Drug Prices: An Update
In my first blog entry some three and a half years ago (August 14, 2011) I mentioned that Lipitor is overpriced at $150 a month. Well, the patent on Lipitor has expired, and brand name Lipitor now costs $200 a month. I don’t recall inflation being so high in the last three years… do you? Fortunately, generic Lipitor is actually free if you subject yourself to a Medicare HMO called Blue Shield here in California.
The sad part is that when I went to get my generic Lipitor filled, there was an eighty-five year old man there getting his brand name Lipitor filled, and that is how I found out that the brand name drug has increased so much in price.
Any doctor who has studied the research will tell you that, at eighty-five, your average life expectancy is less than three years. Taking Lipitor (even the brand name) will extend your life, at that point, an average of about a week altogether. So this man was willing to spend $7,200 to extend his life for a week. Not bad, if you can afford it.
Actually, he looked pretty good, so maybe I’m exaggerating. Maybe he’ll live six years, get two weeks extra, and it will only cost him $7,200 a week.
The moral of the story is that the people who should be taking Lipitor are those in their fifties and sixties who are likely to gain several years of life by its consumption.
Then there’s the quality of life issue: maybe, just maybe, your quality of life will be acceptable for a longer period of time if you take Lipitor (by avoiding that heart attack for a while.) That could be worth a lot of money. If you can afford it.
Note to my father: none of this applies to you. Take your Lipitor.
There’s more: in the past year or two, some generic drugs have gone up in price by five or ten times. The average generic seems to have doubled in price. There is no single explanation for this phenomenon, although when pressed, companies have claimed that expenses have increased dramatically… to update and maintain manufacturing facilities, for example. In most cases, however, what has really happened is that there has been consolidation of drug companies such that where three or four manufacturers supplied a generic, now only one does so. Which creates a monopoly, making it easy to raise prices without losing market share.
There is a new form of funding for the development of pharmaceuticals that is supported by tax free donations but ultimately results in private profit-making. For example, the Cystic Fibrosis Foundation accepts donations to fund research on drugs to treat or even cure cystic fibrosis. It then invests in a private pharmaceutical company–Vertex Pharmaceuticals–that develops the drugs.
The drug company developed Kalydeco but the Cystic Fibrosis Foundation didn’t try to control the end price. As a result, it costs $300,000 a year. The drug company makes enormous profits because this is a rare disease and most patients are already on Medicaid so some payment is guaranteed.
It is ironic that tax-free donations have supported a tremendously expensive drug which guarantees huge profits for the private company that has taken over the production of the drug. Wouldn’t it make more sense if those donations supported a drug which was distributed at cost to the victims of this life-shortening genetic disease? The government is supporting this process by making the donations tax-free and then paying for the drug to be given to patients, who are mostly destitute because of the cost of treatment (aside from the new drug, the cost of hospitalization, doctor visits, and all the other drugs and medical devices is enormous.)
Clearly, the people who pay taxes are not getting their money’s worth when they have to pay for the huge profits generated by shrewd investors in a drug created with donated money.
One more point: Kalydeco, at 300K/yr, is not a cure, only a maintenance drug. So it extends the patient’s life and has to be taken for the rest of her/his life. Do you see the potential future profits in that situation?
Snow Drifting Across Road
Comment of the Day
hughmass
Oregon (February 13, 4pm Pacific time)
If I were a space alien, I would be monitoring this country and sending back recordings to my home planet, not to educate them as to how humans work, but for humor’s sake.
This country increasingly looks like something from a (Groucho) Marx movie, with all the serious but nonsensical people running around making grand statements that show their goofiness.
I used to worry that humans might not survive another thousand years, but now I just don’t care. We are just incapable of rational, loving, intelligent government.
Hugh Massengill, Eugene Oregon
Thank you, Hugh Massengill, for stating the truth as Jon Stewart would have put it. What are we going to do when Jon Stewart retires?
Boots on Ice
Merck and the Mumps Vaccine
A blog post under the HuffPost Canada aegis brings publicity to whistleblower law suits that are currently in the courts: researchers are claiming that Merck concealed the inadequate efficacy of its mumps vaccine in order to further their monopoly interest in the the vaccine.
