Doctors prescribe action to bring down drug prices

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The American College of Physicians is located on the corner of 6th and Race in Philadelphia. (SHUMITA BASU / STAFF PHOTOGRAPHER)

Whenever he has traveled around the country in recent months to visit with his organization’s 143,000 members, Robert Doherty, an official with the Philadelphia-based American College of Physicians (ACP), has heard doctors complain repeatedly about the same issue: drug prices.

Prices, they said, were rising so fast and so much that increasing numbers of their patients simply couldn’t afford the medicines that doctors were prescribing. That left doctors with the choice of switching to a cheaper drug that might not work as well or sticking with an expensive one that patients might not be able to use properly.
“The prices of many drugs are escalating at unsustainable rates,” Doherty said.

As a result, the organization, which represents internal medicine physicians, has made reducing drug prices a priority, said Doherty, senior vice president of governmental affairs and public policy. It released a list of proposals calling for more competition and price transparency last month in the Annals of Internal Medicine. On Monday, Doherty publicly backed a set of consensus recommendations from the Campaign for Sustainable Rx Pricing. The panel supporting the Campaign, a project of the National Coalition on Health Care Action Fund, included representatives from AARP, the American Hospital Association and Kaiser Permanente.

The campaign’s recommendations are similar to ACP’s, but less detailed.

It called for releasing information about how much a drug is likely to cost consumers as well as the true cost of developing that drug — including how much the government spent on research — before a new treatment receives approval from the Food and Drug Administration. The FDA currently can’t take into consideration the expected price of drugs or even whether they are better than competitors currently on the market, Doherty said.

The organizations are not asking to change that, but think greater transparency about pricing, plus more information about comparative effectiveness, will affect consumer choices.

“We think of the approval process as a gateway to sell the drug,” he said.

The campaign is also calling for annual reporting of increases in a drug’s list price and for the government to report each year the top 50 drugs for price increases and for annual spending.

The campaign also made suggestions for how to improve price competition and it called for more research on how well new drugs work compared to alternatives.

In addition to those recommendations, ACP wants Medicare, which currently is not allowed to directly negotiate medical prices, to be able to negotiate volume discounts. It also said that insurance companies that use tiered formularies for medications should not be allowed to set the share that patients must pay so high that it “imposes a substantial economic barrier.”

Doherty said that information about the cost and quality of individual doctors and hospitals increasingly is being made public, a change he said his organization supports. The same should be required of drug companies.
“The pharmaceutical sector so far has not been held to the same expectations,” Doherty said.


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