Juliana Keeping, of Oklahoma City, had to pay $1,000 out of pocket – five times – for a drug that prevented her 4-year-old son from catching a severe cold that could have had a catastrophic effect on his cystic fibrosis. Her insurer denied payment for the treatment, citing a 1960s study on handwashing.
Tanya Koller, 53, of Schenectady, has battled diabetes for decades and more recently was diagnosed with bipolar disorder. She landed on Medicare because of her disabilities, but under Part D, her monthly supply of medications still cost her $1,700 out of pocket.
David Mitchell, 67, spent several hours one day last week getting an infusion of two drugs that help stave off multiple myeloma, an incurable – but treatable – blood cancer he has battled for almost seven years. The cost: $20,000.
"I'll need 22 more of these treatments over the next year," said Mitchell, of Potomac, Md. "I'm a very expensive baby; $450,000 worth of drugs a year are keeping me alive."
Medicare, including the Part B supplemental insurance he pays extra for, will cover the cost. But an oral drug called Revlimid – a medication he once took – costs Medicare patients with Part D coverage about $11,500 a year out of pocket.
The median annual income of someone on Medicare is $26,200.
That kind of devastating math is why Keeping, Koller and thousands of others have shared their stories with the nonprofit Patients for Affordable Drugs, which Mitchell established and helped build during the last several months. He hopes people from Western New York will be among those willing to shed light on the impact of the cost of prescription drugs on a health care system he says is rigged against consumers, patients and taxpayers.
Ben Wakana, a former spokesman for the federal Department of Health and Human Services, is executive director of Patients for Affordable Drugs.
"Our core belief in setting this up is that drug prices are not going to come down unless patients stand up and fight for lower drug costs," he said. "One of the things we encourage people to do – after they figure out their own situation – is to share their story with us. That is where we can help them, and make sure that their local elected officials or federal officials or governor or policymakers understand that high drug costs are taking a toll on people right now, and that we need action."
Mitchell, who retired last year to put his energies into the nonprofit, worked three decades as a strategic communication specialist focused on health care and public health. He helped bring the Click it or Ticket seat belt initiative, Mothers Against Drunk Driving and the Campaign for Tobacco-Free Kids to the national stage.
Wakana and Mitchell talked by phone this week about their latest public health effort.
Patients for Affordable Drugs has launched a website – patientsforaffordabledrugs.org – which asks Americans to share accounts of how drug costs have impacted their lives. The website also offers potential solutions to high drug costs in an effort to help shape and advocate for new policies.
Mitchell during the last few months has begun to appear at health-related professional conferences and on Capitol Hill, armed with his own story and now, many others.
The common themes?
"We hear from a lot of people writing about drugs that don't have a lot of competition and are high-priced drugs," Wakana said. That includes drugs for people with arthritis, cancer, cystic fibrosis, diabetes, mental illness and multiple sclerosis.
"We also hear heartbreaking stories," the executive director said. "We had a woman write us the other day who said, 'I am contemplating not taking my drugs and dying because I do not want to bankrupt my family.' " Others have sold their homes, burned through retirement or college savings, or moved in with children and grandchildren to steer money to prescription medication costs.
"You have health choices being changed by high drug prices," Wakana said. "People skipping drugs, cutting pills in half, waiting to take their insulin drugs. Arthritis patients saying, 'My hands are curling but I can't take my arthritis medication because it's so expensive.'
"One of things that's surprised me is the level of anger," he said. "I believe people in Washington when they say they're upset about high drug prices and want to do something about them, but the level of frustration we're seeing across the country is much higher than I think we see in Washington."
The frustration cuts across race, geographic region and political persuasion.
"Eighty percent of people in the country feel we should impose price controls on drug companies and that includes a majority of Republicans," Mitchell said. "That's the level of anger. When you combine it with the sadness, the real life struggles of these people, they really feel abused and taken advantage of – and can't understand why it's permitted. The fact is they have every reason to feel that way."
WHY SO HIGH?
Mitchell argues that the pharmaceutical market doesn't work quite so well for patients and families when a few large companies with big pockets also have oversized influence.
