You know those drug ads with the snazzy slogans and ear-catching jingles that interrupt your favorite TV shows? I’ll bet you’ve found yourself singing one or two while you head to the kitchen for a snack or take a much-needed bathroom break.
Well, those advertisements are the brainstorms of the pharmaceutical companies, developed to make you head straight to your family doctor and demand the latest boutique drug designed just for you and your specific illness.
Trouble is, the industry spent over 8 billion dollars on these adds last year, and of course they passed the costs on to those looking for an easy cure and a catchy tune to whatever ails them.
Which means, unlike other developed countries around the world, we Americans pay a bundle for our drugs- sometimes a bundle so high that people simply can’t afford the medicine they need.
And that’s why President Biden’s announcement that ten drugs would be the first to have to negotiate prices with Medicare is such a big deal: it means that drugs Americans have paid to develop and market will now be available to older Americans at more affordable costs.
A little history here: when Medicare came into existence in the 1960’s, there was no prescription drug coverage. It wasn’t until 2006 that Part D drug coverage was available, and that only became law with the mandate that no price negotiation would take place between the drug companies and Medicare. Part D helped, but as drug prices continued to rise and explode, the 2006 law doesn’t bring today’s drugs into affordable range for most older Americans.
And that’s where we were today - until President Biden’s Inflation Reduction Act made negotiations for these drugs possible: Eliquis, Jardiance, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp. And I’ll bet you’ve heard of at least one, if not several, of these drugs due to the massive amount of advertising foisted on the public by the pharmaceutical companies.
So why is this such a big deal for those on Medicare?
Before I was Medicare eligible, I was prescribed an eye drop that saved my cornea from warping. Due to my insurance, my usual co-payment was $10 or less each month, because insurance companies do negotiate with drug companies to set prices. After Medicare, the co-payment (even with my Part D plan) was over $600 each month.
And that’s because, by law, there can be no negotiations between pharmaceutical companies and Medicare.
Which, of course, makes no sense until you know another piece of the drug puzzle.
According to Senator Amy Klobuchar from Minnesota, there are three pharmaceutical lobbyists for each congressional member in Washington. And that’s an investment the drug companies are willing to make because they generated over 1.48 trillion dollars in 2022, according to Yahoo Finance. And all that lobbying money is very enticing to politicians who need money to stay in power and get re-elected. And pharmaceutical companies are just fine with prices where they are.
But now, thanks to President Biden, that massive amount of money can begin to be whittled away so that prices start to fall and those who need medicine can afford it. According to the IRA, those ten drugs listed above are just the beginning.
And maybe a good place for the drug companies to start saving money is by cutting back on advertising, even if we won’t have a list of wonder drugs to give our doctors at our next visit or a catchy tune running through our heads.
But we might live a little longer and better because we will be able to afford the drugs we need.
Thanks again, Joe.