EpiPen Price Gouging is Old News

On Thursday, Mylan announced a series of steps that will make its EpiPen more affordable for some patients. Over the past few years, Mylan had raised a standard two-pack of EpiPens to roughly $600. It had cost $100 in 2009. Then, following a recent uproar, including a public tongue-lashing from Hillary Clinton and a US Senator whose daughter uses the product, Mylan NV (MYL) said Wednesday it would help reduce the cost of the emergency allergy drug for people who are struggling to afford it. Clinton, for her part, became  excoriated Mylan’s “price gouging,” kicking off another selling spree on Wall Street, where Mylan’s stock has plummeted roughly 11% and the Nasdaq Biotech index saw a 3.4% decline, which was the worst of the summer.

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In a press release, Mylan said it would provide instant savings cards worth $300 to patients who have to pay full price for the drug out of pocket. That amounts to about a 50% price cut for people without insurance or for patients with high deductible plans.

“We responded this morning, first and foremost, ensuring that everybody that needs an EpiPen has an EpiPen,” Mylan CEO Heather Bresch said in an interview with CNBC. “As a mother I can assure you that the last thing we could ever want is no one to have their EpiPen due to price.” When asked why the price of EpiPen increased so much over the years, Bresch, who is the daughter of Senator Joe Manchin of Virginia, blamed “the system” which needs to be “fixed.” She said that with the savings card, “We went around the system. The savings card is equivalent to cash.”

In the course of Canadian coverage, it was assumed that Americans would be travelling north to grab cheaper EpiPens. And this is far from new.

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In 2013, I wrote about Americans purchasing pharmaceuticals from Canadian stores in Canadian Review of American Studies. The paper was called The Maple Peril and it explored the practice of cross-border drug reimportation, and considered the Bush and Clinton administration’s policies regarding the necessary balance between drug access, affordability, and safety.

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In the 1990s, lower drug prices in Canada forged a strong relationship between American consumers and the Canadian industry, leading to the expansion of illegal cross-border reimportation. This occurred in person or through Internet pharmacies. In Canada, the Patented Medicines Price Review Board (PMPRB) imposes federal price regulations, but a number of other reasons also drive down Canadian drug prices. For instance, lower prices on Canadian brand-name drugs are likely the normal result of market economics; that is, prices are matched to different supply and demand dynamics in the Canadian and American markets.

In 2001, as President Bush took office, thanks to Canadian regulations— as well as a weak Canadian dollar—Americans were saving 50 per cent to 70 per cent filling their prescriptions in Canada. In 2004, Canada’s review board reported that Americans paid an average 67 per cent more than Canadians for patented drugs; in 2003, while a three-month prescription for Merck’s cholesterol reducer Zocor cost $172 in Canada, American patients paid $328 for the same pills. The antiretroviral drug ritonavir (Norvir) cost as little as a $700 per year in Canada as opposed to $7,800 per year in the United States.

From the consumer’s standpoint, it was thus eminently rational – or, smart – to seek alternatives to American drugs. And it should come as no shock that drug prices became a major political and economic question mark within the Bush administration.

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The troubling matter of drug costs was first contested in the 1950s. Historian David Herzberg argues that ‘‘increasing competition and ever more intense advertising transformed the character of the once staid prescription drug business’’. The new, transformed pharmaceutical industry was challenged in the political arena when, in December 1959, Senator Estes Kefauver (D-TN) took up the general issue of administered prices. Through the Senate Subcommittee on Antitrust and Monopoly he investigated a host of industries, including ‘‘bread, milk, auto, steel, and electrical manufacturing’’ industries. He also focused on the American pharmaceutical industry’s monopoly and revealed a ‘‘series of price-fixing and collusion scandals’’.

During the ten-month hearings, 150 witnesses testified about cortical steroids, tranquilizers, antibiotics, and oral antidiabetics. Kefauver, who ‘‘favored an economy in which competition among small producers set prices,’’ asserted that the drug industry practised ‘‘price leadership’’ and suffered little foreign or domestic competition. His two principal experts, Dr. John Blair and Paul Rand Dixon, were media savvy and compared a drug’s production costs to its wholesale and retail prices; thereafter they brusquely questioned representatives of the pharmaceutical industry and neatly underlined the fact that consumers in the United States were paying a hefty sum for their medications. In one extraordinary example, the markup was 7000 per cent.

