July 07, 2009
PhRMA, drug companies, bio-tech companies have been in the news lately. If you listen to them you will no doubt be told about their life-saving research and the largesse of their philanthropy — most of which is true. And when they say research is expensive and it takes a long time to recoup their costs, they are right. But as their research & development departments have shrunk their advertising and sales departments have grown. We should give them credit where credit is due, but there is a dark side that MUST be explored by the big drug companies if we are ever going to see real health care reform.
1. Data-Mining: Drug Companies are buying your prescription information without your knowledge and consent and using it to target future sales to the physicians they do not think are presribing enough of their drugs.
2. Pay to Delay: Name-Brand Drug companies have been in the news lately for paying generic drug companies to delay release of their generic products, which is costing consumers an estimeted $3.5 Billion per year. This adds cost to your premiums, and your state and federal budget (taxes).
3. Off-Label Marketing: This is the practice of marketing and prescribing drugs for purposes OTHER than what they were tested and approved for at the FDA. This is driven by a desire to expand profits out of existing research. This move has added billions to their profitability but has seriously compromised patient safety.
4. Funding & "Educational" Seminars: The drug companies hire doctors to stump for their drugs to offer their legitimacy on various health care panels and professional symposiums around the country. The payment by the pharmaceutical companies to these doctors or panelists is rarely disclosed. Example: $30,000 offer to one physician for one hour panel. No prior knowledge of drug required.
5. Funding & Research Articles: The drug companies write and fund their own articles and make significant contributions to others who write articles, making it very difficult to obtain truly independent analysis of the science, the efficacy and the side-effects. Even very reputable journals and authors are often recipients of Pharma $.
6. Over-prescribing: When profits run low, prescriptions need to increase. The U.S. spends $216.7 Billion in prescription drugs in 2006, 5 times the amount in 1990. (KFF, Prescription Drug Trends, 2008). Clearly a good amount of prescriptions are appropriate and necessary but there is significant reason to think we are nonetheless over-prescribing. From 1997 to 2007 the number of prescriptions purchased increased by 72%, where population growth was only 11%.(KFF, Prescription Drug Trends, 2008).
7. Issues with Disposal and Waste: Pharmaceutical grade drugs from human waste are now contaminants is many major water sources in the US. Some of this is from the practice of institutions dumping drugs down toilets, some is a reflection of the volume of prescriptions we are issuing in the U.S.
8. Drug Price Inflation: Drug prices have increased at a rate of 2.5 times the rate of inflation and are the fastest growing cost driver beneath insurance premiums.
9. Marketing Costs: Drug companies spend $30 Billion per year in marketing and you are paying for that: (1) in the cost of your drugs; (2) in the cost of your insurance premiums; (3) in the cost of a tax subsidy for advertising write-offs; (4) in the cost of your Medicaid dollars; and (5) in the cost of your Medicare dollars.
10. Gifts to Physicians: Drug companies spend $7 Billion per year in gifts to physicians and others who can order and prescribe their products. Research shows that this does impact prescribing behavior and drives up the cost of health care. Research also shows that individual physicians do not think it impacts their behavior but probably does impact the behavior of others. Physicians do not have any current requirement to disclose any of these relationships or possible conflicts of interest when treating you.
11. Sales Reps – Detailers: The salespeople who promote the drugs, do not have to be physicians or even scientists by training. Medical providers often lack an independent source of information or education to learn an objective assessment of the pros and cons of different drugs. While salaries vary, a drug detailer's income runs $80,000 per year or higher (which is more than some physicians are clearing after overhead these days). (Other states have elected to use "academic detailers" – state funded, educated, drug specialists with no tries to the drug industry.)
12. PhRMA Lobbies A LOT: The pharmaceutical industry spent $168 million on lobbying in 2007, a 32% increase over the previous year, according to a report released Tuesday by the Center for Public Integrity, the Wall Street Journal reports. The figure is expended to reach new records this year in 2009. YOU are paying for that in the cost of your drugs and in the cost of blocked health care reforms or by passage of pro-Pharma laws. For more information about their lobbying expenditures, go to http://www.opensecrets.org/lobby/clientsum.php?year=2008&lname=Pharmaceutical+Rsrch+%26+Mfrs+of+America&id=.
