New Report Reveals Drug Companies Trick to Keep Prices High

New Report Reveals Drug Companies Trick to Keep Prices High

A new report suggests that “product hopping”—a practice by drug companies to extend their patents on profitable drugs—costs American consumers and the U.S. health care system billions of dollars each year.

The report looked at five prescription drugs and found that drug companies slightly alter the formulas in those drugs, allowing them to extend their patents on the new formulations, and delay the move to the generic drug marketplace.

This, of course, keeps the costs of those drugs much higher than if a generic version were available.

That is only one of the issues involved with high drug prices, and the drug companies aren’t the only issue.

According to the lobbying arm of the major drug companies, in 2018, nearly half of the money spent on brand medicines went to some business other than the research companies that discover and manufacture medicines.

Those include pharmacy benefit managers, insurers, hospitals and others in the biopharmaceutical supply chain. Meanwhile, a greater share of the cost of medicine has shifted onto patients.

As with Social Security and Medicare long-term viability, reducing the high costs of drugs is also at the top on TSCL’s agenda this year.  These are complicated problems but Congress must find a way to deal with them and TSCL will be fighting for you as these debates continue.