(no subject)
I just need to put this someplace so I know I have it. Anyone who wants to know about prescription drugs: enjoy.
Spencer Faust
EngC 1012-009
Research Paper
3-28-2005
Prescription drug prices in the United States:
Helpful or hurtful?
A fast growing concern in the United states, particularily among the elderly, is the rising cost of prescription drugs being put on the market. Many Americans are finding it harder and harder to meet monthly medication bills, and some are forced to choose between medication and utilities, or even food. However for Pharmeceudical companies there is a delicate balance between giving customers discounts and being able to pay for
researching new and improved medicines. Finding a middle ground is proving exceedingly difficult, all plans reached thus far have fallen short of expectations on one side or the other. While there is much disagreement over what is to be done, the general concensus is that something should be done: be it raising the prices of medication to cover the cost of research or lowering the cost of medication in order to make it affordable for needy
citizens who cannot afford to pay the current rates.
The most common arguement is that the costs for prescription medication should come down so that ill persons do not have to go without some nessecity of life in order to purchase their medicine. The testimony of three citizens, age 85, 73 and 51, from a congressional hearing held in April of 1993 to discuss prescription drug prices (PDP) is an example of what many people are going through. All three have been prescribed medication, and all three outline briefly their financial income and expenses during an average month. On average, after rent, utilities and medication had been deducted from their income the average amount they had to live on was $47.33 a month(PDP, 5-7). However during another such hearing in June of 2003 to discuss the economic aspects of the pharmeceutical industry (EAPI) one Stephen Moore makes an exellent point, “for every profitable drug... there are dozens, scores, hundreds of drugs that fail,that don’t make it to the market. So the [drugs] that you are talking about that are very profitable are subsidizing the ones that are failures”(EAPI, 68). This is true, the pharmeceudical industries are spending fully 16% of what they make on every drug purchase on the research and development of new and improved drugs(PDP, 3). So it’s true that while drug prices are high there is a need for the money to be able to subsidize the losses from less successful drugs that money has been invested in for research.
One means of obtaining prescription medication available to citizens living far north or south is to cross the border to purchase drugs in either Canada or Mexico. During the prescription drug pricing hearing, one Donald Krause, M.D. compared drug prices in the United States with those in Canada. “The results to me were surprising. I expected every single [drug] would be cheaper in Canada and that’s not true”(PDP, 11). Krause found that out of 7 prescription drugs commonly used by the elderly, including zantac, prilosec and ceftin, 4 of the drugs were cheaper to buy here in the United States. However during the discussion of the economic aspects of the pharmeceutical industry hearing Dan Burton points out some of the differences between prices in Canada and the United States. Some examples he gives show Canadian drugs being more than $60 cheaper. Burton claims that in buying prescription drugs in Canada instead of the United
States a person can save anywhere between 20 and 80 percent. It is estimated that close to one million Americans buy between $500 million and $1 billion worth of prescription drugs a year(EAPI, 2).
One newspaper article ran in the LATimes, ‘Industry Aims to Defeat Discount Drug Initiative’, outlines another route some organizations, such as Health Access California, are taking is making the issue appear on an upcoming ballot and giving the general population the chance to vote on the issue. Even though it is only statewide this is considered by many to be a drastic step, as it would put a considerable dent in the profits of pharmeceudical companies and set an example for other states to follow. The pharmeceudical companies have taken steps of their own to try and find a middleground with which everyone can be happy. They have met with California govenor Arnold Schwarzenegger to make a voluntary plan that would make anyone in California making less than three times the federal poverty level elligable for discounts on prescription medication. The pharmeceutical companies prefer this plan to the Health Access’ plan, which would make anyone earning four times the federal poverty level elligable. Also any pharmeceutical company that did not comply with Health Access’ plan would not be able to sell to Medi-Cal, which buys $3 billion worth of drugs every year. Many plans such as the one being made by Govenor Arnold Schwarzenegger and the pharmeceutical companies have been implimented in other states, such as Maine, Ohio and Iowa. Almost all have either gone out of use or hardly had any effect on lowering the cost of prescription drugs. California planners claim that the fault is in the planning, not the help of the pharmeceutical industry(IAD).
Whoevers fault it is that drug prices are so high, and it may be nobodies, something must be done. Despite pharmeceutical companies claims that the rising cost of prescription drugs is to help finance the research and development of new drugs to help citizens and people worldwide, 35% of what drug comanies make on every drug purchase goes to advertising. One nurse in Maine writes:
“Everyday drug salesmen come to this health center leaving clocks, calculators, books, posters, pens, memo pads, candy, season ski-lift tickets, and on one occasion, front-row tickets to a show by a nationally known performer who was giving a show locally.
Two or three days a week the drug salesmen will provide a free lunch for all nine employees...(PDP, 13)”
While it is true that the drug market is extremely competative it seems that drug companies are going above and beyond reasonable marketing spending when that money could help make their products more affordable. Another viewpoint is that lowering product prices would also raise sales, since more people would be able to afford to buy the products.
The United States is the only country heavily invested in researching, developing and selling drugs that does not have government contrl over prices. As a direct result prices are under the control of the companies themselves and have skyrocketed. One elderly woman taking dyazide, a drug to help blood preassure, claims that in the six years she has been taking the drug price has gone from $5 for one hundred pills to anywhere from $50 to $65 for one hundred pills(PDP, 5). This is not a new trend either, during the years 1980 through 1992 drug inflation in the United States was six times normal inflation. A system for the pricing, research and development as well as distribution of drugs in the United State must be implimented if we are going to keep prescription drug prices under control.
