The Cost of Drugs Could Drive You to Drugs

The Real Rationale for Higher Drug Prices...

les Aaron


Some people ask me why are over the counter and proprietary drugs so high now?

And there's a very easy and perhaps smug answer: Because they can be...

Let me explain: In the past, when there was a Chairman of FDA who really tried to do his job, there was monitoring of drug prices.

Today, the attitude seems to be, "Hey, you want to raise prices, just throw a few sheckels in my war chest and I will look the other way..."

That's the real problem: Everyone has chosen to look the other way.

Even if I wanted to, it would literally be hard to chronicle the abuses of the pharmaceutical industry because they are so widespread, so complex and so completely driven by profits.

Let me just give you a few simple examples:

The Drug Companies lobbies tell us over and over again that the drug prices have to be so high because those prices cover all of their investments in coming to market with a new product, they are meant to cover research and development, trials, studies, etc.

The only trouble is that everybody takes their word as verifiable proof and instead of doing their job of "policing" those who belong to the Pharmaceutical manufacturing associations, they tend to accept what the drug companies tell them. That's mistake number one.

The truth is that in a certain sense what the spokesperson says is true, but it obfuscates and hides the truth that prices really not only cover research and development, they cover personnel costs from day one even though you might not have a single staff member, they cover projected marketing expenses, and they cover a built in profit that's bigger than anyone should expect.

Several years ago, the pharmaceutical industry and its auditors explained that it cost 700 million to over a billion dollars to introduce the average new product.

Later on, independent auditors not under the thumb of the FDA or the pharmaceutical companies suggested that the real cost for introducing a new product was really more in the neighborhood from 30 million dollars to about 120 million dollars--quite a disparity from what the drug companies were saying...

Here's another little point mostly overlooked by everyone whose not looking to make waves.
The raft of new products whose patent rights are ending have come out with replacement products even though the original products are, in most cases, better than the new products, are priced higher. Detail men and other marketing types are advertising the heck out of the new products and telling their people to tell doctors and others in the distribution channels that the older products are not as good as the newer products, and discourage generics.

Guess what happens?

The prices of the new products go up and there are no generic equivalents of the older products...

Clearly, our representatives in Congress remind me of the Pakistani police who make a big deal about finding bin Laden, but if he showed up, they would ignore him like the plague.
Nobody wants to rock the money lobby...
And who suffers?

That's right! Thank TV advertising, brother, it's the cause of most of our politicial ills.

Les Aaron