The media rage these days when it comes to prescription drug prices is three-fold: 1) generic drug price spikes of literally thousands of percent, 2) specialty medications that cost $1.000/pill, and 3) cancer treatment costs in the hundreds of thousands of dollars per year! We’re glad the media is loudly covering the public health crisis of high drug prices, but its focus of late seems to take the heat off of never ending brand name drug price increases and the pharmaceutical companies that charge those prices. We haven’t forgotten. For us the heat is on: including a loud reminder that these brand drugs are sold much more affordably outside the U.S., and can be found and safely purchased online.
To help us, I looked to the research of David Belk, MD. Dr. Belk, who is concerned with, and voraciously researches the insanity of healthcare costs, publishes a website called True Cost of Healthcare. His research shows that brand name drug prices increased by 13 times the rate of inflation over the past two and a half years. These are medications for which there is no available generic in the U.S. He looked at 335 drugs, their wholesale prices and tracked their increases from the October 2012 to the beginning of 2015. Only one drug, Norvir, actually came down in price. Dr. Belk writes: “All other brand name prescription drugs on my list went up a minimum of 9% and an average of just over 40% in price in only 2 1/2 years.”
While these brand drugs aren’t $1,000 per pill like Sovaldi, many Americans really can’t afford them. Below are two examples of brand name drugs that if purchased outside the U.S., would potentially save an American $4,000 a year and/or prevent that American from going without a prescribed, essential medicine for Diabetes or Asthma.
Januvia 100mg (siptagliptin), a drug that treats type-2 diabetes could cost you $1,149 for a three month supply at a local U.S. pharmacy. With a prescription discount coupon, you might get it for $963. If that’s too much, then brand name Januvia, marketed by MSD (a subsidiary of Merck), can be purchased online for $103.50 from an international online pharmacy– a percentage savings of 91% and a cost savings exceeding $1,000 over 3 months. Over a year, the cost savings is about $4,000.
Another example is Advair Diskus (fluticasone propionate/salmeterol), a popular asthma medication that is out of reach for many Americans due to cost. A three month supply of the 250/50mcg inhaler can run you $1,050 in a local U.S. pharmacy. With a discount card the price might be reduced to $874. At a verified international online pharmacy, the drug called Seretide Accuhaler, the name brand used by GlaxoSmithKline to market fluticasone propionate/salmeterol in several countries, is only $105: another three-month savings of $1,000 and annual savings of $4,000.
This summer at PharmacyChecker.com we’re going to keep the heat on the pharmaceutical industry with lots of examples of the crazy costs of normal brand name drugs in the U.S., and cooling things down for consumers with lots of savings you can find online.
Tagged with: Advair Diskus, Cancer medication, Dr. David Belk, generic drug prices, Januvia, Merck, Seretide Accuhaler, Sovaldi, speciality medications
A new report by Express Scripts has found that medication spending by commercial health plans grew by 13.1% last year, primarily due to the release of high cost Hepatitis C meds. Spending also increased significantly for compounded drugs. In the prior decade, total spending ranged between three and six percent.
Keep in mind that the headline statistic of 13.1% applies to how much was spent on drugs; it actually doesn’t tell us anything about the prices of the drugs. If drug utilization, which refers to the amount of drugs taken, increases while prices stay the same, then there’s more spending. As it turns out, utilization decreased by a marginal 0.1 % and d prices increased by 13.2%, demonstrating that drug costs were the primary cause of increased drug spending. In fact, a vice president at Express Scripts referred to the drug price increases as “unprecedented and unsustainable.”
Specialty drugs, which often require careful handling, administration, or monitoring, saw a dramatic 30.9% increase in spending. As mentioned earlier, spending on hepatitis C treatments was the primary driver in overall spending, skyrocketing by 742.6%. Other notable (though nowhere near even 100%) increases include 20% for oncology drugs, 24% for treatments for inflammatory conditions, and 17% for hemophilia drugs. It’s not uncommon for these medications to cost many thousands, even tens of thousands of dollars per month. Sovaldi, a hep C drug, costs $1,000 per pill. We covered the Sovaldi saga in depth.
The story for traditional medications, such as those commonly used to treat asthma, depression, diabetes, GERD, high cholesterol, and pain is much more mixed. Despite drug prices rising by 6.4% overall, prices dropped for five out of ten therapy classes. Depression medication prices, for example, plummeted by 18%. Interestingly, the report noted compound drugsas a therapy class, even though they treat a variety of conditions. These drugs had an unusually large price increase of 128%! Excluding compound drugs, drug prices for traditional meds were up only 2.3%. (more…)
Tagged with: AbbVie, Express Scripts, Gilead Sciences, Harvoni, Hepatitis C, Sovaldi
(Read Part 1 and Part 2)
Last year we discussed the cost of hepatitis C (“Hep C”) wonder drug Sovaldi for Americans paying in cash or using their health insurance. Notably absent, in both analyses, were how our most economically challenged citizens could afford the $84,000 treatment. According to Governing, “Many of the estimated 3.2 million people living with Hep C in the United States are poor, imprisoned or elderly, which means the cost of Sovaldi falls disproportionately on Medicaid and Medicare.”
