Are Drug Companies Giving Us the Straight Dope on High Drug Prices?

(Chuck Muth) – President Trump, Congress and state legislatures across the country have been talking about the often ridiculously high cost of prescription drugs in the United States and what to do about them.

And while far too many people aren’t paying attention to this situation because their out-of-pocket liability is limited to paying a relatively small co-pay regardless of the drug’s full price, the rising cost for government health care programs such as Medicare and Medicaid could come back to bite all of us in the form of higher taxes.

For their part, pharmaceutical companies maintain the high prices are necessary to recoup the research done to identify and develop new drugs.  And it’s been an effective argument.  But is it true?

Well, according to a Johns Hopkins study published late last year, not exactly.

Now, I know that even though Johns Hopkins is a highly regarded research institute, some of you are out there saying, “Yeah, but what methodologies did they use to reach their conclusions?”  So here’s just a snippet to alleviate any doubts…

“PubMed searches were performed for each drug using an ontology of drug name synonyms in ChEMBL and the National Center for Biotechnology Information Query Translation.  PubMed searches for molecular targets were performed using Boolean search terms and NCBI Query Translation.  The PubMed Indentifier was recorded for each publication identified in the search.”

So there ya go!  Who could argue with that, right?

Fortunately, other parts of the study were written in plain, layman’s English.  And the bottom line is…

“This report shows that NIH (National Institutes of Health) funding contributed to published research associated with EVERY ONE (my emphasis) of the 120 new drugs approved by the Food and Drug Administration from 2010-2016.”

To the tune of…$100 BILLION!

And since NIH is a government agency that is taxpayer-funded, we all have a stake in this.

That money is primarily used for basic drug discovery research.  New drugs “are then transferred to the private sector for development,” including “obtaining regulatory approval, and establishing the manufacturing, control, distribution, and marketing required to commercialize” a new drug.

So yes, the pharmaceutical industry does have a skin in the game of bringing a new drug to market, but nowhere near as big a skin as its PR machine would have the public believe.

Again, as the study shows, it was the NIH and other academic institutions that funded and discovered these new, often life-saving drugs – all 120 of them from 2010-2016.  The limited role of and expense to the pharmaceutical companies was for the government approval process, manufacturing and marketing.

Now, if the pharmaceutical companies were paying for everything out of their own pockets, they’d have a strong free-market case for keeping the government out of it.  But since these companies are benefitting from a huge expenditure of taxpayer dollars,  sorry Charlie, but the public – through its elected representatives – deserves to have a say.

And to that end, in the next Muth’s Truths column I’m actually gonna give a tip of the hat to a very liberal Nevada state legislator (sort of).  Look for it tomorrow or Thursday.  In the meantime, protect your wallet by staying healthy!