13. PhRMA Donates A LOT: The drug companies donate a lot of money, to campaigns, to public works projects, to non-profits, to charities, to disease groups, to elected officials, to fund many good programs and projects. This is no accident. It not only creates terrific PR, but you, the consumer ultimately pay for their generosity in the form of higher drug costs and tax write-offs, giving more tax-breaks to the industry. No one would want their charitable efforts to stop but you should understand how these relationships serve to drive up costs and make it more difficult to achieve true pharmaceutical reform.
14. Samples are the Opium of the Industry: Capitalizing on the high cost of their own drugs, drug companies then provide samples to physicians, which increase the likelihood of future prescriptions for that product and give providers a powerful tool to help their patients – who is likely to have difficulty paying for drugs. These samples also have both tax consequences and patient safety consequences.
15. Drug Patents: Drug companies are given 20 year patent, which means a 20-year monopoly on exclusive sale of the patented produce. Monopolies drive up costs. Furthermore, patents can be fairly routinely extended beyond the 20 years. Also, when a drug is about to go off patient a new patent can often be obtained for a de minimus change over the prior product. While some patent protection is clearly warranted, this is a very serious cost-driver to our health care system.
16. Patient Safety: Medication errors are among the most common medical errors, harming at least 1.5 million people every year and killing 7,000 per year. (Institute of Medicine of the National Academies). The extra medical costs of treating drug-related injuries occurring in hospitals alone conservatively amount to $3.5 billion a year (does not take into account lost wages and productivity or additional health care) (Institute of Medicine of the National Academies). These costs amount to approximately $887 million per year in out-patient care. Vioxx killed 30,000 people. Some of these safety issues are through mis-prescribing products and some are due to the use and release of unsafe products.
Just because these issues are true does not mean that they do not invent and deliver important, life-saving products. But just because they deliver important, life-saving products doesn't mean these are serious problems and we shouldn't fix and reform these key issues that drive costs of prescription drugs, drive costs of insurance premiums, introduce real conflicts of interest in health care, and present serious patient safety concerns.
You have a right to know why your drug costs run so high. You pay for it directly, in your insurance premiums, in the form of costs to state and federal governments and in the form of tax subsidies to the industry. If you are currently satisfied, then probably no reform is needed, but if you, like the majority of individuals and businesses are interested in health care reforms that get us better health care at a lower price, then we can not achieve any meaningful health care reform without addressing these underlying causes of uncontrolled health care costs.
There is no health care reform without pharmaceutical reform.
You can find more information from:
the Prescription Project
Pew Charitable Trusts
Kaiser Family Foundation
July 06, 2009
A few articles covered a few of the bills that take effect on July 1, 2009. If you are interested in any of the bills, in particular you can go to the Colorado General Assembly Web Site for more information. Below is a list of all bills with a July 1, 2009 effective dates:
HB 09-1010 Expand Film Production in Colorado
HB 09-1012 Incentives Wellness & Prevention Programs
HB 09-1036 Registration Fee for POST Board Cash Fund
HB 09-1081 Vehicular Homicide Statute of Limitation
HB 09-1109 Foreclosure Protection Delinquency Default
HB 09-1120 Public Servant Safety Crimes
HB 09-1132 Using Text Msg for Unlawful Acts
HB 09-1141 Update Consumer Credit Protections (portions)
HB 09-1157 Make BZP Schedule I Narcotic
HB 09-1163 Child Victim Crimes
