My doctor recently advised me to get a shot for pneumonia. I’m over 65. I volunteer in a homeless shelter. And I’ve had two pretty formidable head colds this year.
She didn’t have the drug in her office, but told me I could get the shot at CVS.
When, prescription in hand, I got to CVS, I found that Prevnar wasn’t covered under my drug plan. The shot would cost me $230. We did a bit of back and forth with my doctor and the insurance provider, but I decided to go ahead and get the shot. Amortized across five years, $230 is not much if it prevents me from getting pneumonia.
The bottom line was my bottom line: I can afford it. (And, miraculously, I had just won $230 by winning the NCAA March Madness bracket at the gym. So I even had the cash in my pocket.)
Lucky me.
But for a lot of folks, $230 is a big deal, especially if they’re elderly and on a fixed income.
When my husband was undergoing cancer treatment, we didn’t bother to keep track of all the drug-related costs – prescriptions, chemo – or any costs for that matter. When we’d get the periodic reports from Medicare and Blue Cross, thick files that no one could possibly understand or interpret, we’d just go to the bottom line and find that – hip, hip, hooray! – we owed nothing.
Over two years of fairly intense treatment, I don’t think that Jim’s accumulated out-of-pocket expenses came anywhere near the $230 I paid for the Prevnar shot.
Lucky us. (Sort of. Jim wasn’t all that lucky…)
But for a lot of folks, even those covered by Medicare and/or other insurance, those thick reports include a notice of how much you owe. And for many of those folks, what they owe can be plenty.
Anyway, with the recent nothing-to-do-with-cancer Prevnar episode and Jim’s treatment not all that far in the rearview mirror, I read an article on one cancer drug in the Washington Post with great interest.
There’s a blood cancer drug, Imbruvica, that costs $148K a year. Some physicians looked into whether they could lower costs by lowering the dosage. Turns out, it looked like they could. Patients with chronic lymphocytic leukemia seemed to do just as well taking fewer pills once they’d gone through an initial higher-dosage round. Which would mean a big money saver for those with high deductibles, and for insurance providers. Looked like a win-win. But not a win-win-win.
While the researchers were thinking about celebrating that win-win:
…they learned of a new pricing strategy by Janssen and Pharmacyclics, the companies that sell Imbruvica through a partnership. Within the next three months, the companies will stop making the original 140-milligram capsule, a spokeswoman confirmed. They will instead offer tablets in four strengths — each of which has the same flat price of about $400, or triple the original cost of the pill.
Just as scientific momentum was building to test the effectiveness of lower doses, the new pricing scheme ensures dose reductions won't save patients money or erode companies' revenue from selling the drug. In fact, patients who had been doing well on a low dose of the drug would now pay more for their treatment. Those who stay on the dose equivalent to three pills a day won't see a change in price. (Source: Washington Post)
The pharmas are, of course, defending this move as innovative and convenient. While – mirabile dictu – keeping their profits.
I’m all in favor of pharmaceutical companies being able to recoup their research costs. But this sounds pretty darned nastily rapacious and f’d up.
Because high out-of-pocket costs are a big barrier to folks staying on their drugs. Someone who had been paying $5K under the prior regimen would now being paying nearly twice that. The average Social Security payment is a bit over $1.1K. And there it could go in one fell swoop. Or worse:
…Despite efforts to connect patients with resources to help them afford co-pays, some will request a drug that is cheaper but maybe less effective — or even push to discontinue the medicine.
I don’t know what the answer is to the high cost of drugs in particular and healthcare in general. And I’m not arguing that it should all be free. It wouldn’t be the end of the world if there were Medicare copays for those who can afford them. And there comes a point where, I believe, someone who elects extraordinary measures should expect to pay for them. (E.g., organ transplants for 80 year olds.)
As gouges go, this move by Janssen and Pharmacyclics, while not quite rising to the Martin Shkreli level, seems a bit much. The new price just ain’t right.
1 comment:
I see you have this labeled "bad business behavior." I would have labeled it "trade offs of regulation."
One of the reasons why drugs are so expensive is the way the FDA operates. It takes many years and often hundreds of millions of dollars to get a drug approved for sale by the FDA. Naturally, the FDA doesn't want to be embarrassed by another Thalidomide, which they approved, and then later it was discovered that it caused horrible birth defects if taken by pregnant women.
But in order to avoid the mistake whereby they approve something that later they regret, instead they make the opposite mistake, failing to approve some drugs that perhaps they should, and making it very long and expensive for drug companies to get approval. That mistake means that people die while waiting for effective drugs to be approved. It means that when drugs do get on the market they have to be high priced to cover the expensive approval process, which means some people can't afford the drug when it does get approved.
The FDA also makes it very tough for competitors of approved drugs. Everyone made a fuss about the price increases that the makers of the EpiPen demanded a couple years ago, and yes, that was "bad business behavior," but there were something like six different competitors that tried to enter the market that the FDA turned down for real "step on a crack, break your mother's back" reasons, leaving Mylan with an unnecessary legal monopoly in the product category, that allowed them to attempt the gouging.
Both mistakes are bad, and ideally we don't want either of them. I think the FDA is so worried about making the mistake of approving things they shouldn't, that their rules force them into too much of not approving things they should. Hence the high prices, and unnecessary deaths and illnesses.
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