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.