The blogger, or HuffPost columnist, is Lawrence Solomon, and he seems to be a real muckracker. Nonetheless, the facts of this set of whistleblower suits seem to speak for themselves. Two former Merck scientists and a researcher for the Centers for Disease Control have filed suit. A federal civil suit charging fraud in obtaining a US monopoly on the mumps vaccine is also wending its way through the courts. In a fascinating coincidence with my last two posts, Merck’s address is given as Hunterdon County, New Jersey. I noted that the Sheriff of Hunterdon County has been accused of gross corruption in his management of his office, and apparently Celgene is also headquartered in this county.
To return to Merck and mumps: a private practice in Alabama, Chatom Primary Care PC, filed suit in June 2012, alleging financial damages because Merck fraudulently obtained monopoly status for its mumps vaccine, raising the price, even though it knew that the vaccine was less than 95% effective, a standard needed for induction of “herd immunity.”
A second federal case, United States vs. Merck, “stems from claims by two former Merck scientists that Merck “fraudulently misled the government and omitted, concealed, and adulterated material information regarding the efficacy of its mumps vaccine in violation of the FCA [False Claims Act].””(from the HuffPost blog post.)
The third case is a little more murky, and is being flogged by a Republican Congressman, Bill Posey of Florida, who still wants to blame vaccines for autism. As the blog post states, “The third whistleblower — a senior CDC scientist named William Thompson — only indirectly blew the whistle on Merck. He more blew it on himself and colleagues at the CDC who participated in a 2004 study involving the MMR vaccine. Here, the allegations involve a cover-up of data pointing to high rates of autism in African-American boys after they were vaccinated with MMR. ”
A reanalysis of the original study from 2004, which found no link between autism and the MMR vaccine in whites or blacks, was published in August 2014 in Translational Neurodegeneration, but was retracted within a month. The original study was published in Pediatrics and still stands. The author of the new study was Brian Hooker, a biochemical engineer, who reanalyzed the original data from the old study. He reinstated data from patients who had been excluded because they had no birth certificates, after being contacted by William Thompson, a senior scientist at CDC who has worked there since 1998. However, the blog post states that Thompson complained about Hooker having recorded his telephone conversations without his knowledge and then posting them online without his permission. The CDC claims that it presented data for both sets of patients: those with Georgia birth certificates and those without; no relation between vaccine and autism was found in either set. The new Hooker study was roundly condemned as an example of data-trolling (making multiple comparisons between dependent and independent variables without making proper statistical compensation for the extra comparisons.)
Hooker, it turns out, is associated with an anti-vaccine group (Focus Autism Foundation) that claims vaccines cause autism, and Hooker himself has a sixteen year old child who is developmentally delayed (whom he claims is “vaccine injured.”) The lead author of the original 2004 study, Dr. Frank De Stefano, and the rest of the authors still stand by their work and say that it is clear that autism does not result from vaccinations; in fact, it probably begins in the womb.
The additional information about the new study was gleaned from a FOX13 article by Ashton Edwards and CNN Wire, posted online on August 24, 2014. This article goes on to detail the vaccine-autism controversy and explains that the original scare was started by an article written by Andrew Wakefield and published in the Lancet in 1998. This study, which had only 12 subjects, was retracted and resulted in Wakefield losing his medical license for fraud. The entire scare, brought on by this absurdly bad article alone, has still not died down, and some parents and even people who should know better still think that autism (and mental retardation, among other things) is somehow related to vaccines.
The vaccine-autism bridge notwithstanding, it appears that Merck has been playing fast and loose with its research on the efficacy of its mumps vaccine. This would not be hard to do, as the mumps virus is attenuated by multiple passages through cell cultures and there is a fine balance between the virus’ potency and its benignity. Internal research performed by pharmaceutical companies is shrouded in secrecy as it is considered proprietary information. That is, the company can refuse to reveal anything about its research as it can claim that this information could give its competitors an unfair advantage. They say it’s a trade secret, like the formula for Kentucky Fried Chicken spices.
Vaccines are not fast food, unlike KFC chicken. But the capitalist, competition-oriented system under which pharmaceutical companies flourish (or barely keep their heads above water, in the case of vaccines) makes it possible for them to violate a basic tenet of scientific research: transparency, and the ability to replicate another researcher’s work.
This violation of transparency works against advancement in scientific knowledge about pharmaceuticals and vaccines, and slows the progress of medicine in its continuing fight to conquer disease and alleviate human suffering.
