Monday, August 11, 2014

From Health Care Renewal: The Free Market and Drugs

Let's see what's going on over at the Health Care Renewal blog, courtesy Dr. Roy Poses.

Dr. Poses has been noting that there are some pharmaceutical developments that could easily help us out in the case of Ebola virus, which seems right now to be expanding its presence and going out of control in West Africa. Unfortunately, while new vaccines and other drugs could be helpful (even if drug treatment is a small part of the immediate response to the deadly virus), the world's pharmaceutical industry has largely tuned out. From a capitalist standpoint, this is simply not an attractive investment. Not enough people with enough cash in their pockets are at risk for coming down with Ebola to make it profitable for any company to develop the necessary drugs.

Dr. Poses has been comparing the real human needs posed by Ebola virus with the made-up needs which are met, at great profit, by the drug industry. His latest case is Acthar gel, an obscure drug made from pigs' pituitary glands. The use of this drug, made by Questcor, has grown more than 20-fold between 2008 and 2014, reaching about $220M on Medicare. (Notice that as a million- and not a billion-dollar drug, Achtar is not even on many people's interest lists.)

Here's Dr. Poses' summary of this drug and its implications:

  The sorry case of Questcor and Acthar reveal how crazy the costs of health care in the US have become, driven now by a system that itself now seems crazy.  Through clever use of regulatory loopholes, the company acquired rights to an old drug whose efficacy was unproven, hugely increased its price, began aggressive marketing even though the drug's efficacy was completely unproven, while remaining largely silent about the drug's substantial risks.  Fueled by hundreds of millions of dollars in revenue thus generated, mainly from the US government, the company richly rewarded its top hired executives, who then have decided to sell it to a company outside of the US in a deal that will make these executives millions more.  So patients received a drug whose benefits are unknown, and whose risks may be much higher than they were told, at a cost of hundreds of millions of dollars, much of it borne by US taxpayers, while company executives got rich.

 Just coupling for now the story of how we spent hundreds of millions on Acthar to enrich company executives with the story that we have no money to develop vaccines or treatments for Ebola virus... demonstrates the massive failure of our experiment to turn our health care system over to market triumphalists and laissez faire mercantilists.  As long as we let the health care system be run by people who put their own enrichment ahead of patients' and the public's health, things will only get crazier.

Dr. Poses also added that many of the docs who are busy prescribing this questionably-useful drug to their Medicare patients are being paid by Questcor. He noted that if a proposed sale of Questcor to Mallinckrodt goes through, 6 top execs at Questcor stand to make an additional $63M. So they have every reason to portray Acthar in a solid light, and particularly to hide any ill effects caused by the drug.

Meanwhile, there's Ebola, for those silly enough to be worried about such things.

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