Monday, April 21, 2008

Big Pharma Joins Forces With The Insurance Industry. The Surprise Result? A Synergistic Aquafuck For You.

Of course when I say "surprise result" what I mean is "completely predictable result"

Doctors treating children with a rare and severe form of epilepsy were stunned by the news. A crucial drug, H.P. Acthar Gel, that had been selling for $1,600 a vial would now cost $23,000.

The price increase, put in place over last Labor Day weekend, also jolted employers that provide health benefits to their workers and bear the brunt of drug costs.

As it turned out, the exclusive distributor of H.P. Acthar Gel is Express Scripts, a company whose core business is supposed to be helping employers manage their drug insurance programs and get medicines at the best available prices.

But in recent years, drug benefit managers like Express Scripts have built lucrative side businesses seemingly at odds with that best-price mission. A growing portion of their revenue comes from acting as exclusive or semi-exclusive distributors of expensive specialty drugs that can cost thousands of dollars. And the prices of such medicines are rising much faster than for the mainstream prescription drugs available through a wide variety of distributors.

Wait..... you mean you take a product that people have to have in order to live, and make one corporation, an entity that by definition has as its most important responsibility making as much money as possible by any legal means necessary for its shareholders, the sole distributor of that product, and the price goes up?


But.....but.....Express Scripts says on its website that its mission is to:

make the use of prescription drugs safer and more affordable for more than 50 million Americans through thousands of employers, managed care plans, governments and labor unions.

Express Scripts says its mission is to make prescription drugs more affordable. And surely Express Scripts wouldn't lie. Because pharmacy benefit managers have a proven track record of holding themselves to only the highest ethical standards:

Medco Health Solutions, the largest U.S. pharmacy benefit manager, paid more than $200 million in kickbacks to a large unnamed health plan to obtain contracts, according to court documents filed last week by the U.S. Attorney's Office in Philadelphia, the Newark Star-Ledger reports. Federal prosecutors filed the documents as part of a civil lawsuit against Medco. The lawsuit alleges that Medco defrauded the Federal Employees Health Benefits Program. According to the lawsuit, Medco cancelled prescriptions, switched prescriptions without physician consent, did not fill prescriptions completely and failed to inform physicians about adverse medication interactions

And conducting themselves with only the utmost integrity:

The American Federation of State, County and Municipal Employees sued the nation’s four largest PBMs (PCS, Express Scripts, Medco and Caremark), alleging that they violated California’ Unfair Competition Law. The complaint charges that the four PBMs have negotiated rebates from drug manufacturers and discounts from retail pharmacies, yet have not passed those savings on to healthcare plans and consumers.

I mean, until now, the conduct of Pharmacy Benefit Managers was beyond reproach:

Caremark Rx, the prescription drug plan manager, agreed yesterday to pay $137.5 million to settle federal lawsuits filed by whistle-blowers that accused a company it acquired in 2003 of improper dealings with pharmaceutical manufacturers.

Maybe I should go back and change what I just said about corporations making money by any legal means.....

I should also change what I said about there only being one rat-bastard corporate monopoly involved. In the case of these specialty drugs there are two. Only one corporation is allowed to make the med. Then only one corporation is allowed to sell it to you.

In the case of H.P. Acthar Gel, an injectable anti-seizure medication derived from hog hormones, the fourteenfold price increase came after the maker, Questcor Pharmaceuticals, gave exclusive distribution rights to Express Scripts’ CuraScript unit last summer.“This sort of puts the spotlight on the greed angle of the business,” said Dr. Robert R. Clancy, a pediatric neurologist at Children’s Hospital of Philadelphia.

Dr. Robert R Clancy gets the Drugmonkey "Plain As The Nose On Your Face" award for outstanding accomplishment in stating the obvious.

He has been using H.P. Acthar Gel to treat a severely ill 3-year-old girl, Reegan Schwartz. Employer health plans bear most of the drug’s steep cost, with individuals in many cases making only a standard co-payment. In the case of the two courses of Acthar treatments for Reegan, the cost to her father’s health plan was about $226,000.

I bet if we gave FedEx exclusive rights to handle the delivery of H.P. Acthar Gel, we could get that price up to $400,000 or so.

Crap. I was trying to make a joke but probably just gave them an idea.

I'll let Questcor have the last word, because quite honestly, they make my point better than I ever could:

“We did some market research,” (Questcor executive vice president) Steve Cartt said. Talking to pediatric neurologists and others about various pricing options “gave us some comfort that the strategy would work, and physicians would continue to use the drug, and payers would pay,” he said. “The reality was better than we expected.”