Spencer Faust
EngC 1012-009
Research Paper
3-28-2005
Prescription drug prices in the United States:
Helpful or hurtful?
A fast growing concern in the United states, particularily among the elderly, is the rising cost of prescription drugs being put on the market. Many Americans are finding it harder and harder to meet monthly medication bills, and some are forced to choose between medication and utilities, or even food. However for Pharmeceudical companies there is a delicate balance between giving customers discounts and being able to pay for
researching new and improved medicines. Finding a middle ground is proving exceedingly difficult, all plans reached thus far have fallen short of expectations on one side or the other. While there is much disagreement over what is to be done, the general concensus is that something should be done: be it raising the prices of medication to cover the cost of research or lowering the cost of medication in order to make it affordable for needy
citizens who cannot afford to pay the current rates.
The most common arguement is that the costs for prescription medication should come down so that ill persons do not have to go without some nessecity of life in order to purchase their medicine. The testimony of three citizens, age 85, 73 and 51, from a congressional hearing held in April of 1993 to discuss prescription drug prices (PDP) is an example of what many people are going through. All three have been prescribed medication, and all three outline briefly their financial income and expenses during an average month. On average, after rent, utilities and medication had been deducted from their income the average amount they had to live on was $47.33 a month(PDP, 5-7). However during another such hearing in June of 2003 to discuss the economic aspects of the pharmeceutical industry (EAPI) one Stephen Moore makes an exellent point, “for every profitable drug... there are dozens, scores, hundreds of drugs that fail,that don’t make it to the market. So the [drugs] that you are talking about that are very profitable are subsidizing the ones that are failures”(EAPI, 68). This is true, the pharmeceudical industries are spending fully 16% of what they make on every drug purchase on the research and development of new and improved drugs(PDP, 3). So it’s true that while drug prices are high there is a need for the money to be able to subsidize the losses from less successful drugs that money has been invested in for research.
One means of obtaining prescription medication available to citizens living far north or south is to cross the border to purchase drugs in either Canada or Mexico. During the prescription drug pricing hearing, one Donald Krause, M.D. compared drug prices in the United States with those in Canada. “The results to me were surprising. I expected every single [drug] would be cheaper in Canada and that’s not true”(PDP, 11). Krause found that out of 7 prescription drugs commonly used by the elderly, including zantac, prilosec and ceftin, 4 of the drugs were cheaper to buy here in the United States. However during the discussion of the economic aspects of the pharmeceutical industry hearing Dan Burton points out some of the differences between prices in Canada and the United States. Some examples he gives show Canadian drugs being more than $60 cheaper. Burton claims that in buying prescription drugs in Canada instead of the United
States a person can save anywhere between 20 and 80 percent. It is estimated that close to one million Americans buy between $500 million and $1 billion worth of prescription drugs a year(EAPI, 2).
One newspaper article ran in the LATimes, ‘Industry Aims to Defeat Discount Drug Initiative’, outlines another route some organizations, such as Health Access California, are taking is making the issue appear on an upcoming ballot and giving the general population the chance to vote on the issue. Even though it is only statewide this is considered by many to be a drastic step, as it would put a considerable dent in the profits of pharmeceudical companies and set an example for other states to follow. The pharmeceudical companies have taken steps of their own to try and find a middleground with which everyone can be happy. They have met with California govenor Arnold Schwarzenegger to make a voluntary plan that would make anyone in California making less than three times the federal poverty level elligable for discounts on prescription medication. The pharmeceutical companies prefer this plan to the Health Access’ plan, which would make anyone earning four times the federal poverty level elligable. Also any pharmeceutical company that did not comply with Health Access’ plan would not be able to sell to Medi-Cal, which buys $3 billion worth of drugs every year. Many plans such as the one being made by Govenor Arnold Schwarzenegger and the pharmeceutical companies have been implimented in other states, such as Maine, Ohio and Iowa. Almost all have either gone out of use or hardly had any effect on lowering the cost of prescription drugs. California planners claim that the fault is in the planning, not the help of the pharmeceutical industry(IAD).
Whoevers fault it is that drug prices are so high, and it may be nobodies, something must be done. Despite pharmeceutical companies claims that the rising cost of prescription drugs is to help finance the research and development of new drugs to help citizens and people worldwide, 35% of what drug comanies make on every drug purchase goes to advertising. One nurse in Maine writes:
“Everyday drug salesmen come to this health center leaving clocks, calculators, books, posters, pens, memo pads, candy, season ski-lift tickets, and on one occasion, front-row tickets to a show by a nationally known performer who was giving a show locally.
Two or three days a week the drug salesmen will provide a free lunch for all nine employees...(PDP, 13)”
While it is true that the drug market is extremely competative it seems that drug companies are going above and beyond reasonable marketing spending when that money could help make their products more affordable. Another viewpoint is that lowering product prices would also raise sales, since more people would be able to afford to buy the products.
The United States is the only country heavily invested in researching, developing and selling drugs that does not have government contrl over prices. As a direct result prices are under the control of the companies themselves and have skyrocketed. One elderly woman taking dyazide, a drug to help blood preassure, claims that in the six years she has been taking the drug price has gone from $5 for one hundred pills to anywhere from $50 to $65 for one hundred pills(PDP, 5). This is not a new trend either, during the years 1980 through 1992 drug inflation in the United States was six times normal inflation. A system for the pricing, research and development as well as distribution of drugs in the United State must be implimented if we are going to keep prescription drug prices under control.