New drugs for Hepatitis C, leukemia, and several rare diseases can cost $50,000 per month. Companies that sell them stress that developing a new drug is expensive and that these are superior to previous drugs. This is true although it’s hard to judge if their profits are excessive. They might be.
Old drugs once cost slightly more than nothing. A single Lomotil, the leading diarrhea remedy once cost a few cents. It’s now thirty cents for the generic (that’s wholesale; you’d pay more). Colchicine, an excellent gout remedy that doctors have used for several thousand years, cost a nickel a pill. A few years ago it jumped to $5.00. Everyone expressed outrage, including our elected representatives. But it’s still $5.00
How do you explain that?
You may be surprised to learn that Medicare Part D, launched in 2006, which pays for prescription drugs, was a Republican program. Anxious to protect the free market, Republicans included language forbidding Medicare from negotiating drug costs. Doctors and hospitals must accept what Medicare pays but drug companies set their own prices. The Veteran’s Administration (which has the power to negotiate) pays much less. Drug companies are not required to sell to the V.A., but they do, so they’re not losing money. They’re not required to sell in foreign countries where the government regulates drug prices. But they do.
Unquestionably, hanky-panky is going on. I would not be surprised if a bottle of aspirin jumps to fifty dollars in the near future. You can expect our elected representatives to express outrage.