Medical Management of Pricey Drugs

The pricey hepatitis C drugs represent a good problem, but a problem nonetheless, in that they represent a cure for the disease, but the price is so high.

Leah Binder has found that employers are furious and worried about drug prices in general, but the hepatitis C drugs in particular. Sovaldi is driving costs for these purchases, but more than that the fact that there is a drug out there that costs so much is a risky prospect.

“They don’t know what’s going to happen next year,” she said. “What’s the next drug that’s going to come along and just throw their whole benefits program out of whack? And I don’t know how long employers are going to keep in that game.”

The discussion moved on to the 21st Century Cures Act and how that would impact the pharmceutical industry. And while finding more cures is a good thing, Matt Salo is unhappy with 2 main parts of the legislation. First, it extends market exclusivity for approved drugs, which is what keeps prices high he said. Second, the legislation also speeds innovative therapies to the market, which sounds good in theory, but can have serious repercussions, Matt Salo said. Getting drugs to the market sooner means curtailing clinical trials and patient safety issues, which is dangerous for his beneficiaries, which in Medicaid includes the oldest, sickest, frailest, most medically complex patients.

Austin Frakt, PhD, also voiced concerns about the extended exclusivities.

“I think market exclusivity is clearly the mechanism by which prices initially start quite high and therefore we as a society have an obligation to look at that and we have a right to manage it in some fashion,” he said.

The way to manage prices hasn’t been decided, and each idea has strengths, limitations, and implications for research and development, which all need to be weighed, but it’s still better than simply granting market exclusivity and allowing companies to set whatever price they want, Dr Frakt said.