Scott Gottlieb, head of the Food and Drug Administration, wasted no time in his opening remarks at a forum last week on high drug prices.
âThe fact is that too many people canât afford the medicines that they need,â he declared.
On that, I hope, we can all agree.
The trouble is doing something about it.
In all other developed countries, patients are protected by government authorities overseeing the market for prescription meds, ensuring that prices are reasonable while still allowing drug companies a fair profit.
In the United States, profit comes before public interest. There are no limits to how much can be charged for a prescription drug, particularly specialty drugs intended for the costliest illnesses.
As a result, the U.S. is by far the worldâs biggest spender on pharmaceutical products, shelling out more than $1,026 annually per person, according to a 2015 report from the Organization for Economic Cooperation and Development.
Thatâs double the OECD average of $515 and considerably more than economic peers such as Germany ($678), France ($596) and Australia ($590).
Total U.S. spending on prescription drugs reached $450 billion last year, according to the research firm QuintilesIMS. It could be as high as $610 billion by 2021.
The FDA has no power to dictate pricing to drug companies. So Gottlieb said last week that the agency will focus on speeding up the approval process for generic meds so consumers have cheaper alternatives to branded drugs. It also wants to encourage greater competition among drug companies to lower prices.
âThese moves would help,â said Peter Hilsenrath, a healthcare economist at the University of the Pacific. âBut I wouldnât expect really big things to come of it.â
He pointed out to me that generics already account for about 80% of U.S. drug sales, meaning that faster approval of generic meds wouldn’t exactly be a…