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pharmaceutical industry


If you’ve ever had a prescription filled in the United States, you’re aware that American drug prices can be ridiculously high. But some drugs are pricier than others — and health insurance providers are fighting back.

The recently released prescription drug Solvadi (sofosbuvir) is a case in point. Solvadi is the only cure for hepatitis C, a liver infection that can lead to cirrhosis, liver cancer, liver failure and ultimately death. You’d think this drug would be a godsend for the many patients struggling with hepatitis C — until you got a look at the price.

pills-on-hundred-dollar-bills-health-care-insurance-money-prescription-drug-pricesSolvadi costs a staggering $1,000 a pill, or $84,000 for a full, 12-week course of treatment. Other specialty drugs, like those used to treat rheumatoid arthritis, cancer and multiple sclerosis can cost patients an average of $10,000 a month. Even drugs for more common conditions can be prohibitively expensive for most people, which is why many Americans turn to online pharmacies like Medicines Mexico to cut their prescription drug costs.

Health insurance providers say drug prices that high simply can’t be borne. Many insurers are now refusing to cover the costs of expensive drugs at all, at least in cases where the drug’s perceived benefit doesn’t justify its price, or there are other drugs available that do the same thing for less money. Patients will be forced to use similar drugs with lower price tags.

Prescription Drug Access Is a Problem for Many Americans

Prescription drug sales topped out at $326 billion in the 12 months prior to September 2013, and Americans’ prescription drug spending is expected to grow by three to five percent by the end of 2014. The high price of prescription drugs is to blame, and physicians around the nation are aware that, for most people, affording prescription drugs is difficult, especially when it comes to obtaining some of the most expensive treatments.

Jerry Avorn, a Harvard Medical School professor and chief of the Division of Pharmacoepidemiology and Pharmacoeconomics at Brigham and Women’s Hospital, told CNBC, “Access really is a problem for a lot of patients in relation to these very costly medicines. We sometimes think, ‘Well, people have insurance, and under Obamacare there’s a lot more coverage,’ but what that doesn’t take into account is that very often there is a very big co-payment that the patient has to come up with that is often many, many hundreds or thousands of dollars.”

In 2012, Memorial Sloan-Kettering Cancer Center chose to stop prescribing the costly cancer medication Zaltrap (ziv-aflibercept) on the grounds that the drug didn’t provide any additional benefit over older drugs, despite its substantially higher cost. In response, the drug’s French manufacturer, Sanofi, cut the price of Zaltrap in half.

Insurers Forcing Drug Price Negotiations

While the U.S. Centers for Medicare and Medicaid services are prohibited by law from attempting to negotiate lower drug prices, health insurance providers are not. With rising health care prices affecting everyone, insurance providers are now giving pharmaceutical manufacturers a choice. Either drug manufacturers can slash the prices of their most expensive drugs, or insurers will remove those drugs from their formularies. A drug not listed in an insurance provider’s formulary won’t be covered under any plans — patients who want it will have to pay full list price out of their pockets.

Of course, health insurance providers aren’t going to dump drugs just because they’re expensive. If there’s no equivalent drug available yet — such as in the case of Solvadi — insurers will likely still cover it regardless of cost. But patients are already being asked to switch to less expensive equivalents of the medications they need — CVS Caremark dumped around 30 expensive drugs from its formulary in 2012 and 70 more this year; next year’s formulary will exclude 200 drugs. Express Scripts dumped 48 drugs and medical products this year. A new Catamaran formulary is 54 drugs lighter this year. Some of the drugs dumped include popular prescriptions like Advair (fluticasone/salmeterol) and Victoza (liraglutide).

So far, American drug manufacturers haven’t responded by lowering the prices they charge insurance companies. Nor will the strategy affect list prices, the prices paid by patients who must buy their drugs out of pocket, without help from an insurance provider. List prices will remain the same. Instead, insurers hope that by dumping costly drugs or forcing manufacturers to bargain, they can keep premium costs low.

Drug prices are astronomical, especially for some specialty drugs used to treat cancer, hepatitis C, rheumatoid arthritis and multiple sclerosis. Insurance providers, in a bid to keep premiums manageable, are dumping expensive drugs by the dozens. Unless drug manufacturers decide to start bargaining with insurers, patients will find their prescription drug options dwindling by the year.


British pharmaceutical giant GlaxoSmithKline (GSK) will investigate allegations about its conduct in Iraq, nine months after an inquiry into the company began in China.

We are investigating allegations of improper conduct in our Iraq business,” a GSK spokesman said.

“We have zero tolerance for unethical or illegal behavior.”

GSK will investigate allegations about its conduct in Iraq, nine months after an inquiry into the company began in China

GSK will investigate allegations about its conduct in Iraq, nine months after an inquiry into the company began in China (photo Reuters)

GSK will investigate claims that it hired 16 state-employed doctors and pharmacists as paid sales representatives at a time they continued working for the government.

The allegations, which date back to 2012, were sent to the company late last year, the Wall Street Journal reported.

They allege that GSK paid for the doctors’ expenses to attend international conferences, and that it pays other doctors high fees to give lectures in exchange for promoting its drugs.

The emails were from someone familiar with the company’s Middle East business, said the report.

“In total, we employ fewer than 60 people in Iraq in our pharmaceuticals operation and these allegations relate to a small number of individuals in the country,” GSK said.

Last summer, GSK said senior executives in its China office appeared to have broken the law amid a bribery scandal.

The acknowledgement came as GlaxoSmithKline said it was co-operating with a Chinese investigation into alleged bribing of doctors to prescribe the company’s drugs.


An anonymous author who works in the pharmaceutical industry wrote several anonymous editorials in this weeks British Medical Journal in which they claim:

“Some of the [post-marketing] studies I worked on were not designed to determine the overall risk/benefit balance of the drug in the general population. They were designed to support and disseminate a marketing message.”

According to the writer the process begins as doctors are recruited to find patients who will demonstrate the best results for the company. The doctor is told exactly what to tell patients they should expect and that information is meant to plant the seed of support in the patients mind.

What’s worse, the whistleblower claims that the studies are often molded to fit the expectations of the drug company.

“We occasionally resorted to <<playing>> with the data that had originally failed to show the expected result,” he says.

“This was done by altering the statistical method until any statistical significance was found.”

Drug maker employee claims the company is falsifying study results to sell its products

Drug maker employee claims the company is falsifying study results to sell its products

Negative results are then omitted when it comes to harmful side effects since post-marketing studies do not face the same public scrutiny of pre-approval studies.

The other notes that the false reports are based on a company’s desire to make money over the ten-year period in which their drug is under control of strict patent laws.

Nature examined the authors work and believes they may come from a diabetes background as the editorials focus on post-marketing studies involving insulin drugs meant to fight diabetes.

News of bait-and-switch campaigns involving “post-marketing” studies are nothing new, researchers for years have complained about these so-called “studies” which attempt to overturn accepted problems with drugs that were discovered in pre-study tests.

In the meantime, the companies involved in the authors attacks such as Norvo Nordisk continue to stick behind their products, claiming that their studies involved real-world case studies.