The reality was better than they expected.

Wake up.


Pere Ubu said...


You think maybe it's sleazy-ass crap like this that's causing skyrocketing medical bills, and not them lazy welfare cheats?

Naaaah. FAUX News wouldn't lie to me, after all.

Conni said...

I have no words, other than RAGE.


Anonymous said...

What do you read to get your information on the latest pharma scams?

Anonymous said...

Jesus Christ! I need to invent a life saving drug and then mock the people it might save by charging 11 gazillion dollars for it, knowing full well that they will either buy it or die.

othertim said...

Oh my god. I was doing an inventory in one of the stores in my area. And they had one vial of this in their fridge. It scanned at over $20k AWP.

I made a ton of phone calls, because this had to be a mistake. Finally I had them adjust it to what the wholesaler book said (by counting it as 1/10th instead of the entire package)

Oops. And holy crap.

indietech said...

all i can say is, that i always knew express scripts was evil. i just never knew how evil.

kario said...

Amazing that Questcor doesn't have any email contact information on their website unless you're an 'investor.' Typical of a company who is only interested in their own financial security.


kario said...

Just FYI - here's the response I got after emailing them as an investor:

"Thanks for taking the time to express your opinion.

I wanted to provide you some additional information that the article could not address. First, our company was in severe financial distress before we took the action discussed in the article. We were in danger of going out of business which could have had devastating affects on patients, mostly babies, who need this drug to fight this pernicious disorder—infantile spasm. Left untreated, the outcome is bleak for these patients. With the drug, babies sometimes lead normal or near normal lives. Our primary concern was insuring that this drug remain available for these patients. Without this context, it is easy to reach the conclusion that we were merely being greedy. In actuality, had we not taken that action, we would have gone out of business, the drug would have gone off the market, and patients would be left without hope. Mr. Cartt talked with that particular reporter for over an hour to help him understand the situation with the US health care system that creates these holes. The reporter chose only the one sentence for his article.

Because of the changes we made, we also were able to create a safety net for the un-insured which did not exist before. As a result of this safety net, we have given away, free of any charges, drug valued at nearly $10 million in the last 8 months. We are proud to say that we do not know of one patient who needed our drug who did not get it.

We are a tiny company with one product. Hopefully the product can continue to reach those who need it most.

Best regards


Don M. Bailey

President and CEO

Questcor Pharmaceuticals Inc

DrugMonkey, Master of Pharmacy said...

Look how fair and balanced I am. When the corporate stooges have something to say, here I am letting them say it. Hell, if they had written me directly ida put it up as a separate post.

I wouldn't boo-hoo too much for Questcor. They lost $10.8 million in 2006, but this was after making almost $8 million in 2005. Hardly the things Chapter 7 is made of.

Also notice the lack of explanation for the sweetheart deal with Express Scripts. If Questcor wanted to jack up the price all by themselves, nothing was stopping them. No need to get ESRX involved.

Given away more than $10 million of
H.P. Acthar Gel? What is that, like 5 vials?

And no one would have ever gone without the med. Let's say Don isn't bullshitting us, a point I'm not conceding, and Questcor did go into bankruptcy proceedings.

1) The company would be allowed to continue operations until things got sorted out.

2) The rights to H.P. Acthar Gel would become an asset to be sold in the bankruptcy process, where they would have been snapped up by another drug company, who would probably be selling it for less than today's price.

Thanks, Kario, for tracking down Don, but I quite frankly just don't believe him.

Sara, pissed said...

Even more of a reason to go commie and do Universal Healthcare like Canada.
They don't have this shit happening up north.

kario said...

Yeah, when I followed up asking him why, if they were in such financial straits they didn't decide to let their company get bought out for an obscene amount of money by a bigger pharma co., he didn't answer.

I also asked why they would limit themselves to one vendor if they were hoping to widen their sales - seems counterintuitive unless they were wanting to make some obscene deal.

I'm still waiting for his reply, but I'm not holding my breath....

Alison said...

Actually, we have the exact same problem in Canada. The vials cost the same amount, so we are using a different product from another country (that is possibly less effective). So yes, the healthcare system pays but our taxes go up.

Madam Z said...

Drugmonkey, you sound depressed. I recommend you find a profession that is less stressful, like maybe working as a double agent, in Iraq...