Drug Companies and Price Gouging

Drug Companies and Price Gouging

The high cost of prescription drugs is on the top of the list of concerns that many seniors have, especially as the increasing rate of inflation has forced so many seniors to spend their limited income on other necessary items.

TSCL has been fighting to get Congress to lower drug prices, but the legislation is blocked in the Senate because of disagreements between and among Republicans and Democrats.

Part of the reason for that is the huge amount of money the big drug companies have been spending to lobby Congress not to pass new legislation.

In addition, there has been infighting between various businesses and groups that are part of the complicated system that provides prescription drugs to the American people, one side blaming the other for the high prices, while also fighting to maintain their huge profits.

Last week, StatNews, a news source that reports exclusively on health care issues, published an article about a man who was “a pioneer of the argument that drugs were often underpriced and prices should be based on their value to patients and society, a strategy today known as value-based pricing. If someone thought the price was too high, then they simply needed to be educated about the drug’s true value. It is an argument that drug companies have used to justify ever-higher prices.”

The man, whose name is Mick Kolassa, was at one time “perhaps the most sought-after drug pricing guru in the United States.”

But, according to the article, “… in recent years, he has mostly stepped away from consulting about drug pricing, dismayed by how companies were distorting the concept of ‘value-based pricing’ and taking advantage of a broken market to price gouge.

According to the article, “The language of ‘value’ became not simply part of the decision-making process leading to those higher prices, but also the way to justify them to the public. It eventually replaced the traditional explanation of high R&D costs as the industry’s go-to defense for high drug prices.

“As more and more drug companies became aggressive on pricing, there were increases not just in launch prices but also in the emergence of regular price increases for drugs that were already on the market.”

There is much more information in the article, and you can read it in its entirety by clicking on the link at the end of this article.

But the article makes clear, as TSCL has been saying for a long time, drug prices are way too high, and Congress needs to take action immediately to lower drug prices – regardless of what the big drug companies are saying.  Read the full article here: Drug Pricing Playbook