The American people have spoken loudly, demanding the government stop implementing policies that drive up the prices of goods and services. Voters feel the pain of inflation every time they fill their gas tanks, put food in their shopping carts, or pay their heating and air conditioning bills. However, the large pharmaceutical companies seemingly didn’t get the memo and are, once again, raising prices.
A few days before Donald Trump was sworn in, major pharmaceutical companies announced a round of price increases for critical drugs. The price of at least 250 diabetes, cancer and other essential medications will increase, further putting those who need these lifesaving drugs in a financial hole. These actions confirm the results of a recent survey in which a majority of Americans believe prescription drug prices are too high and that drug company profits are a major contributor.
This shouldn’t come as a shock. AARP, America’s largest senior organization, recently released a new analysis of the prescription drug market, finding that “the 25 brand drugs with the most Medicare Part D spending … have had their list prices increase an average of 98 percent over their lifetime.” In other words, Americans can expect the price of the prescription drugs they use most frequently to double over their lifetimes.
The kicker is that these price increases came even with significant pricing help from pharmacy benefit managers, the groups that businesses hire to negotiate with the drug companies and pressure them to reduce their costs. Impressively, PBMs have managed to lower the cost of Medicare Part D spending by 20 percent in some years. Still, even with PBMs’ assistance, drug prices will double in most Americans’ lifetimes. Talk about a racket.
Pharmaceutical companies justify price hikes by pointing to the high costs of research and development, but many of the drugs with the steepest price increases are already well beyond their initial research phases. In true monopoly fashion, these companies are exploiting their market dominance and the absence of meaningful competition.
This begs the question: Are these price increases primarily driven by the pursuit of higher profit margins at the public’s expense?
Big Pharma, of course, wants to make sure we never get an answer to that question. That’s why they spend so much on federal and state lobbying campaigns — to keep lawmakers quiet. The return on investment for lobbying often outpaces even the return on investment for bringing drugs to market. Because of its political contributions and influence, Big Pharma is used to getting what it wants from policymakers, making it impossible to implement legislation that would increase competition and lower drug prices.
Encouragingly, President Trump has viewed Big Pharma with suspicion. During his previous administration, he implemented a price cap for diabetes drugs, ensuring that insulin became more affordable for millions of Americans. He also introduced international pricing models aimed at tying U.S. drug prices to the lower prices charged in other countries and pushed for greater transparency in hospital pricing to empower consumers.
Trump’s selection of Robert Kennedy Jr. to head the Department of Health and Human Services also sends a signal to Big Pharma that their days of controlling Washington are ending. Kennedy has been a staunch industry critic and sees how their political power keeps costs high for Americans. His leadership presents an opportunity to reshape and reform the system in favor of patients rather than corporate interests.
The American people have made it clear that they want lower drug prices, more transparency and accountability from an industry that too often prioritizes its healthy bottom line over the well-being of the American people. It’s well past time for policymakers — federal and state — to listen and act to protect consumers and seniors rather than lobbyists and the profits of big pharmaceutical companies.
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2 thoughts on “Drug Companies Are Price Gouging Again – Inside Sources”
The true history of Pharma in America is one of growth but into the area of collusion between Pharma and federal regulators and buying the support of congress. Did you catch Robert Kennedy Jr’s remark to Senate’s who were harassing him? RK Jr noted they all had taken millions in donations from the drug companies as Bernie Sanders “sputtered” and “stammered”!
Locally, we require office holders to not vote on issues they have financial interest in. The same should apply to congress.
Tell us about all those life saving drugs that were developed in Canada or even Europe? The opening sentence says government policy is driving this but not one mention or description in the article. Move to Canada if you are not happy. I got sick up there and 3 weeks to see a GP. Hip or knee replacement you are on a years long waiting list. The profits from drugs that are past their prime goes to research for other ills. Some drugs may be over priced but all in all we have a better deal in the USA.
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