Why, Oh Why, Are My Pill Bills So High?

Unsurprisingly, it’s because of drug companies. But Consumerist, you ask, why would drug companies try to keep the prices of drugs artificially high? And how would they do it?

According to Consumer Reports Drug Companies have several tactics for delaying the release of generic drugs into the marketplace.

Here are a few of them:

Legal Hassles: The FDA allows any person or company to file a citizen petition challenging generic-drug approval. Drug companies exploit the system by filing frivolous complaints. These complaints delay the approval of the generic and the drug company remains the only game in town. Neener, Neener.

Bribes: Brand-name drug companies bribe generic-drug companies to stay out of the market. Who wouldn’t want to get paid to do nothing?

The Walmart Technique: Drug companies repackaging their own products and going head-to-head with existing generic manufacturers, muscling them out of the market by reducing profit margins until there is really no point.

This is the sentence where we’d give you advice about what to do, but there really isn’t anything. Ha-ha. Drug companies win again.

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  1. kerry says:

    Also, your drugs are so expensive because your insurance provider has deals with certain manufacturers and won’t cover similar products made by other companies. It sucked when I was on celebrex, then my employer-provided insurance changed to only covering vioxx, then vioxx got pulled off the market and they went back to covering celebrex and I had to keep getting new prescriptions to keep my flow of NSAIDS steady. Get a copy of your insurance company’s formulary and bring it to the doctor so you can be sure the prescription you’re getting will be covered.

  2. prodigal says:

    Also worth pointing out is that under the US’s Medicare system, the goverment cannot directly negotiate with drug manufacturers for lower prices.

    That bit was written in by whoever’s in Pfizer’s pocket, I assume. Yay free enterprise!

  3. magic8ball says:

    Hmm … on any given day I probably lean more toward capitalism than socialism, but I’m starting to wonder if it’s time for the drug companies to submit to a little more regulation. They are blatantly gouging the public in ways that not even Big Oil is allowed to do.

  4. What’s so annoying is that a lot of the most expensive drugs, like AIDS and cancer drugs, were developed using US Government research grants — that is, they were funded BY TAXPAYERS.

    And then they turn around and charge US citizens the highest prices for those drugs in the world BECAUSE THEY CAN because we’re almost the only first-world country whose government doesn’t regulate drug prices. Which is what makes the typical claim that they have to charge a lot to make enough profits to pay for R&D so particularly ironic and bitter.

    So to recap: We fund the development of the drugs through tax-funded government grants. Drug companies get the patents and the profits. Drug companies sell the drugs cheaper to every other country on the planet. The US citizens who paid to develop them get screwed on the prices.

  5. Spiny Norman says:

    Please remember that there are many medications in the formulary that do remarkably similar things. You can always ask your physician to indicate that a generic is acceptable. Don’t be afraid to ask your physician about alternatives to the medications he or she is prescribing for your condition. You can check on alternatives on your own at sites like WebMD as well. Information is the best defense.

  6. magic8ball says:

    I’m a big fan of generics, but drugs that do “remarkably similar things” are not always interchangeable. Example: my sister-in-law was taking antidepressants. She tried Prozac, but it made her jittery, so they switched her to Celexa. Celexa worked, but there was no generic available, so her insurance wouldn’t pay for it. Instead, they wanted her to take the generic for Prozac. When she told them she couldn’t take it, they basically said, “Well, too bad, we won’t pay for Celexa because there’s a generic available but you refuse to take it.”

  7. Please remember that there are many medications in the formulary that do remarkably similar things.

    But they don’t always have the same side effects. I changed one of my perscriptions about this time last year but had to change back to the more expensive brand because the side effects became too much.

    Go as cheap as you can but don’t make yourself even more sick if you can avoid it.

    So to recap: We fund the development of the drugs through tax-funded government grants. Drug companies get the patents and the profits. Drug companies sell the drugs cheaper to every other country on the planet. The US citizens who paid to develop them get screwed on the prices.

    Makes you wonder why we haven’t gone all French Revolution on them.

  8. chemman says:

    Drug companies are not the only reason for high costs. Our capitalist society allows for many “fingers in the pie”. There are large distributors that negotiate cheaper prices on drugs and mark them up to make their profit, which then sell them to pharmacies that mark them up yet again. If you shop around there are big differences between prices at pharmacies.
    Eyebrows-can you give one example of a drug that was fully developed by tax funded grants? According to most reports, the average cost to bring a drug to market is in the $500 to $800 million dollar range and a ton of that cost is due to government mandated requirements. There are grants for many of the most important and expensive types of drugs, but the government gives grants to every industry, including Microsoft, oil companies and many others that most could argue don’t really need it!
    The cost and availability of quality medications is a very complex issue with many layers to it, so to just blame the drug comapnies is a bit unfair. What about the high cost of liability when consumers sue companies for side effects of drugs? (every drug has side effects, some worse than others the risk vs reward needs to be weighed by the doctor and patient, aspirin can have some bad side effects depending on the person)

  9. juri squared says:

    magic8ball took the words right out of my mouth.

    I have allergy problems. I’ve been on a multitude of medications, but nothing worked as well as Zyrtec. However, my insurance refuses to cover it, saying that I should take over-the-counter Claritin instead, even though I took it when it was a prescription drug and it didn’t work.

  10. neveryoumindthere says:

    I work in Compliance at a to-remain-unnamed pharma company and I can attest that what chemman says about regulations is correct. It’s incredible the lengths that we need to go just to remain in barely within compliance – and every step of the way needs to be documented, verified, and then documented again.

    Remember, too, that for every “blockbuster” drug that many people take, there are scores (if not more) of drugs that are much, much less profitable – if profitable at all. The prices paid for blockbusters that many people want help subsidize the ones that comparatively fewer people need. Remember the “orphan drug” thing in the 80s? Well, your viagra prescription covers a bit of your neighbor’s exotic whatsit for which there is only one medication and only two patients per year.

    And, for every drug that makes it to market there are many, many compounds that seem promising at one stage but for some reason or another don’t make it all the way. All that research has to be paid for, too. It’s not free just because it didn’t go anywhere.

    But, yeah, there *is* a lot wrong with the system. My advice, though, is to start with insurance companies. They’re the ones charging crazy amounts of money just to move paper around.

  11. kerry says:

    Maybe some of the premium prices we pay for popular drugs help fund research for less popular drugs, but I wouldn’t be nearly so skeptical of pharmaceutical companies if their upper management weren’t taking so much money home with them. It’s just like oil companies – record prices and record profits, meaning record paychecks for the guys at the top coming right out of the consumer’s pocket. It’s enough to make me go all pinko.

  12. acambras says:

    Don’t forget about how hard they fight to keep Americans from importing cheaper prescription drugs (particularly from Canada).

    There is a special little corner of hell reserved for health insurance companies. I am so tired of having my doctors be second-guessed by NON-doctors in the employ of the insurance industry.

    Pure evil.

  13. Tonguetied says:

    That whole cheaper drugs from Canada stuff is really just a shell game that doesn’t scale up and is a de facto imposition of price controls on the sly.