Costly Drugs Under Scrutiny By Both Sides of the Senate

Costly Drugs Under Scrutiny By Both Sides of the Senate

The recent uproar on Capitol Hill over soaring pharmaceutical drug prices has both sides of the aisle calling for investigations. Two senators from opposite sides of the aisle announced a joint bipartisan investigation, while House Democrats announced their own Affordable Drug Pricing Task Force. Numerous reports in the media recently have described stunning price increases, mostly on older, off-patent drugs, after mergers or acquisitions of pharmaceutical companies. But the investigations are also looking at other forms of opportunism, including hiking prices if a drug finds new uses or wider popularity. In our sphere of interest, it's been the outrageous price hikes for naloxone earlier this year that have been of the most concern.

Widely known by the trade names Narcan or Evzio, naloxone blocks the effects of opioids and reverses the life-threatening respiratory depression of an overdose. During the past year or so, hundreds of police forces and emergency response teams have been added to the lists of new customers. And the minute that this newfound popularity became obvious, naloxone suppliers started hiking the costs - some 50 percent higher and others doubling, tripling and quadrupling the prices. The Senate's bipartisan probe into drug costs didn't specifically mention naloxone. But the probe's sponsors, Sen. Claire McCaskill (D-Mo.) and Sen. Susan Collins (R-Maine), are targeting other price increases and "the FDA's role in the drug approval process for generic drugs, the agency's distribution protocols, and, if necessary, its off-label regulatory regime." The two senators have requested drug pricing information from an initial group of four companies: Turing Pharmaceuticals, Retrophin, Rodelis Therapeutics and Valeant Pharmaceuticals. These companies (and others as well) acquire older, off-patent drugs and then skyrocket the prices overnight.

For example, Turing Pharmaceuticals acquired a decades-old AIDS drug, called Daraprim, and immediately raised the price from $13.50 a pill to $750 a pill - more than 55 times higher. Martin Shkreli, Turing's new owner, was made the poster-boy for pharma industry greed. Undaunted, Shkreli was quoted as saying he should have raised it even higher. Even before the Daraprim price increase, Business Day reported, Shkreli's business practices were already under scrutiny. There were regulatory and criminal investigations into claims of wrongdoing at hedge funds he once controlled, as well as at Retrophin, another pharmaceutical company he ran (and from which he was fired) where he jacked up the price of Thiola, a kidney stone drug, to $30 a pill from $1.50. Another company, Rodelis, acquired a specialized tuberculosis drug and immediately blew up the price from $500 for 30 capsules to $10,800 - over 21 times more expensive. The outcry from patients, doctors and the media led the company to return the rights to the previous owner, who returned the drug to the original price. Valeant and another company were embroiled in so much controversy about business practices that the entire Senate was looking into it. Valeant was also buying up the rights to older drugs and instantly raising prices.

This year alone, Valeant raised prices on its brand-name drugs an average of 66 percent. "We need to get to the bottom of why we're seeing huge spikes in drug prices that seemingly have no relationship to research and development costs," McCaskill said in a statement. Meanwhile, the price of naloxone remains a big concern. The prices have risen dramatically as demand has gone up, and many municipalities are finding it tough to afford. In February, for example, the Baltimore City Health Department was paying about $20 a dose. By July, the price had climbed to nearly $40 a dose. Naloxone isn't a new drug, it's been used since it received FDA approval in 1971 as an injectable medication. It was used primarily in hospital settings, but is now widely used in more convenient applicators. The most recent is a nasal applicator - it can be sprayed into a victim's nose to reverse an overdose and save a person's life. Maryland Rep. Elijah Cummings, the ranking member of the House Oversight and Government Reform Committee, places the blame squarely on the manufacturers, according to a report from NPR. In particular, he names Amphastar Pharmaceuticals, the company that makes the naloxone most widely used by health departments and police. "When drug companies increase their prices and charge exorbitant rates, they decrease the access to the drug," Cummings said. "There's something awfully wrong with that picture."

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