The only way to resolve this roadblock to the progress of medicine is to transform pharmaceutical companies (and medical and surgical equipment companies) into public trusts so that knowledge about advances in medicine can be freely shared. How this can be done without upsetting the profits of pharmaceutical companies is problematic, but surely a solution can be found that opens up the flow of knowledge without beggaring the stockholders.
Until transparency in pharmaceutical research can be obtained, drug companies will continue to encourage corruption in government and commit fraud in their efforts to get a competitive advantage.
A Note About Senator Robert Menendez
We had previously noted that a Dr. Melgen, an ophthalmologist who was Medicare’s top biller recently, prescribed a lot of Lucentis, a drug made by Genentech, a subsidiary of Roche. Dr. Melgen also contributed over $700,000 to a superPAC called Majority PAC. Some $600K of this money went to help re-elect Senator Robert Menendez of New Jersey, who is a Democrat.
Well, Democrat in name, anyway. It seems that Mr. Menendez and Mr. Obama do not see eye to eye. The president’s policies on Cuba and Iran are particular areas in which Mr. Menendez has criticized him. In fact, Menendez has said, “I don’t get calls from the White House.” [quoted in the New York Times today.]
So we see that Democrats in New Jersey like Mr. Menendez are beholden to, or at least entangled with, pharmaceutical manufacturers, and do not agree with the president on important matters of policy. In particular, Mr. Menendez does not believe that we should end our fifty year long, increasingly pointless and vindictive, embargo against Cuba. Mr. Menendez also believes that we should increase sanctions against Iran at a time when we are in the process of negotiating an end to Iran’s nuclear misbehavior.
It is clear that Mr. Menendez does not like Mr. Obama for reasons that are not completely obvious. Could it be that his disapproval has more to do with his ties to the pharmaceutical industry and his occult corruption than the fact that they are both in the same Democratic Party?
A note about New Jersey governor Chris Christie: as followers of the news know, he has run the government of New Jersey like his own personal corporation, using the machinery of government to punish or reward his enemies and friends to a frighteningly vindictive extent. The incident known as “BridgeGate” in which one of his highest personal assistants was caught ordering a partial closing of an essential bridge from New Jersey into New York that caused an enormous traffic jam, simply to politically punish a Democratic mayor who refused to endorse him, is just one example of his pettiness and disrespect for his constituents.
Now comes a federal Justice Department look at his responsibility in the quashing of indictments against Sheriff Trout of Hunterdon County in western New Jersey. The sheriff and undersheriff were subjects of a grand jury investigation that returned 43 indictments for abuse of office, but the indictments were quashed by the Christie administration. The story was aired in a long article in the New York Times in 2013, prompted by a whistleblower who was fired for his pains. The federal Justice Department has only recently begun to investigate this situation.
The reason I bring this up here is that a top pharmaceutical company executive, Robert Hariri of Celgene, has been mentioned (but not indicted) in this case. It seems that Mr. Hariri is a big supporter of Governor Christie, and he was given “fake law enforcement identification” by the sheriff above after doing a favor for the undersheriff.
This tidbit was mentioned in an International Business Times article about the federal investigation, and I quote:
”
The county prosecutors’ case against Trout and her underlings also involved embarrassing allegations about a particularly prominent figure — Robert Hariri, a high-level executive at the pharmaceutical giant Celgene, which is headquartered in New Jersey. Though Hariri was not charged, county prosecutors alleged he had obtained fake law enforcement identification from the sheriff’s office after he flew Russo on his private jet to a conference in Washington.
Hariri was a major contributor to Christie’s campaign as well a[s a] member of the governor’s transition team. Celgene employs Christie’s former chief of staff, Richard Bagger, and the firm has made $160,000 worth of donations to the Republican Governors Association — which until recently was chaired by Christie. Celgene occupies a seat on the board of Choose New Jersey, which has funded Christie’s international travel.
”
Thus, we see that the pharmaceutical industry is a strong supporter of one of the most corrupt governors in the United States, who had been mentioned as a potential candidate for the Republican nomination to run for President of the US. Unfortunately for Mr. Christie, “Bridgegate” has scotched his plans in this regard and revealed to potential Democratic supporters (whom he has courted) that he is no better than the average Republican candidate.
The IBT article can be found here: http://www.ibtimes.com/chris-christie-administration-target-new-federal-criminal-probe-1806644