To treat every one of the 750,000 Americans with Hep C who receive state-funded treatment through Medicaid or the prison system with Sovaldi would cost $55 billion, according to Express Scripts, and budget realities mean that that simply won’t happen. Public health officials will use prior authorization guidelines in determining who will be covered, similar to the way benefits administrators with private health plans determine eligibility.
Unlike private insurers, drug manufacturers must give Medicaid a 23% discount. The lower price is helpful but does not necessarily make Sovaldi affordable. Current models of drug pricing under Medicaid are not tailored to handle Sovaldi and other specialty medications. According to a letter sent from National Association of Medicaid Directors, “Simply put, the federal Medicaid statute is not designed to allow states to respond to this new pricing approach for pharmaceuticals. Sovaldi is just the first of many such exceptionally high-cost ‘curative’ specialty drugs.”
That letter recommends several federal policies to address Sovaldi and other high priced medications, including the creation of a special federal fund for specialty meds, similar to Ryan White federal funds for AIDS; additional rebates for specialty medications that reach a certain threshold in the percent of the population affected; and, my favorite because of the ludicrousness of international price disparities where U.S. prices are twice the average of other rich countries, “Modify the ‘best price’ policies for breakthrough drugs to include the selling price in other countries.”
There are more suggestions by the NAMD, and they are good future possibilities, but we’ve got to get down to the bottom line here: if you have Medicaid, then under what circumstances will you get Sovaldi? The states are all over the place in terms of coverage policies, but usually a person has to be very sick to get Sovaldi!
The Sovaldi Squeeze, written for Medicaid Health Plans of America (MHPA) by Viohl and Associates, takes a good stab at identifying Medicaid coverage policies. Thirty-five states require prior authorization. Most, if not all, of those states require enrollees to take a liver biopsy; the results of which determine whether or not Sovaldi will be covered. Some states will only cover someone who has not used illicit drugs and alcohol for three years. Other states, including Illinois, Florida, and Louisiana will limit coverage terms to make sure the patient is complying properly with the regiment. For example, Louisiana will only cover Sovaldi for 28 days at a time.
The most extraordinary criterion I saw is referred to as the “once in a lifetime” rule in the MHPA report. As you imagined, if a patient doesn’t adhere to their covered Sovaldi treatment then it won’t be covered again.
Like we discovered with private health insurance and certainly for people who must pay the full price in cash, there are serious obstacles to obtaining Sovaldi even if you’re covered on Medicaid. The costs are just too prohibitive. Yes, Gilead is right that unlike maintenance medications Sovaldi (and other new Hep C meds we’ll discuss below) can cure the patient, which means lower healthcare costs overall. Nonetheless, the market is not established to handle such insane upfront costs.
You might expect that more treatments with the curative-type power of Sovaldi would add competition to bring down prices. Indeed, there are three new Hep C specialty meds on the market. Olysio, marketed by Jansen is cheaper than Sovaldi, but still sells for $840 per pill. Harvoni is actually more expensive than Sovaldi, carrying a price tag of$94,500 for three months, about ten grand more than Sovaldi. Unfortunately, like Sovaldi it is made by Gilead so the competition factor is diluted! Harvoni does have the advantage of being a stand-alone treatment, however, whereas Sovaldi is taken in conjunction with ribavirin.
Viekira Pak, marketed by Abbvie, was approved just last month. Express Scripts wisely decided to make a deal with Abbvie that it would exclude Sovaldi in exchange for lower prices on Viekira Pak! Sure enough, Gilead fought back against Abbvie by making a deal with CVS Health that Harvoni and Sovaldi would be the preferred Hep C medications for CVS’ PBM business.
And which drug is the best? We’re not going to touch on that but the online magazine, Hep Mag, has an excellent summary on all the new Hep C medications discussed above, which could prove helpful.
The market dynamics for Sovaldi and other breakthrough medications like it are highly complex but largely stacked in favor of pharmaceutical company profits against taxpayers and consumers. Neither Medicaid nor private health insurers can afford to treat the millions of people who are infected with Hep C.
To conclude, I’ll leave you with the words of Caroline, who commented on our Part 1 post about paying for Sovaldi in cash, as she sums it all up perfectly:
Tagged with: Gildead Sciences, Harvoni, Hepatitis C, medicaid, Sovaldi
“Well I’m insured but this medication is not on the formulary for either health care companies offered at my job. They are two well-known companies and according to my GI doctor, none of the insurance companies are approving this drug unless you are at least at stage 3 liver disease. So I’ll have to get a little sicker before I can get it. Thanks Gilead!”