A cause for growing concern: feverish health care news on business pages
Ask Americans what’s their No. 1 health priority and an unsurprising answer pops up: Across the political spectrum, the Chicago Tribune reports, Americans are expressing growing concern about keeping the affordability of prescription drugs for serious conditions. The increasing unease certainly reflects that in recent days some of the biggest–and most troubling — reports in health care are appearing not on the news, medicine, or science pages but rather in financial sections and business information outlets.
It might not have seemed possible. But the emerging picture makes the Wall Street and Big Pharma types look even more execrable that imaginable.
The Internet, for example, can’t seem to find sufficient opprobrium for Martin Shkreli, the hedge funder whose Turing Pharmaceuticals acquired rights to the drug Daraprim and then immediately jacked the price of the infection-fighting medication from $13.50 to $750 in one night. An uproar ensued, especially because specialists said they had few alternatives to the drug in combatting parasites that can afflict patients with HIV, and Shkreli, basically, conceded that his company made its giant price increase because it could and would make a lot of money — not for any other reason, such as a reformulation or product improvement.
Experts quoted by The Times said Shkreli’s action was egregious but not uncommon, citing a new strategy by finance-driven firms acquiring “old neglected drugs and turning them into high-priced specialty” medications. Patients have taken a hit already when this happened with medications for multi-drug-resistant tuberculosis, some heart conditions, and the antibiotic Doxycycline.
Now, in certain quarters, the prescription for medication avarice would be market based, with competitors arising and undercutting egregious charges for drugs in high demand and low supply. But as Forbes points out, don’t hold your breath. A small San Diego firm popped up and said it could churn out its version of Daraprim for $1 a pill. Past experience, the financial news magazine says, suggests that Shkreli will still make a bundle and no matter the outcry, the drug-maker, in the end, turns out just fine — see what happened in the instance involving Makena, a medication intended to prevent pre-term birth.
Meantime, financial journalists and analysts are helping to unwind a deeply disconcerting yarn involving Valeant, a Canadian-based pharmaceuticals company with curious corporate tentacles reaching into many different areas of health care. Recent attention has focused on Valeant’s relationship with Philidor Rx Services LLC, a specialty pharmacy. As the Wall Street Journal observes: “Philidor …operated unlike traditional and specialty pharmacies. While traditional pharmacies dispense medicines made by a number of pharmaceutical companies, Philidor dispensed almost exclusively Valeant drugs, according to former employees. The Pennsylvania firm used unorthodox tactics to ensure payment, such as submitting a prescription over and over at different prices until an insurer would agree to pay, according to former employees and pharmacy industry officials. And the medicines weren’t drugs requiring special handling, pharmacists say.”
The New York Times has reported that, subsequently, the nation’s three largest drug benefits managers — Express Scripts, CVS Health and OptumRx — said they would stop paying for drugs dispensed by Philidor.
Meantime, over at the nonprofit, online journalistic investigations site Pro Publica, reports are appearing that U.S. prosecutors are scrutinizing Valeant’s acquisition of the maker of a key component of rigid contact lenses used by millions.
Although Valeant’s valuation has sunk like a rock as more and more gets revealed about its operations, the head of the hedge fund with a multibillion-dollar stake in the firm has defended it, saying it just needs better PR. In contrast, of course, New York Times columnist Joe Nocera calls Valeant “sleazy” and joins a West Coast-based research firm in asking if the pharma firm is “the next Enron.” Nocera points out that Valeant’s chief has, to the delight heretofore of Wall Street, broken the model for the way even highly profitable Big Pharma has operated, spending big money and seeking new block-buster drugs that millions need to take repeatedly. Instead, the plan of Valeant’s chief “was to acquire pharmaceutical companies, fire most of their scientists and jack up the price of their drugs.”
These sorry spectacles couldn’t be occurring, of course, at a worse time for Americans, who had just begun to see some hope that the health care cost-curve finally was bending and trending down. Moreover, partly in response to efficiency demands in the Affordable Care Act, analysts see big consolidations growing even more prevalent in health care providers of all stripes — hospitals, drug store chains, medical groups, and, yes, pharmaceutical companies. So Walgreens and Rite Aid merge, as Allergan and Pfizer move to do so (a tax-saving action, analysts say, with wags calling a possible deal Botox meets Vigra). Anthem tries to buy Cigna, while Aetna pursues Humana.
With all this corporate fever for wheeling and dealing, what happens to ordinary Americans, patients and consumers? With Washington riven by its partisan concerns and focused on a presidential campaign, will someone stand up for the sick?