Kefauver’s subcommittee hearings, aided by the Thalidomide scare in 1962, eventually led to the passage of the 1962 Kefauver-Harris Act. Compulsory licensing and greater patent regulation, significant
pricing reforms, were excluded from the final product. Still, Kefauver’s legislation had a lasting impact. It increased the power of the FDA—the ultimate authority on whether a drug goes to market—and mandated a drug be both safe and effective; the new law also established standardized manufacturing procedures.
According to physician Jerry Avorn, the new law represented a ‘‘watershed moment in the nation’s approach to medications.’’ The legislation ‘‘completely changed the way doctors and patients thought about drugs’’. Just as important, Kefauver (and his pricing hearings) was the forerunner for a cascading set of consumer oriented hearings which focused on the growing power of the pharmaceutical industry’s advertising as well as the addictive nature of stimulants and sedatives.

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While President Bush adopted an amorphous position on reimportation, his appointments at the HHS and FDA did not.

In 2002, Tommy Thompson, who had already scuttled the legalization of reimportation, combined US national security imperatives and a policy opposing counterfeit drugs. In his estimation, drugs reimported to the United States from Canada constituted a clear and present danger to American consumers and, building his case, drew parallels with the new War on Terror launched after 11 September 2001. Thompson warned that ‘‘opening our borders to reimported drugs potentially could increase the flow of counterfeit drugs, cheap foreign copies of FDA-approved drugs [what the rest of us call generics], expired and contaminated drugs, and drugs stored under inappropriate and unsafe conditions.’’ Thompson’s argument concluded with a reference to the recent terrorist threats in Washington DC and around the country: ‘‘In light of the anthrax attacks of last fall, that’s a risk we simply cannot take’’.

In 2002, FDA officials underscored the necessity for vigilance against the dangers of drug importation. After chronicling the FDA’s recent legal struggles with counterfeit criminal enterprises in Alabama, Los Angeles, and Texas, one FDA leader recounted the seriousness of drug importation’s risks to public health. ‘‘Throwing open the door to drugs purchased by individuals directly from Canadian sellers,’’ Hubbard said of potential legalized importation, ‘‘will encourage unscrupulous individuals to devise schemes using Canada as a transshipment point for dangerous products from all around the globe’’.

Another tactic was to direct advertisements at consumers. One particular ad, sponsored by the drug industry, depicted two identical looking pills over the caption Quick. Pick the Capsule that Hasn’t Been Tampered With. The advertisement cited the support not just of the FDA and HHS, but the US Customs Service and Border Patrol and the DEA, arms of government usually concerned with protecting
Americans from very different kinds of drugs. The ad warned, furthermore, that allowing Americans to fill prescriptions in Canada ‘‘could open America’s medicine cabinets to an influx of dangerous drugs,’’ and it closed with an appeal to ‘‘Keep Black Market Drugs Out of America’’.

Ominous government advertisements also influenced Americans not to purchase drugs from Canada. A poster sponsored by the FDA and CBP also cast doubts on the safety and quality of foreign drugs. In an ad titled ‘‘Buying Medicine from Outside the U.S. Is Risky Business,’’ a vicious green snake, with fangs bared and piercing golden eyes, is shown squeezing a bottle of pills. To the right of the viper, the ad asked Americans: ‘‘Think it’s safe buying medicine from outside the United States? Think again.’’

 

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Essentially, the recent story of the EpiPen is far from new. Thanks for reading!

Here’s Bernie on prices after the Martin Shkreli story…

 

 

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Podcast Announcement – Radical Mental Health Therapy

I recently had the pleasure of joining Chris Hoff on The Radical Therapist Podcast. You can listen to our lively discussion about the 1960s, long-haired hippies, and mental health services during a period of big-time change. You can download the Pod here or through iTunes. Thanks for listening and sharing! #mentalhealthawareness #healthpolicy

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Weed in the Workplace

The newest issue of Canadian HR Reporter discusses ‘weed in the workplace’ and focuses on drug screening. There are some vital ideas here about on-the-job safety, the legalities of drug testing, and impairment. Basically – drugs during ‘9 to 5.’ Also, I get my two cents in there! Check it out at Increasing use of marijuana could cause problems on the job

 

Paperback Writer – Book Announcement

‘Dear Sir or Madam, will you read my book?
It took me years to write, will you take a look?
It’s based on a novel by a man named Lear
And I need a job, so I want to be a paperback writer
Paperback writer’

— The Beatles

I’m delighted to announce that my book – A Prescription for Scandal – is now available in paperback. Basically, it’s much cheaper. Please share and, hell, you might as well buy the book. If you’re interested in a discount, follow the link here Richert_Flyer_PBK and download the coupon.

