Until May 1999, the daytime speed limit in Montana was “reasonable and prudent.” Leadfoots from around the country called it the home of the Montanabahn. That’s very much how prices are set by the big drug companies today — with similar results. Last year, commonly used generic medicines spiked higher.
Meanwhile, the pharmaceutical industry is trying to derail a vital federal drug discount program called 340B that helps hospitals and community health centers in Minnesota and across the country supply lower-cost medicines and enhanced services to underserved patients.
The industry’s profiteering has gotten the attention of Congress, insurance companies and patients. Per-unit costs on specialty drugs rose 12 percent last year, according to Express Scripts. A database compiled by Bloomberg News shows the steady price increases of leading medications during the past seven years. An EpiPen for allergic reactions rose 222 percent. A single dose of the drug Benicar for high blood pressure is up 164 percent. The high-cholesterol medicine Crestor jumped 103 percent per pill.
Against this backdrop, the drug industry has marshaled an army of lobbyists to go to war against poor, underserved Americans and the hospitals that treat them. Congress created the 340B drug discount program in 1992 with bipartisan support to allow health providers like the Hennepin County Medical Center that serve large numbers of low-income patients to receive discounted medications from drug companies. In turn, these safety-net hospitals and clinics supply low-cost or no-cost medicines to the community. The program also helps fund diabetes, HIV/AIDS, cancer, dental and primary-care clinics.
Affordable medications are the key to improving health outcomes. When drug costs get too high, patients skip doses — or pass up buying prescriptions altogether. According to a survey from the Commonwealth Fund, the United States leads the world in this respect, with one-quarter of adults choosing to go without their medications. Their health often declines, and many end up back in the emergency room, largely on the taxpayer’s dime.
Everyone agrees, even John Castellani, CEO of the industry trade association PhRMA. In a recent interview with Kaiser Health News, he said patients’ “out-of-pocket expenses are potentially so high that we have to be concerned about whether or not people will be able to afford to continue to get their medicines.”
In fairness, Castellani was complaining about high prescription deductibles in some plans offered under the Affordable Care Act. But what about the devastating impact of his own industry’s overpriced medications? Here, Big Pharma ducks responsibility and conveniently chooses profits over people.
With so much partisan squabbling in Washington, it’s important to remember there are programs that not only work but enjoy bipartisan backing. The 340B program is one of them, and I was proud to support it when I served in Congress. Yes, the program is funded at the expense of extra profits by the drug companies. More important, it allows hospitals and clinics to help poor Americans stay healthier, and it actually saves taxpayer money by keeping people out of the hospital.
Big Pharma will argue that many hospitals don’t provide enough charity care and shouldn’t be in the program. That’s hogwash. It ignores the whopping $28 billion in uncompensated care these providers shoulder each year to treat the needy.
The 340B program helps safety-net hospitals provide affordable medications and treatments to needy outpatients. Like the freewheeling days in Montana, drug companies are hitting the throttle on prices. As the cost of medicine soars, the program becomes more essential than ever. It is time to hit the brakes on the pharmaceutical industry’s efforts to kill it. If we don’t, the casualties will be America’s poor and the hospitals that treat them.
Gil Gutknecht is a former member of the U.S. House from Minnesota. He consults with a number of companies and organizations, including Safety Net Hospitals for Pharmaceutical Access, a nonprofit association of providers participating in the 340B program.