U.S. prescription drug prices are not the envy of the world

This month we are looking at pharmaceutical prices in the United States. Why are they so high? Do they have to be so high?

Research shows drug costs in the United States are twice as high as in other modern, prosperous countries. Those same countries are using the same drugs as we use in the United States and have healthier populations. What is going on? The answer is straightforward. All those other modern countries are negotiating the price of drugs used in their health systems.

Healthcare Focus

By Mark Brakke

Let’s look at a common medical product — the epinephrin injector, commonly called an EpiPen. Epinephrine injectors are used to treat life-threatening allergic reactions. The epinephrine in the injector is worth one to two dollars. The injectors cost is in the five-dollar range. However, a two-pack (two injectors) of brand name EpiPens retails for between $341 and $690. The generic version retails around $109. That is a hefty profit margin.

Let’s also look at insulin — a life-saving drug essential for many. It was isolated in 1921 by two Canadian researchers who gave the rights to their university with a written agreement the university would not allow a single company to monopolize the discovery. Since 1921, much progress has been made isolating animal insulin for use in humans; and more recently, learning how to make human insulin in a factory and how to modify human insulin to achieve certain characteristics. What is the current cost of factory-produced human insulin? A commonly-used insulin “lispro” is about $96 in the United States compared to $9 in Sweden (https://aspe.hhs.gov/sites/default/files/ migrated_legacy_files/196281/ Comparing-Insulin-Prices.pdf). The cost in other modern, prosperous countries is similar to Sweden.

The pharmaceutical industry is selling prescription drugs in foreign countries at a much lower cost than in the United States and still making a profit. Good for other countries residents, not so good for U.S. residents.

The fundamental fact is that no individual or single business in the United States is big enough to negotiate reasonable drug prices.

The pharmaceutical industry has opposed having Medicare negotiate drug prices for years. In 2022, a tiny step was taken to allow Medicare to negotiate the price of a few prescription drugs paid for by Medicare … but not until 2028! The pharmaceutical industry is one of the biggest spenders on lobbying. In 2021 the pharmaceutical industry spent about $100 million lobbying Congress — an amount similar to what is spent on lobbying by the defense industry.

Let’s look at one of the arguments the pharmaceutical industry uses to oppose lower prices. They say we will get fewer new drugs if they make less money. History, fortunately, tells us this argument is not valid. The researchers work in this field because they are curious and desire to help their fellow man. The discoverers of insulin made sure their initial discovery could not be monopolized by a single company. Dr. Jonas Salk, the inventor of the first effective polio vaccine, did not patent it for his personal profit. Most basic research which leads to new drugs occurs in universities, not in commer- cial labs. Furthermore, that basic research in universities is usually funded by our tax dollars. The pharmaceutical companies typically follow the basic research being done in universities and when they see a promising discovery they take steps to buy the rights and commercialize the product. Negotiating better drug prices will not shut off good research.

I want to be clear I am not against private enterprise. I am against the individual citizen being unfairly taken advantage of by unreasonable profit seeking. You or I as an individual cannot walk into Eli Lilly and negotiate a better price for our medication. U.S. residents have as much right to sensible drug prices as do others in our world.

Let me use the Dutch as an example. The Dutch health system effectively negotiates drug prices and the result is their prices are one-third those in the United States. How healthy are the Dutch? Take a look at life expectancy: the Dutch — 81.4 years; the United States — 77.2 years. They are getting the same good drugs we are at a fraction of the cost.

As we all know, complaining about problems does not fix those problems. Big problems require similarly big solutions. Our costly health care mess is an instance where we as voters need to let our legislators know this should be fixed. In Minnesota, Senator John Marty’s Minnesota Health Plan is designed to insure everyone — and do it at a lower price than we now pay. At the federal level, Representative Pramila Jayapal’s “Medicare for All” bill takes a similar approach.

You can read about Senator Marty’s bill at https:// mnhealthplan.org.

Mark Brakke is retired after caring for patients in Coon Rapids, Minn. for 41 years. He has served on boards of two HMOs. Questions relating to health care can be sent to editor@thelandonline.com. v