Senate Committee Holds Hearing On Drug Prices
8 CommentsBy Ed Silverman // March 17th, 2010 // 7:15 am
The Special Committee on Aging wants to know why there are “large discrepancies” between the prices charged for meds in the US and other industrialized countries. So letters were sent to six drugmakers - AstraZeneca, Pfizer, Lilly, GlaxoSmithKline, Novartis and Sanofi-Aventis - to explain why drugs can cost up to four times more in the US (click each name to see the letters). And the hearing, which is called ‘Seniors Feeling the Squeeze,’ starts at 2:30 pm EST today (WATCH HERE).
The letters note that US consumers spend an average of $878 a person on meds, compared with $446 a person in other industrialized countries, and then cite specific examples of differences in price. For instance, AstraZeneca’s Nexium costs $3.91 in the US compared with $1.32 in the UK and 88 cents in Germany. Pfizer’s Lipitor costs $2.82 in the US versus 71 cents in New Zealand. The committee cites IMS Health to make the comparisons.
“These differentials are dramatic and often put American consumers at a severe disadvantage globally,” Senator Herb Kohl, the Wisconsin Democrate who chairs the committee, writes in the letters. Kohl, by the way, also heads the Senate appropriations subcommittee that oversees the FDA budget. In seeking the info, Kohl maintains the difference in prices can’t be explained by differences in production or manufacturing.
Kohl also wants to know how much of their research budgets come from US federal funds; profit margins and distribution costs in each industrialized country cited; the percentage of overall profit that comes from the US for each drug listed; and data on marketing, number of employees and samples made and distributed.
doc
Something has got to give. We, as taxpayers, pay for 40% of big pharma’s products through various government agencies and programs.
R&D is expensive, but the amount spent in this country on advertising and promotion is out of control.
pharmavet
Why are we rehashing this? We know the answer is price controls ex-US versus none in the US.
Former Pharma Marketing Director
Because the other countries have a form of health care reform…. It would help us all tremendously if we had this in the US. Why? because the higher prices being paid in the US hike the prices up for the other countries.
Americans pay more through taxes and health care insurance premiums which off-sets lower prices in the other countries. It is not fair at all.
I am curious why the Senate committee excluded the oral cancer drugs from Novartis’ letter. Seems like a big faux pas…Which raises a flag - dare I say this is all for show? Yes, once again something that lacks teeth….
Seems we have a bunch of actors going to work for us pretending to do something for the tax dollars being collected.
How does the saying go? Oh yes, beware the temper of a patient man….When will we the people say “enough already”…
Or maybe this being St. Patrick’s day someone has kissed the blarney stone?
Anne PME
Adam Fein has done some good work on the US drug pricing system. It is not based on reality and although we have better standards in place, a lot of state pharmacy boards have been stripped and/or do not have the budget or other resources to properly oversee and enforce compliance regulations related to prescription drug pricing and billing.
Also, would someone please tell members of congress that pharmacuetical companies sell their medicines via intermediaries AND the medicines are authorized and billed via intermediaries to plans and payors.
In the case of Medicaid, here in my state, our budget has been largely put into balance by Medicaid drug rebates….pay to play…and pricing plays on generic drugs. While I consider myself to be a reasonably intelligent person, dealing with Medicare Part D pricing and access issues is often completely beyond me.
Maybe instead of thinking about drug reimportation (also known in most cases as drug diversion and likely FCPA violations/securities fraud) we should try and fix our own problems in our own backyard once and for all. I worry that if we don’t address prescription drug pricing and acess now, we will be broke and not able to afford to compete with the BRIC countries for vital medicines in 5 or 10 years.
We also need to simplify the system and clarify our goals.
Sydney Rubin
Ed: Anyone tweeting from the hearing room?
Condor
I have other matters to attend to, but a live-feed of the web-streaming video — of Senator Kohl’s hearing — is underway right now (see bottom of that linked-page).
Do click through if you have SWF player, or Windows Media Player installed, and watch for yourself.
“Tweets? We don’t need no stinkin’ Tweets!”
Namaste
Justice in MI
Indeed, without minmizing the issue, I wonder what the wider political strategy is here re: healthcare reform.
collegegirl
It’s ridiculous how much we, as Americans, are spending on our prescriptions when our tax money is helping to fund parts of the drug companies already. Did any of this spending restrictions make it into the final version of the bill?