Source: NY Daily News
Prescription drugs have long provided two bad examples of American exceptionalism. They cost three-to-four timesĀ moreĀ than anywhere else, and weāre one ofĀ only two countriesĀ in the world that allows consumer advertising of the drugs.
Letās return to being unexceptional. Americans deserve drug prices in line with those in other countries. They donāt deserve a constant barrage ofĀ confusing and misleading ads.
Advertising is the lesser of two evils and the simplest to counter: Just stop it already. Important voices have already made that recommendation.
TV commercials for prescription drugs always tell consumers to āask your doctor.ā But the companiesĀ that pay billionsĀ to run the ads arenāt listening to doctors. For the last five years, the American Medical Association hasĀ called for a ban on direct-to-consumer advertising of such drugs.
Hereās what the drug makers are ignoring: ā[The AMAās] vote in support of an advertising ban reflects concerns among physicians about the negative impact of commercially-driven promotions, and the role that marketing costs play in fueling escalating drug pricesā¦.Direct-to-consumer advertising also inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.ā
New Zealand ā theĀ lone other countryĀ that permits such advertising ā could soon disallow it. A large majority of New ZealandersĀ favor a ban, and one might be included inĀ a billĀ now being considered. Its passage would make America truly exceptional in a drugged up way.
Cutting drug prices presents a bigger challenge than cutting out drug advertising, but the rewards would be huge.
Americans will spendĀ over $500 billionĀ on prescription drugs in 2020 (more than 2.2% of gross domestic product). The basic research underlying these drugs isĀ almost alwaysĀ carried out with taxpayer dollars at university or government research labs, mostly through the National Institutes of Health.
The research findings used to stay in the public domain, available to any company that wanted to use them. In 1980, the bipartisanĀ Bayh-Dole ActĀ made a watershed change: It allowed for the rights to be turned over to private parties.
While the point of Bayh-Dole was to hasten the harnessing of basic research, it also sent the price of drugs soaring. Spending on prescription drugs had beenĀ largely stableĀ at around 0.4% of GDP from 1960 to 1980. In the decade after Bayh-Dole, it had doubled to 0.8%, and it doubled again in the next decade.
We now have this bizarre mindset that we have to give drug companies patent monopolies to get them to develop drugs or vaccines, even when the government is paying for the bulk of the research. The pandemic is showing the absurdity of this practice.
As one example, Gilead Sciences developed the drug remdesivir, largely with government funding, as a treatment for Ebola. While it turned out not to be an effective treatment for Ebola, it is somewhat effective in treating the coronavirus. Gilead is charging private insurers $520 forĀ a single vialĀ of remdesivir. Its actual production cost has been estimated at less than a dollar a dose.
The Trump administration is taking the same logic to developing a vaccine.Ā Operation Warp SpeedĀ is a $10 billion government program to develop, produce and distribute a coronavirus vaccine. At least four Warp Speed contracts (to Janssen, Regeneron, Genentech and Ology Bioservices) exclude standard language āmeant to ensure that products developed with federal funds are affordable and widely available.ā
In effect, the government is putting up most of the money and taking the big risks. If one or more of these developers hit a dead end, they will still have been paid for their work; the government is out the money. But if they succeed and develop a life-saving vaccine, the government will give them a patent monopoly and allow them to charge whatever they want, with no restriction whatsoever.
It shouldnāt be too radical a proposition to say that drug companies only get paid once. When the government pays for the research, the drugs or vaccines developed are in the public domain, so they can be produced and sold by anyone as cheap generics.
It would be a great thing for humanity if a low-priced coronavirus vaccine became the first example of a new prescription drug policy in America.
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