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International Pharmacy Drug Price Transparency Hits Pharma in the Gut

Drug Price TransparencyAs announced by HHS Secretary Alex Azar, the Trump administration is planning to force drug companies to include prices in their advertising. That means that, along with the long list of drug side effects that you hear during a TV ad, you’ll see the list prices. That list price is referred to as the wholesale acquisition cost, which is around the cash price you’d pay without insurance. Prices would have to be included in all ads for drugs covered by Medicare and Medicaid (i.e. pretty much all drugs).

I don’t particularly love this idea, but it is better than nothing.

The goal of this policy is to control drug prices by making them more transparent. Sound unlikely? It has a noble free market, pro-consumer ring to it, which I kind of like. It will be fun to see how this plays out, but it’s a minuscule policy move that won’t bring the kind of drug price relief that Americans want and need. In the proposed rule, Azar, or whichever of his staff wrote it, is all high and mighty about transparency and market efficiency:

“Markets operate more efficiently when consumers have relevant information about a product, including its price, as well as alternative products and their prices, before making an informed decision whether to buy that product or, instead, a competing one.”

At PharmacyChecker, we know a lot about the importance of drug price transparency. That happens to be one of the things we’re best at (along with verifying pharmacy practice standards). Our recognized forte is international pharmacy drug price transparency.

Here’s a scenario for you:

In this future world of Azarian drug price transparency, Jorge from Brooklyn will be watching the baseball game (maybe the Yankees in the World Series next year), and he’ll see an ad by Merck for the drug, Januvia. Jorge has just learned he has Type 2 diabetes and has a prescription. He’ll hear that Januvia can help lower his blood sugar, which is good. Then, he’ll hear that the side effects could include joint pain, a skin reaction requiring treatment in a hospital, and even death from pancreatitis. He gets that all these ads have to list those side effects.

Then he hears: it’s $550 for a one-month supply; but, wait, it will likely cost much less with insurance! That doesn’t exactly help. Jorge is one of 30 million uninsured Americans, and $550 is more than he can afford after paying his rent, groceries, gas bill, his daughter’s ballet classes, and his son’s asthma inhaler. Yes, he’ll hear there are Januvia patient assistance programs that might be able to help. Let’s hope so…because people often don’t qualify.

There’s no generic competition for this drug in Brooklyn. Unlike generic drugs, you can’t pharmacy hop for the best price or find a significantly lower U.S. price on the web. So what good is that transparency other than a minor slap on the hand to Big Pharma?

45 million Americans didn’t fill a script in 2016 because they faced similar situations to Jorge.

But there’s hope! When my fellow Americans visit www.pharmacychecker.com, they are blown away that the price of a drug is almost nine times higher in the U.S. than in Canada – and, yes, I mean Canada (not India or Turkey, where drug prices are even lower, and for the same drug).

On our website, Jorge learns that brand-name Januvia is $270 for a three-month supply if he orders it from Canada. Now that’s Drug Price Transparency! It’s a massive punch to the Big Pharma gut.

Januvia Prices in the U.S. vs. Canada

Drug U.S. Price Canadian Online Pharmacy Price Savings
Januvia 100 mg $1,593.90 $269.94 83%

Canadian pharmacy prices among verified international online pharmacies in the PharmacyChecker Verification Program are ones he can afford. If he cannot, then those same online pharmacies may also refer orders to pharmacies outside of Canada, which may have even lower prices.

Azar’s proposal shows just how vulnerable Americans are

To the credit of Azar’s proposed rule, it at least identifies how incredibly vulnerable Americans are to drug prices.

  • Uninsured paying cash prices
  • Insured finding that PBM formularies don’t cover all drugs
  • Insured finding they must pay co-insurance of 30-60% (not just copays) on really expensive drugs (in the many thousands per month)

These coverage gaps affect tens of millions of people each year, which is why we have a crisis. Making drug companies note the price in TV ads while leaving the patient powerless to do anything stinks.

Interestingly, one drug company, Johnson & Johnson, warns that this is a bad idea because people might end up not taking their prescribed medications. The Onion couldn’t do better than this. It’s not The Onion, though. It’s Bloomberg: J&J Says Putting Drug Prices in Ads May Scare Away Patients.

From the mouth of Big Pharma…

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New FDA Tests Indicate Imported Drugs Are Safe

FDA Testing Lower-Cost Imported Medications

Tens of millions of people have bought medications from foreign pharmacies – despite the technical illegality of importing those medications. According to reporting by Kaiser Health News last month, the FDA tested imported medications, apparently to see if what Americans are doing is safe. All medications the FDA tested “contain[ed] the ingredients matching the medicines ordered.”

The Kaiser Health News reporting was focused on international pharmacy options offered by local governments, schools, and other self-insured organizations. While that’s interesting, it’s not breaking news (I mentioned it here). The FDA testing imports and saying the medications are safe, albeit begrudgingly, is breaking news. (more…)

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