"The drug corporations have spent the last 40 years or so building a legal and regulatory framework that enables them to exercise monopoly pricing power," he said. "Once they set a price, it ripples down the whole system and pharmacy benefit managers who run prescription drug insurance programs make more working off the higher prices. Doctors and hospitals receive markups on drugs they administer and make more working off a higher price. So you have a system built to enable profits ... and not designed to protect consumers or patients or taxpayers.
"Why do corporations charge so much for their drugs? Because they can."
Mitchell and Wakana talked of several forces that combine to make American drug prices among the highest in the world.
– Medicare is prohibited from bargaining over drug prices, even the most expensive, so the drug companies get to tell the government what they will charge. This price generally ripples through the system.
– Pharmacy benefit managers can negotiate price reductions for insurance companies they represent, but here's what can happen in this $300 billion part of the system, Mitchell said. Say that manager negotiates a 20 percent discount on a drug for a client, takes 10 percent for the service and gives the other 10 percent to the insurance company in the form of a lower-priced drug. "Consumers see none of those savings," Mitchell said. "We don't believe that pharmacy benefits managers are doing a ton of public service here. They are benefiting from higher drug prices."
– Drug companies tend to spend much more on advertising and marketing than research and development. Mitchell put the range at 20 to 40 percent versus "at most 15 percent to sometimes as little as a penny." Who ultimately pays for all those TV ads we see during news programs and sporting events? Taxpayers and patients who foot the cost of those drugs.
– Nearly half of drug development research costs – including about 75 percent of new, innovative drugs – is borne by the federal government and government-funded research institutions, but it's unclear how this benefits American patients financially. This work saved Mitchell's life, and he's grateful. Still, he said, "The fact is overwhelmingly, in terms of breakthroughs that save people's lives and change lives, we as taxpayers are paying for them. Then the drug companies acquire the patent rights and charge us outrageous prices, so we pay at the front end for the innovation we all want and need, and then we pay to support the drug companies' profits and stock prices and executive compensation and advertising to get us all to buy more drugs."
– Drug companies go to great efforts to prolong their patents. Mitchell shared three ways: Using risk evaluation and mitigation strategies to refuse to provide samples to generic manufacturers so they can develop a bioequivalent drug; making small changes on a patented drug and extending the patent when the improvement might be negligible; and offering incentives to generic drug-makers to delay production of cheaper equivalents.
It can be hard to change a sector of the economy that accounts for 17 percent of domestic gross domestic product, Mitchell said, especially when powerful interests reap the benefits as things stand.
Pharmaceutical and medical product companies have spent $2 billion lobbying Washington since 2003, according to the Center for Responsive Politics. They've also donated to patient advocacy organizations.
Those groups bolster education and access to important health information, Wakana said, "but what very few of them do … is speak out against drug prices."
Patients for Affordable Drugs will not accept money from the pharmaceutical industry – though even patient advocacy groups that do have raised concerns about high drug costs.
“Historically, this issue has not been a top-tier priority but over the last several years that has shifted,” said Marc Boutin, chief executive officer of the National Health Council, which represents more than 100 national patient advocacy organizations focused on people with chronic illnesses and disabilities. Drug costs make up about 12 percent to 15 percent of total health expenses, he said, and have become “incredibly challenging for multiple complex reasons,” particularly among patients with the greatest needs.
“From an overall perspective of the patient organizations, we’re concerned about the total cost,” Boutin said. “If you don’t have access to a physician or an intervention or service, it doesn’t matter whether the medicine is affordable or not.”
Calls to bring down drug costs come during a time when attempts to repeal and replace the Affordable Care Act have preoccupied the new Congress.
"It has sucked all the air out of the room," Mitchell said. "However, there are a few different bipartisan pieces of legislation that quietly, behind the scenes, are being discussed and brought into position, the starting gate, for action."
Maryland passed an anti-price gouging law affecting off-patent brand drugs and generics. Nevada passed a law that requires transparency in how insulin manufacturers price their drugs. Connecticut recently enacted a law requiring greater transparency from pharmacy benefit managers.
"We need political will from people in Washington," Wakana said, "and the only way we'll get that is if people share their stories with elected officials – and tell them this is something that needs to happen now."
HOW TO BRING PRICES DOWN
Congress has the power to do a lot of things that would bring down the price of prescription drugs, Wakana said. "This is not an intractable problem."
