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Big Pharma Controls What We Pay for Drugs

Posted Sep 07 2012 7:24pm

As most of our readers know I am not only a senior citizen but one who has had a heart transplant.  I am on Medicare, have supplemental insurance and also participate in Medicare Part D, the prescription drug program.

Both age and my status as a transplant recipient cause me to take several expensive drugs.  While anti-rejection drugs are fully covered by Medicare others for blood pressure, COPD and thyroid are not.  They are expensive, very expensive and while in the so-called “Donut hole” we have paid nearly $1,000 a month so the price of prescription drugs is a big issue in our home.  Upon passage of the affordable care act the cost was cut in half but $500 a month is still a lot of money.  That’s my lead in to this question.

Will someone please offer a reasonable, understandable and clear explanation as to why Medicare is not allowed by law to negotiate the price of drugs?  I have researched this issue for hours and can’t find a simple explanation.  There are a lot of convoluted, rambling excuses but not a clear reason.  Here’s an example of the reasoning Pharmaceutical companies use for their opposition to allowing Medicare to negotiate the price of drugs (like the Veterans Administration does).  “Federal price negotiations would represent a policy change carrying significant risks for research and development investment in new and improved medicines. A substantial body of research shows that similar federal drug programs impose prices substantially lower than those negotiated in the private sector, and that such lower prices inevitably will reduce research and investment in new and improved medicines. This slowdown in pharmaceutical innovation will yield highly adverse effects upon future patients in terms of reduced life expectancies.”

Yakkity, Yak, blah, blah, blah!.  On one hand big pharma tells us that negotiating drug prices would cut research money while on the other hand we learn they have spent $2.3 billion on lobbying and $183 million on campaign contributions since 1998, according to the Center for Responsive Politics. The ready money serves as a strong deterrent against any legislative proposal that would lower costs for consumers and profits for the drug makers.  Furthermore keeping drug prices high for seniors adds $150 to $300 Billion to drug industry profits over a ten year period. The increased costs hit the pockets of both seniors and taxpayers.

Yeah, those poor pharma people sure are hurting.  When you are willing to spend over $2 Billion to protect your profitability, profitability must be sky high.  I don’t know how, in good conscience any member of congress or the President of the United States can oppose giving Medicare the right to negotiate the price of drugs.  They are, after all, probably the biggest supplier of drugs in the world but that’s not the end of the pharma, health insurance, special interest war on us (yes us, you and me) campaign.

Let us take a look at the drugs that keep organ transplant patients alive. They are called immunosuppressants or more commonly, anti-rejection drugs.  Here’s the story. If you are of retirement age or disabled or somehow covered by Medicare they will pay 80% of the cost of an organ transplant and the full cost of those absolutely necessary anti- rejection drugs for the rest of your life.  Without them organ transplant patients would die.

Here’s the rub –  If you have kidney disease (only kidney patients are eligible for this program) and are not disabled or of retirement age Medicare will pay 80% of the cost of the transplant but will only provide you with free anti-rejection drugs for thirty six months.  Some people would say, “That’s fair, a person should be able to go back to work and pay for their own drugs,” and that is a reasonable thought but the price of anti-rejection drugs is anything but reasonable.  They can cost from $1,000 to $3,000 per month, for life.  If you stop taking them your body will begin to reject your organ and you could die.

Now here’s where the story becomes absolute nonsense.  Let’s assume you can’t pay for the drugs and you go into rejection and are hospitalized.  Medicare will pay 80% of the cost of your care and even 80% of the cost of another transplant and if a transplant able organ is not available they will pay for you to be on dialysis for the rest of your life.  Taxpayers spend more than $20 billion a year to care for about 400,000 people who get dialysis treatments — about $77,000 per patient.  The most that anti-rejection drugs would cost would be less than half that amount, $36,000 per year, yet congress refuses to allow Medicare to pay for the drugs. Every year a bill is introduced that would at least extend the 36 month period if not eliminate it entirely but it is defeated every time.