HB 09-1185 Water Rights Applications / Documents
HB 09-1202 Mortuary Science Registration
HB 09-1218 State Capitol Lease Agreements
HB 09-1249 Consolidation of DOA Cash Funds
HB 09-1260 Designated Beneficiary Bill
HB 09-1293 Heatlhcare Affordability Act 2009 (portions)
HB 09-1326 Integrity of Citizen Initiated Petitions (portions)
HB 09-1330 DPHE Fees Feeding Operations Dischargers
HB 09-1338 State Insurance Law Comply Fed Law
HB 09-1339 Clinic Social Work Practice Defined
HB 09-1341 Licensed Psych Technicians
HB 09-1342 Eliminate Cigarette Sales Tax Exemption
HB 09-1357 Filing Campaign Finance Reports with SOS
HB 09-1363 Unemployment Compensation Enterprise
SB 09-25 Identification Document Security Fee
SB 09-26 Regulation of Athletic Trainers
SB 09-38 Clarification of Judicial Fees
SB 09-40 Regulation of Manufactured Homes
SB 09-47 Crime Victim Services Advisory Board
SB 09-66 PERA Merger State DC Plan (portions)
SB 09-68 Funding for Domestic Abuse Services
SB 09-76 Employment & Training Technology
SB 09-80 Precipitation Collection – Rainwater
SB 09-87 Special District Accountability Act 2009 (portions)
SB 09-91 Motor Vehicle Dealer Franchise Agreement
SB 09-93 Identity Theift (portions)
SB 09-106 Water Supply Reserve Account Extension
SB 09-109 Sunset Fire Serve Train Cert Advisory Board
SB 09-110 Civil Rights Sunset
SB 09-111 Notary Public Sunset
SB 09-115 Sunset Livestock Market Regulation
SB 09-116 Sunset Colorado Seed Act
SB 09-118 Sunset PACFA & animal advisory committee
SB 09-124 Extend Ag Energy Related Projects
SB 09-127 Sunset Ag Regulation
SB 09-128 Unlicensed Medical Sunset
SB 09-137 Property Lien Waiver Debt 3rd Party
SB 09-138 Sunset Certified Nurse Aides
SB 09-151 Sunset Licensing Livestock Slaughterers
SB 09-175 Group Special License Place Requirement
SB 09-228 Flex State Revenues
SB 09-239 Sunset State Board of Nursing
SB 09-241 DNA Upon Arrest (portions)
SB 09-243 Workers Compensation Benefits Payments
SB 09-247 Expand Fed UI Benefits Fed Stimulus
SB 09-251 Optometrists Fee for Ophthalmic Devices
SB 09-294 PUC Tax Cab Application Requirements
July 06, 2009
Some of you may have seen the PR piece printed in the Denver Post for the Denver Metro Chamber of Commerce ranking the legislators on their votes on bills. Normally I wouldn't be proud of a 46% rating, but I am. Let's look a little further into what the Denver Metro Chamber considered "good votes":
- They opposed pharmaceutical reform, transparency, ethics and re-sale of your rx information.
- They opposed a bill prohibiting insurance companies for paying bonuses to deny claims or cancel policies.
- They opposed a bill requiring if an insurance company is going to deny medical treatment that the reviewer be licensed and qualified.
- They opposed autism coverage in insurance policies.
- They opposed the homeowner protection act balancing the scales against faulty homebuilders.
- They opposed sick leave for workers (a public health problem with the H1N1 or Swine Flu virus).
- They opposed parental leave time for parents to attend their children's academic functions.
- They supported every corporate tax credit around.
- They supported tolling on existing roads.
- They opposed a measure putting a penalty on employer's who bounce their paychecks to their workers.
Are you serious? I am a small-business owner. I have managed 2 large companies. These are abysmal policy positions that work against the values and needs of most people in the state. I see opposition to health care reform, transparency, working families, best business practices and their consumers. I also know that other good business owners do NOT necessarily agree with the positions that are being lobbied in their name.
There is an alternate world where the business lobby works on actual economic development in the state and doesn't view all things good for workers as bad for business or all things good for consumers as bad for business. Most significantly, businesses are crying out for health care reform, yet it has been the Chambers of Commerce who have often been at the front of the line to oppose health care reform.
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