The nonprofit supports five policy solutions:
Break the monopoly pricing power of drug companies: Congress should give Medicare the ability to negotiate prices with drug companies. "The idea that the largest purchaser of drugs in the country – which is supported by taxpayers – by law is not allowed to negotiate the price of drugs is, as Donald Trump himself has said, crazy," Wakana said.
Speed generics to market: The FDA and Congress both are considering changes that would make it harder for drug companies to protect patents and easier for generic drug-makers to gather information needed to make less-expensive medications.
Fix a snag in the system: Pharmacy benefit managers negotiate lower drug prices for their insurance company clients but the system has provided little help to taxpayers and consumers, Mitchell said. The public deserves a better look into how this arrangement works – or doesn't.
More transparency in how drug companies set prices: If a drug is invented using taxpayer money – and almost half of all drugs are – then drug corporations should be required to disclose how they set the prices. "The lowest barrier to entry should be a little transparency as to why drug corporations are pricing drugs that are paid for by taxpayers at these outrageous numbers," Mitchell said.
Value-based pricing: A drug price should be based on an analytical model that looks at similar drugs already on the market and how much it will advance care. "We should ask, 'Is the drug price in accordance with the value it delivers to patients," Wakana said, "or is it priced on what the market can bear?"
Mitchell testified Tuesday before an FDA panel considering ways to bring generics to more quickly to market. "I believe we can pass legislation in this Congress," he said. "Beyond that, I would say requiring transparency from pharmacy benefits managers – the people that run the drug insurance programs – has some bipartisan energy behind it. I think something could happen on that front."
Boutin, with the National Health Council – which represents more than 100 national patient advocacy organizations – said the association generally supports the last four policy solutions. He said policy experts and health economists who have looked the prospect for Medicare negotiation believe the federal program doesn’t have the resources to buy and study thousands of medications, and that its decisions could limit drug competition and patient choice.
Another great challenge tends to come with drugs designed for patients with the rarest and most debilitating diseases, Boutin said.
“There is an issue when you have single-source products. If you have only one, the current system has no mechanism to drive that cost down.”
WHAT YOU CAN DO NOW
Consumer Reports recommends the following tips about what patients and families can now when it comes to prescription drug costs:
Comparison shop: When faced with a sudden price hike for a drug, a Consumer Reports poll found that only 18 percent comparison shopped for a better deal.
Talk to your doctor: Your doctor probably won’t broach the topic. If it’s important to you, you should. If your insurance drops or reduces coverage of a drug, your doctor can help by appealing to your insurance company for an exception.
Ask for generics: You will get the same active ingredients at a cost up to 90 percent less than brand-name drugs.
Check your local pharmacy: Consumer Reports found some bargains at local independent pharmacies, and some higher prices – and often had luck negotiating for a lower price.
Compare insurance plans: Make sure you don’t get stuck next year with a plan that no longer covers your medications.
Get a 90-day prescription: For drugs you take monthly, it can be more convenient – and less expensive.
Consider $4/$10 discount generics: Stores including Walmart and Sam’s Club offer hundreds of common generics for $4 for a 30-day supply and $10 for a 90-day supply if you don’t use insurance. Check the fine print: there may be a small fee to sign up for some programs.
Always ask: “Is this your lowest price?” Costco told Consumer Reports that pharmacists there can’t offer customers with Medicare a lower cash price unless a customer asks.
Look online: If you’re paying out of pocket, check goodrx.com to learn its “fair price” and use that to negotiate if a pharmacist quotes you a higher price. You can also fill a prescription with an online pharmacy. Consumer Reports secret shoppers found that healthwarehouse.com had the lowest prices overall. For other websites, be careful to only use retailers that operate within the U.S. and display the “VIPPS” symbol to show that it’s a verified internet pharmacy practice site.
Tell your story: If you want to share your concerns about the high cost of your medications – out-of-pocket or not – tell your story at patientsforaffordabledrugs.org. You may also find more Consumer Reports Best Buy Drugs tips under the website’s “Resources” tab.
Twitter: @BNrefresh, @ScottBScanlon
Story topics: big pharma/ buffalo/ congress/ drug costs/ health/ health care/ patients for affordable drugs/ prescription drug costs/ prescription drugs/ prescription pills/ washington/ western new york