A few weeks back, I wrote about the House Ways and Means Committee international drug price report, which very competently compared U.S. patented drug prices with 11 other countries. The report found that 79 drugs, ones that account for 60% of Medicare drug spending, are on average priced just under 75% lower internationally vs. the U.S. when looking at ex-factory, meaning wholesale prices.
I half-joked that the Committee was recommending looking abroad for lower drug prices. They were not focusing on drug importation. However, the Committee held a hearing yesterday in which foreign drug prices were central to the debate. The focus of the hearing was a bill, H.R. 3, Lower Drug Costs Now Act, which seeks to lower drug prices in Medicare by empowering Medicare to negotiate with drug companies prices on certain, generally very expensive drugs. There’s a backstop in the bill if the drug companies won’t negotiate in which drugs would be priced at 120% of the average price of six high-income countries. That’s called international reference pricing. The bottom line here is that Congress is now shining a bright light on how much more expensive the “same” drugs are in the U.S. vs. abroad.
The FDA has finished draft guidance on one of two of the
Trump administration’s drug importation policy ideas, referred to as Pathway
II. The title of this post may seem like a joke for those of you who follow the
issue of drug importation in America, but it is real. As a reminder, in August 2019
administration took its support for drug importation a step further by
stating its willingness to support state drug importation programs, Pathway I,
and a new idea to give drug companies greater flexibility with their global
drug supplies to offer better prices in the U.S, called Pathway II.
Earlier this week, the guidance on Pathway II was sent to
the White House Office of Management and Budget (OMB), although I believe it’s
not public yet. I found out about the submission to OMB here (BioCentury). It doesn’t relate – at least not
directly – to personal drug importation, but it frees the hands of drug
companies to sell their own foreign versions of FDA-approved drugs at lower
prices in the U.S. market. Its indirect relation to personal drug importation
is noted at the end of this post.
Some of this is guesswork. It’s not entirely clear to me
what drugs are permissible under Pathway II and it won’t be until the draft
guidance is made public.
I’m proud to share that PharmacyChecker has published a white paper that
examines prices and availability of newly approved generic drugs. Our report,
based on 40 generic medications that were approved from 2017-2018, clearly
shows that generic drug approvals often don’t lead to greater affordability or
even access here in the U.S. We were inspired to examine pricing in addition to
availability after seeing availability research conducted by Kaiser Health News (KHN).
The KHN article concluded that the lack to generic availability in the U.S. “means
thousands or even millions of patients have no option beyond buying branded
drugs that can cost thousands of dollars per month.” As an option for those who
cannot afford that, PharmacyChecker found that 25% of the generic medications
were available online, internationally through pharmacies that are accredited
in the PharmacyChecker Verification Program.
Out of 40 generic medications that
were approved from 2017 to 2018, PharmacyChecker research found the following:
I’ve recently been exercising bragging rights about our new and improved drug price comparisons. Americans seeking medicine from Canada and other countries are finding better deals on generics right here at home. But the crisis of high drug prices in the U.S. persists when it comes to brand medications. Recent price research by the Journal of the American Medical Association shows that brand name drug prices have increased by 76% over just the past six years.
This week, PharmacyChecker released new price analysis
savings for 10 popular patented drugs, comparing U.S. discounted medication
prices with those available at accredited international online pharmacies. The
average discount from Canadian pharmacies is 75%. If ordering from farther abroad,
That’s right, folks. There’s no need to buy online and import from Canada, or even from India, to save money when it comes to most commonly dispensed generic drugs.
researched prices of the 40 most commonly dispensed generic drugs in the
U.S. to compare them to ones offered at accredited pharmacies in Canada. Four
of the generics are controlled drugs, which are not available to U.S. consumers
from PharmacyChecker-accredited international online pharmacies; and two of
them are not available in Canada. Out of
the 34 drugs we compared prices on, 88% were cheaper in the U.S. than in Canada
and at an average savings of 68%.
Forcing price transparency in drug ads, proposing international reference pricing for Medicare Part B, and even drug importation can all be found in President Trump’s lunchbox of policy ideas to take on the drug companies, who are “getting away with murder.”
Huh, am I dreaming?
Is Donald Trump really a Republican? Is former Eli Lilly President Alex Azar, now HHS Secretary, really advocating such radical ideas, such as importation, against his pharma friends? Scott Gottlieb, our free-market fanatic FDA Commissioner is crusading against high drug prices, too: winner of Patients for Affordable Drugs Price Fighting Hero Award!
Pinch me. Am I awake?
I am awake and I’m not fooled by this subtle, probably well planned out public relations defense against the progressive and populist tide, which includes Republicans and Democrats. Forget importation this week: 92% of Republican and 96% of Democratic voters support ending the ban on Medicare negotiating drug prices. Finally, the country is united!
Ending the ban on Medicare price negotiations could bring down prices for drugs in all of Medicare.
But Alex Azar’s proposal to reduce drug prices in Medicare
is only for Part B, half the country, and on a small group of medications.
Forcing drug companies to list prices on TV drugs ads does not bring those
prices down. And the importation
idea is good, but super limited, and it’s still just talk!
“If one was to design a program that appeared to address the need to curb high prices for drugs, without doing much in Trump’s first term, and promising nothing after 2025, it might look like the proposal.”
On the other hand—and this is where compromise begins to seep in and you can’t help but know it’s because Trump is no normal Republican—the former President of Eli Lilly USA, Alex Azar, is advocating for forcing price reductions on drugs in Medicare Part B and importing foreign versions of lower-cost medications for single source drugs; and working in an administration giving voice to drug price transparency. Who would have thought that possible two years ago?