Wednesday, February 10, 2010

Big Pharma's Sacrifice for Health Reform--Not

Today's Houston Chronicle features a hard-hitting editorial--

--detailing a number of important facts about recent increases in drug prices. (While the cost of drugs, and the doings of the drug industry that do not directly affect relationships with the medical profession, are generally beyond the purview of this blog--to be brief, industry-bashing is not what I try to be about--there are times when the issues overlap and when we need an update about general industry behavior.)

Specifically, the Chronicle states that if there ever was any perception that the drug industry was stepping up by agreeing to support health reform and to agree to moderate future price increases as its contribution to the need to cut medical costs, that posture has been revealed as an empty facade. The figues are: proposed future savings of $8B annually; recent runups in drug prices in advance of any future savings due to possible health reform, $10B annually; net result, $2B annual extra profits for Pharma rather than any real reductions in the price of drugs.

The editorial continues by noting that Congress is increasingly exasperated with this game and is now proposing to add legislation that will limit "pay-for-delay," the industry practice by which the brand-name company pays off the generic company to postpone the arrival of a lower-cost generic on the scene once a drug patent expires. (Ending this practice, says the FTC, could save consumers $35B over the next decade.) In response, the industry is now threatening to withdraw completely from its support for health reform. Sounds like they want the entire $10B a year, rather than having to pay back the $8B they promised.

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