What About the Drug Company?

IMG_2713I could complain about the drug companies and their exorbitant prices.  I will in a minute.  Mostly, I am really glad that I have more in my pharmaceutical armamentarium than leaches and bloodletting.  We are truly in an age of medical miracles, life-saving medications, and improvement in quality of life for the chronically ill.  Drugs are amazing.  Drugs save lives.  There are a LOT of them.  Many of them are just replicants of already existing ones, everyone clamoring for their version of Viagra®.

It costs a lot of money to bring a drug to market.  It’s a good idea to take an already existing medication, make a few tweaks and push it on the masses.  It works, doctors are already prescribing something like it, instant bucks.  Put a hot chick in a tight skirt, place a brochure of the drug in one hand and bag of lunch in the other and waa-laa, the doctor nerds will prescribe anything.

Just a quick look on http://www.drugs.com and I found the following drug costs (these are averages):

  • Albuterol $50
  • Lipitor® (generic) $125
  • Metoprolol (generic) $25
  • Effient® $350
  • Eliquis® $360
  • Humira® $3500

If your insurance does not pay for the medication or you do not have insurance you can expect to pay approximately those rates.  Per month.  Forever.  Until you die.

Why?  Drug companies, like insurance companies, have investors.  They also have the expense of finding and studying the drug, marketing it, and paying off lawsuits should the drug cause unforeseen side effects.  With all of the costs of getting the drug to market and keeping it there, Pfizer one of the world’s biggest pharmaceutical companies made $49.6 Billion in 2014, $12 billion of which went right back to the shareholders.  They make Eliquis®, Viagra®, and Lipitor® among others.

Is it too much, or just business as usual? Do the drugs really have to cost so much when the drug companies are making such a large profit?

I haven’t even touched on the price of chemotherapy drugs.  On average, it costs about $10,000 per month (and upwards of $30,000 or more) to pay for drugs that treat cancer.  That’s just for the drug.  Cancer is really expensive.  I’m not even considering PET scans, CT scans, radiation treatments, or doctor’s visits.  The drug company is not completely to blame for this, often hospitals will inflate prices to cover their “administration” costs.

Individual insurance companies can negotiate prices for medications with the drug company, that’s why you will often hear of medications as part of a formulary and characterized as “tier 1, 2, or 3.”  The smaller tier medication being the cheapest.  Medicare and Medicaid, unfortunately have been limited in negotiating for cheaper drug prices after the Department of Health and Human Services was banned from such practices by Congress in 2003.  The government insurances then pay whatever the drug companies charge.  For Medicare patients that cost is also passed onto the consumer when they fall into the “donut hole.”

Maybe the high cost of medications comes not only from the expense of research and marketing of new drugs, but also to pay off some politicians to ensure higher profits into the future.

The Money Monster

Accountable Care Organizations: A Brief Description


  1. http://www.bbc.com/news/business-28212223
  2. http://www.pfizer.com/system/files/presentation/Q4_2014_PFE_Earnings_Press_Release_alksdjindfls.pdf
  3. http://www.webmd.com/health-insurance/20140506/chemo-costs-in-us-driven-higher-by-shift-to-hospital-outpatient-facilities?page=1
  4. http://www.statnews.com/2016/01/06/medicare-negotiate-drug-prices/



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15 Responses to What About the Drug Company?

  1. No-hoper says:

    If I was Bernie Sanders and was elected in a few months time, the first thing I would do would be ending the protectionism of drug sales in the US and allow hospitals to access the international drug market.

    Liked by 1 person

  2. No-hoper says:

    I’m so glad I have the NHS…’albuterol’, or ‘salbutamol’ we call it, costs the NHS ~£1.50, and every prescription collected by outpatients costs that outpatient ~£8 no matter what the drug. I don’t understand how people with chronic conditions, like asthma, manage to surive in the US

    Liked by 1 person

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