Recent cost increases of up to 5000% for specialty drugs have sparked outrage and a new debate on the ethical grounds of the rising price tag of common pharmaceuticals used to treat various, and often deadly, diseases in the US – as well as the responsibility of insurance companies to cover these exceedingly high costs.
The progressive inflation has resulted in a lawsuit filed against Anthem last month in Los Angeles, as one of the millions of hepatitis patients attempt to fight back against huge pharmaceutical companies who radically raise prices and insurance groups who refuse to pay, or set guidelines for payment that many deem unethical. The lawsuit for breach of contract, among other complaints, centers on the fact that the cost of new hepatitis C drugs — Sovaldi and Harvoni, both developed by Gilead Sciences – can cost anywhere from $84,000 to $100,000 per patient, for a 12-week treatment plan.
The complaint states that Anthem Insurance is increasing its profits through obstructing her liver specialist’s plan of treatment, by finding it medically unnecessary, and only approving payment for patients who have advanced liver disease – regardless of the fact that most physicians prescribe the drugs as the standard of care for hepatitis C patients. The plaintiff can’t believe it has come to this, saying “How Anthem can determine that it’s not medically necessary for me is mind-boggling.”
Gilead makes the point that Medicaid programs receive a discount but, according to the Department for Medicaid Services chief medical officer, Dr. Langefeld, “It doesn’t do much to offset the significant price tag associated with these very useful drugs.”
Murray Ross, director of the Kaiser Permanente Institute for Health Policy in Oakland explained why he’s not so shocked about this new price increase, saying “There’s been a long tradition of the medical profession trying to step out of the cost and pricing discussion. This drug has forced the hand because of where the prices are – we like to think we have a free market system but it really isn’t. Manufacturers have substantial pricing power, and buyers have very little ability to avoid that. You can negotiate down from the manufacturer’s suggested retail price, but you’re still left with a large number.”
And, unfortunately, the responsibility of payment typically ends up on the other members of the patient’s health-insurance plan, which ultimately leads to higher premiums — or taxpayers cover the bill for patients who qualify for government health care coverage.