“Passage of Inflation Reduction Act gives Medicare historic new powers over drug prices” (CNBC, August 12) is a headline that matches my understanding of the Inflation Reduction Act that addresses the emergency situation facing Americans. The Federal government will no longer necessarily pay huge $$ for mediocre pharma (or Bad Pharma!) and we’ll have something more like the British system where a committee asks “How much are the additional life-years obtained by use of this patented drug, compared to the effects of cheap generics that are similar, actually worth?”
Digging into the article, however, we find that no government worker need get off the sofa to do any negotiation for a few years. The soonest that taxpayers might spend a little less as a result of negotiations is 2026 and only 10 drugs will be affected.
Individual analogy: “My compulsive spending has resulted in a financial disaster so I’m cutting up my credit cards… four years from now.”
Returning to that CNBC article… What if you’re not old?
Lawmakers on the left such as Sen. Bernie Sanders, I-VT, have criticized the legislation for leaving out the overwhelming majority of Americans who are not on Medicare.
“If anybody thinks that as a result of this bill we’re suddenly going to see lower prices for Medicare you are mistaken,” Sanders said during a speech in the Senate earlier this week. “If you’re under 65, this bill will not impact you at all and the drug companies will be able to continue on their merry way and raise prices to any level they want.”
Who should do the negotiation on behalf of the beleaguered American taxpayer? The obvious choice: Martin Shkreli!
Related:
- “The Journalist and the Pharma Bro” (Elle): Over the course of nine months, beginning in July 2018, Smythe quit her job, moved out of the apartment, and divorced her husband. What could cause the sensible Smythe to turn her life upside down? She fell in love with a defendant whose case she covered. In fact, she broke the news of his arrest. It was a scoop that ignited the internet, because her love interest, now life partner, is not just any defendant, but Martin Shkreli, the so-called “Pharma Bro” and online provocateur, who increased the price of a lifesaving drug by 5,000 percent overnight and made headlines for buying a one-off Wu-Tang Clan album for a reported $2 million. Shkreli, who was convicted of fraud in 2017, is now serving seven years in prison.
> something more like the British system where a committee asks…
Unfortunately this is not necessarily reassuring. They too now conform to modern standards, i.e. that public health agencies serve as subsidiaries of the pharmaceutical industry.
Most of us will never receive medicare coverage & the premiums are on track to surpass private insurance. Instead of charging a premium for part D on top of the medicare tax, why not just get rid of medicare & just pay the premium?
What’s your solution? Privatized insurers are doing a good job of spending 10x of nationalized insurers for similar outcomes.
I personally believe some combo of transparent pricing, free preventative care, insurance not being used for routine care (and lower insurance costs), and some IP reform around drug development that still rewards investment in drug development/but no permanent reward, decreased gatekeeping by govt and ama would be an interesting experiment, but I can’t tell if it would be an improvement.
https://philip.greenspun.com/blog/2014/07/08/book-review-bad-pharma/ is a good start for anyone serious about finding a lower cost way to achieve the same medical results. Hardly any changes are required other than what the British do, i.e., refuse to pay huge $$ for patented drugs unless they are hugely better than generics, which they almost never are. The Brits set a value on a “quality adjusted life year” and then won’t pay more than that.
That said, I am willing to bet that the U.S. will never do anything remotely as smart as what the British do.
One knock against the Brits is that they abandoned their quality adjusted life year religion when confronted by SARS-CoV-2. With their lockdowns and school closures (see https://en.wikipedia.org/wiki/Impact_of_the_COVID-19_pandemic_on_education_in_the_United_Kingdom ), the Brits spent way more in their futile attempts to save life-years from COVID-19 than they ever budgeted for saving life-years from any other disease.
See also, the climate change emergency: “we must immediately cut co2 emissions” (except china, who is building 43 more coal power plants, while already burning 3x more coal than the rest of the world combined).