Healthcare is Hostage to Rx Pricing

By: Michael Weinstein, President, AIDS Healthcare Foundation

The impossible has happened. Harvoni, a pill that cures Hepatitis C made by Gilead, is selling for $1044 per pill. Decades ago we were outraged at the high price of AZT which was the first anti-retroviral HIV medication to come to market. Now the price of drugs threatens the long term viability of the entire U.S. healthcare system.

Gilead did not discover Harvoni. It bought the primary compound from a company named Pharmasset for $11 billion. That money came almost entirely from huge profits made by Gilead from the sale of grossly over-priced HIV medications. Pharmasset had planned to charge $36,000 for their drug. But, Gilead was not satisfied with that price and decided to push the envelope all the way up to $94,000 for a three month cure for Hepatitis C. During the same year, John Martin the CEO of Gilead, had total compensation of $206 million.

Michael Weinstein, AHF President, leading a protest.

Anger over drug prices has made this the number one healthcare issue by far among the American people. Presidential candidates Hillary Clinton, Bernie Sanders, and Marco Rubio are condemning Pharma on the campaign trail. Senators Charles Grassley and Ron Wyden are denouncing Gilead and other companies and conducting investigations. Yet, not a single piece of significant legislation is likely to be passed at the national or local level. A simple bill that would have required a little more transparency by drug companies was squashed twice in the last year in the dark blue state of California. Pharma's contributions to candidates on both sides of the aisle combined with vast lobbying budgets make passing legislation impossible.

Citizen ballot initiatives are one of the few avenues available to start to change the system. In fact, ballot initiatives were created to allow citizens to directly enact legislation when their elected officials refuse to act. Which brings us to the California and Ohio Drug Drug Relief Acts that will appear on their respective ballots in November. Pharma is so threatened by these initiatives that they have already contributed $40 million to defeat it in California and are trying every legal trick in the book to keep it off the Ohio ballot.

Pharma is working very hard to try to confuse the issue and pick apart the initiative because polling shows that 78% of California voters would support the initiative. First, to be clear this initiative is only a start to reining in drug prices. It is a very simple concept. The state will pay no more than the Veterans Administration for any drug. Critics, many of whom are directly funded by Pharma, say that the initiative can't be implemented and want us to address every hypothetical implementation issue. That is not our job. That will be the state's job after the initiative passes.

You don't have to believe us about how important these initiatives are in giving voice to the anger over drug prices. Here is what PharmExec.com had to say on December 8, 2015:

"If the voters of California approve this proposition it would establish an incredibly deep, mandatory discount - in essence a "price control" - for the public purchase of prescription drugs in American's largest state. Such an action would not doubt cause an immediate demand for the same VA discount rate to be made available to other states, the federal government, and likely private entities as well. In short, adoption of VA pricing by the State of California would be a pricing disaster for the entire U.S. drug industry."

The California and Ohio Drug Price Relief initiatives can be a catalyst for a movement to stop the rampant greed of drug companies with your support. Please don't be distracted by all the dust the industry will try to throw up to try to divert attention from the real issue - an out-of-control system that is victimizing our country.

Editor's Note: This blog was submitted in response to our previous blog, "Is Ohio the Frontline in the War on Rising Drug Prices?"

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Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.