Sanders recently introduced legislation that would authorize the Department of Health and Human Services to negotiate drug prices with pharmaceutical companies, impose stiffer penalties for drug companies that commit fraud, ban brand-name drug makers from paying competitors to keep lower-priced generics off the market, and make it easier to import lower-priced drugs from Canada.

“Americans should not have to live in fear that they will go bankrupt if they get sick. People should not have to go without the medication they need just because their elected officials aren’t willing to challenge the drug and health care industry lobby,” Sanders said in a press release. “We should use our buying power to get better deals for the American people. Other countries do it and so should we.”

 

Clinton’s approach

Clinton’s plan includes a $250 monthly cap on out-of-pocket prescription drug costs for specialty drugs, a ban on "pay-for-delay agreements, and the ability for Medicare to negotiate prices with drug manufacturers.

Even if Clinton or Sanders’ proposal could get through the Republican-controlled Congress, some experts doubt either plan would serve Americans well.

"Both Bernie Sanders and Hillary Clinton take a short-sighted view of drug costs and benefits. More government regulation will only discourage investment in innovation, without addressing the underlying problem: too little competition across the healthcare system,” said Paul Howard, a senior fellow at the Manhattan Institute for Policy Research in a statement. “Focusing on drug prices alone will only lead to fewer new drugs and worse health in the long run. And the long run is what we need to be thinking about as we try to address the human and financial costs associated with devastating diseases like Alzheimer's, cancer, and diabetes."