| With the recent news that Biogen’s Aduhelm™ medication for Alzheimer's disease would be priced at $56,000 annually, I started thinking about how we go into the situation where market competition is allowed to control medication pricing in this country. This has led to higher medication prices in the U.S. than in other countries ~ often by a factor of 5-10 fold. As an example, I list below costs for commonly used brand-name drugs (90-day supplies in October 2018):
Premarin 0.625 mg costs $623.70 in U.S. vs. $76.61 in Canada Atorvastatin 20 mg costs $37.36 in the U.S. vs. $83.74 in Canada Another powerful example of drug pricing that has been examined carefully in recent years is MS disease-modifying therapies. “First-generation DMTs, originally costing $8,000 to $11,000, now cost about $60,000 per year. Costs for these agents have increased annually at rates 5 to 7 times higher than prescription drug inflation. Newer DMTs commonly entered the market with a cost 25%–60% higher than existing DMTs. Significant increases in the cost trajectory of the first-generation DMTs occurred following the Food and Drug Administration approvals of IFN-b-1a SC (2002) and natalizumab (reintroduced 2006) and remained high following introduction of fingolimod (2010).”1 Medicaid spending on 15 MS drugs increased from $453 million to just over $1.3 billion between 2011 and 2017. It is unclear how and why prices have increased, and the striking similarities in annual costs of DMTs suggests a “race to the top”, i.e. charging whatever the market will bear. But there are examples of successful drug pricing controls in the US. Analyses consistently show the VA has the lowest per prescription costs among all federal purchasers. In part, that reflects the success of the national formulary process in negotiating lower prices on some top-selling brands. A perhaps even stronger driver has been the VA's ability to encourage prescribing of lower-cost generic alternatives to ensure that providers prescribe the most cost-effective medications more frequently. As clinical neurologists, I suspect that many of us, and our staff, are spending inordinate amounts of time on pre-authorization for increasingly costly medications, sometimes resulting in delays in treatment, and almost always resulting in patient dissatisfaction and provider frustration. The ANA, AAN, AUPN, CNS, and ABC need to be part of the solution, driving towards a rationalization of drug pricing in this country. Congress is considering a drug pricing plan, known as H.R. 3, that relies on a form of price setting in which the U.S. government would determine the value of medications (unfortunately it seems unlikely the Senate will move this forward). Not surprisingly, PHRMA, the main organization representing the biopharmaceutical industry, is lobbying hard to defeat this effort ~”H.R. 3 is the wrong approach for patients and the U.S. health care system”. The Commonwealth Fund published a useful report2 that identifies potential actionable steps that could be taken to increase access to and affordability of medications for Americans: 1) allow the federal government to become a more responsible purchaser; 2) stop patent abuses and anticompetitive practices that block price competition; 3) build a sustainable biosimilar market to create price competition; 4) fix incentives in the drug supply chain and make the supply chain more transparent; and 5) ensure public accountability in the government-funded drug development process. I encourage all of us to engage with the problem, to become informed about steps to reduce drug prices, and advocate for our patients. Warm regards, Justin C. McArthur, MBBS, MPH |