If you think all of this is pretty stupid, it gets dumber. One of the organizations that has opposed extending the 36 month period is the National Kidney Foundation (NKF).  NKF says they oppose the added benefit because money to pay for it would have to come out of dollars earmarked for dialysis coverage, but wait…if patients had the drugs they wouldn’t need dialysis, would they?  Do you get the idea that NKF has an interest in keeping the dialysis industry alive?  The dialysis industry is huge and there are only two major players.  If you want to learn more about this industry go to http://www.propublica.org/article/in-dialysis-life-saving-care-at-great-risk-and-cost

There is an adage that says  you shouldn’t let the fox guard the chicken coop but it seems that is what has happened in health care generally but certainly in the two situations I outlined here.  According to Open Secrets.com, The Pharmaceutical industry alone spends billions of dollars on influencing our lawmakers…here’s the chart…

Top Contributors, 2011-2012

Contributor

Amount

Pfizer   Inc

                $1,287,136

Amgen   Inc

                 $1,017,312

Abbott   Laboratories

                 $868,480

Stryker   Corp

                 $819,464

AstraZeneca   PLC

                 $794,863

Merck   & Co

                 $763,935

Johnson   & Johnson

                 $716,541

Upsher-Smith   Laboratories

                 $612,900

Eli   Lilly & Co

                 $571,179

McKesson   Corp

                 $555,125
                 $539,950

EOE   Inc

                 $525,000

GlaxoSmithKline

                 $493,472

Masimo   Corp

                 $469,468

AmerisourceBergen   Corp

                 $461,877

Roche   Holdings

                 $458,940

Novartis   AG

                 $454,089

Harris   Frc

                 $351,000

Bayer   AG

                 $341,715

Sanofi

                 $299,526

Contributions to Democrats  Republicans  Outside Spending Groups

Top Recipients, 2011-2012

Candidate

Office

Amount

Obama, Barack (D)      $785,385
Romney, Mitt (R)      $622,986
Hatch, Orrin G (R-UT)

Senate

     $327,627
Upton, Fred (R-MI)

House

     $253,615
Brown, Scott (R-MA)

Senate

     $246,953

Knowing all of this once could make a person a little paranoid.  What I’m about to say is totally without foundation but certainly would make for a good movie or book.  The pharmaceutical industry has absolutely no interest in any of us getting well.  Think about it, it is not profitable if we get well.  They don’t want us well and they certainly don’t want us dead, you can’t make any money off of dead people so their best strategy is to keep us alive and suffering so they can sell us medication at absurdly inflated prices.  That’s my movie plot.  Of course, no responsible business would even think of such a thing, would they?

Bob Aronson of Bob’s Newheart is a 2007 heart transplant recipient, the founder of Facebook’s nearly 2,500 member Organ Transplant Initiative and the author of most of these donation/transplantation blogs.

You may comment in the space provided or email your thoughts to me at bob@baronson.org. And – please spread the word about the immediate need for more organ donors. There is nothing you can do that is of greater importance. If you convince one person to be an organ and tissue donor you may save or positively affect over 60 lives. Some of those lives may be people you know and love.

Please view our video “Thank You From the Bottom of my Donor’s heart” on www.organti.org This video was produced to promote organ donation so it is free and no permission is needed for its use.

If you want to spread the word personally about organ donation, we have another PowerPoint slide show for your use free and without permission. Just go to www.organti.org and click on “Life Pass It On” on the left side of the screen and then just follow the directions. This is NOT a stand-alone show; it needs a presenter but is professionally produced and factually sound. If you decide to use the show I will send you a free copy of my e-book, “How to Get a Standing “O” that will help you with presentation skills. Just write to bob@baronson.org and usually you will get a copy the same day.

Also…there is more information on this blog site about other donation/transplantation issues. Additionally we would love to have you join our Facebook group, Organ Transplant Initiative The more members we get the greater our clout with decision makers.


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