Right now in the United States of America, there is a monopoly that exists that involves epinephrine auto-injectors. EpiPen is the United States only supplier of these auto-injectors because other brands have suffered setbacks and failures, patent protection laws, and because there are currently no generic versions of EpiPen in the United States (Johnson). This monopoly was not a problem until Mylan bought Meda AB in 2007 (Paton). “Since Mylan bought the rights to EpiPen in 2007, it has raised the price on 15 separate occasions, bringing the current list price to $608 for a two-pack up from about $50 a pen in 2007” (Mole). This has been a price increase of more than 500%, and this shows that Mylan has been using the monopoly to its advantage.
Many believe that the FDA has financial reasons for allowing a drug to be on the market. In 2006, a study found that” in 22% of advisory board meetings, more than half the members had direct financial in the companies whose medial products they evaluated or their rivals”. The FDA’s advisory boards should not be able to vote on companies that they have financial ties to. The FDA says they do the best they can to create an unbiased board, but it is difficult to find “top medical experts with no ties” to pharmaceutical companies. Since a number of people have complained about this, Congress decided to make the FDA cut twenty-five percent of the advisory board that has financial ties with the pharmaceutical company being evaluated over the next five years.
In the U.S. there currently is no government regulation when it comes to prescription drug prices, granting pharmaceutical companies complete control over their prices. Unfortunately, many companies take advantage of this freedom and there is a lot of corporate greed that occurs when setting the prices of these life-saving medications. While research, development, and trial for these new drugs are extremely expensive and are taken into account when pharmaceutical companies set their prices, it is not justifiable when these prices are exceeding inflation rates. Moreover, “Drug expenditures nearly doubled between 1980 and 1991 (from $15.8 billion to $29.2 billion), even after adjusting for inflation. Much of this increase was driven by increases in prescription drug prices, which rose by more than twice the rate of inflation between 1980 and 1991” (Gross).
Lori Chordas claims in her viewpoint that the production of generic versions of prescription drugs cuts the price of medication notably. Brand names can cost from thirty to eighty percent more than generic versions of the same medication. More Americans are recognizing the savings associated with buying generic brands instead of brand name. Generic drugs made up sixty five percent of prescription drugs distributed in 200 according to IMS Health.
Advertisement of Prescription Drugs Thousands of people today rely on the use of prescription drugs to relieve anything from the severe pain of a car accident or something as little as a cough. Many people today see advertisements of prescription drugs that urges them to go to their physician to see if these drugs could perhaps relieve some of their symptoms. Yet, when doctors try to start them off on drugs that are over-the-counter or even cheaper, patients demand the harder drug they had seen advertised. The article, “Should prescription drugs be advertised directly to consumers?” mentions the pros and cons of the advertisement of drugs that can only be legally prescribed to patients by doctors.
Prescription drug industry is an oligopolistic market where a few firms dominate the industry and entry into the market by new firms is generally considered highly unlikely. Entry barriers such as cost structure, pricing pressures, regulatory approval process, patent protection and legal restrictions form the primary sources that make it really hard on new entrants. Heavy spend in Sales, Marketing, R&D and Manufacturing required prescription drug firms to possess significant capital to survive. Patent protection gave these firms an opportunity to maintain monopoly for several years and remain profitable. Spend in R&D, early mover advantage and innovation ensured that the firms entering the industry could not replicate the chemical processes and manufacturing practices easily and cost effectively.
Since prescription drug ads present public health concerns, the companies are held to certain standards or else it could result in a liability lawsuit. When an unsafe product harms an individual, they may have a cause of action against the persons who designed, manufactured, sold or furnished that product (National Institute on Drug Abuse). These liability lawsuits are instilled to protect consumers from being harmed by powerful companies that produce harmful products. In most cases a plaintiff’s claim may fall under four different categories: negligence, breach of warranty, misrepresentation, and tort reform (National Institute on Drug Abuse). This shows the large amount of restrictions against prescription drug companies when advertising
Pharmaceutical companies have been faced with the strain within their own industry as well as government agencies
Prescription drugs (opiates only) have caused over 165,000 deaths within the last 15 years and is currently on the rise. Over 2 million Americans in 2014 were addicted to Opiate prescription narcotics. The most troubling fact is listed directly on the Center for Disease Control and Prevention (CDC) website: “As many as 1 in 4
Prescription drug (RX drug) advertising (ads) on television, newspapers, and magazines should be banned in the United States. Due to many reasons, including the economic and physical stress it sets on consumers who rely on prescription medications everyday. Drug prices are on the rise, as they need to support the hefty funding for nationwide commercials at prime times. RX drug ads are seen on a constant loop in American TV. Washington Post writer, Justin Moyer’s article American Medical Association Urges Ban on TV Drug Ads, states that DTC (direct to consumer) ads spending has increased by 30% to a $4.5 billion industry, resulting in a 5% increase in actual RX drugs in 2015.
Peter J. Neumann and Joshua T. Cohen are both a part of the Center for Evaluation of Value and Risk in Health, both studied at Harvard. This would be a useful source to anyone writing about my topic since it is a recent article. This is an article supporting why prescription drugs prices are increasing and is a helpful angle to look at when thinking about prescription drugs prices rising as being a good or a bad thing. This is one of my scholarly sources coming from The New England Journal of Medicine. “Direct-To-Consumer Marketing of Prescription Drugs” Citation: Hollow, Matthew F. "Direct-To-Consumer Marketing of Prescription Drugs."
In the United States alone, $350 billion is spent annually on prescription drugs. Unfortunately, a quarter of Americans struggle to afford their medications. While drug companies argue that they need additional funding for research and development, it seems that their focus is primarily on creating drugs that offer minimal innovation but maximize profits. They resort to raising drug prices unjustifiably, even when the value of the medication does not warrant such inflated costs.
In today's society, we can see comparisons with the widespread use of prescription
Elizabeth thanks for your post, I appreciate your candor and you do raise several great points regarding the advantages and disadvantage of pharmaceutical and medical supply companies. Although these companies market directly to the consumer, in the theory, they are helping to enlighten the public about the world of new or old medicines, and provide an argument as to why these new products are good for them. Even if it helps the public to be informed of new medications or new equipment being used to help their disease processes. Does it benefit all parties in the long run?
Because the U.S. was seriously lacking in resources at the FDA, drug's approval was at a snail's pace compared to the rate in Europe. The United States was over a year behind that of Europe, more than half of the drugs that got approved in the U.S. had already hit the pharmacy shelves overseas almost a year earlier. As a result, patients, physicians, advocacy groups, with pharmaceutical companies were all dismayed that Americans were being denied the access to new medicines. In an effort to remedy this problem, Congress enacted the Prescription Drug User Fee Act (PDUFA) Of 1992. This act was to provide a path whereby charges were imposed upon the pharmaceutical companies, for each New Drug Application (NDA)