 

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And so on and so on!

Book Description:

Everyone knows someone or some story that reminds us of the incredible power of the pharmaceutical industry in our everyday lives. We see the advertisements during football games and food show. We see them in Men’s Health as well as Shape and Cosmo. The ads are everywhere. And by most accounts we’re consuming more and more pills every year.

For as long as I can remember I’ve had an interest in the pharmaceutical industry. My grandfather was a physician at Royal University Hospital and my mom was anti-Big Pharma through and through. So I definitely recall plenty of stimulating discussions around the supper table. At the same time I’ve always been intrigued by our influential neighbour to the south, the United States.

My new book, Conservatism, Consumer Choice and the FDA during the Reagan Era: A Prescription for Scandal, tries to understand the American drug industry in the era in which I grew up, the 1980s. Ronald Reagan was President. Dynasty, Dallas, and The Dukes of Hazard were on [the] tube. And I was caught up in G.I. Joes and my next soccer practice. Little did I know then that these were watershed years for pharmaceutical companies. But they were.

In writing this book, I tell a sometimes frightening story about how the regulation of Big Pharma got twisted, turned, and pulled upside down by politicians, consumer groups, and drug industry leaders. At the centre of this tug-of-war was the Food and Drug Administration, an independent government agency that was constantly under pressure during the 1980s. The stakes were extremely high. Lives were at stake. People’s health rested in the balance.

In 2016, these things haven’t really changed. We still need to make tough choices about the role prescription and non-prescription drugs play in society. Sure, the drug industry has done important things for our health, and yet it also has too much power and influence in our lives. I hear this all the time. I’m hopeful that my book can shed some light on how we’ve gotten to this point and help us think about the future.

 

The Business of Body Parts and Body Products

Ewww. The business of body parts and body products? What? Sounds gruesome. Kinda grisly and macabre. But, as we discuss assisted suicide, selling plasma, or Canadian transplant tourists, in the media the way that we conceptualize the buying and selling our bodies will be vital.

Just like the poster for Daybreakers says, our bodies are a crucial “natural resource.” Hopefully not for a Vampire elite.

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In the newest edition of the Canadian Bulletin for Medical History, I review Banking on the Body , which opens with an account of Connie Culp, the first American woman to undergo a face transplant after having been severely disfigured by a shotgun blast to the head. Yeah, a shotgun!

The groundbreaking surgery in 2008 included a new mouth, nose, and cheeks and, afterwards, Culp was once again able to talk, smile, and smell.  It was a transformation of Culp’s appearance, her quality of life, and so much more.

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For Kara W. Swanson, an Associate Professor of Law at Northeastern University, this procedure transformed all human faces and signified that it was “now a body product” to be “harvested from one body for use by another” (1).  Culp’s story is one of medical ingenuity and ultimately positive, but it also fits within a larger history where “…the human body has become a source of property and value, as well as a source of hope to the dying and the disfigured” (2).

The book is really quite excellent. By examining human milk, blood, and semen, it clarifies how bodies and body products have been organized and exchanged in the United States over the past century. In doing so, Swanson highlights the significance of two interrelated concepts –  the banking metaphor and the gift/commodity dichotomy – and provides lessons for Canadian policymakers.

In 1937, Dr Bernard Fantus of Cook County Hospital in Chicago borrowed the term bank from the world of money and markets to describe the process of stored blood in his hospital. Blood banks were a fresh way to think about maintaining the American blood supply and, not surprisingly, came under fire for the implied association between body products and money.

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Yet, Fantus’s aim was not to promote commercial enterprises. Amid the toil and deprivation of the Great Depression, Fantus sought to “subvert the market allocation of blood solely to those who could afford to pay.” Cannily, “…by treating blood as money, he was trying to circumvent the need to pay money for blood” (7-8). The term bank proved resilient and the banking metaphor has grown as the dominant way of understanding the tradable value of “disembodied fluid,” as well as other body parts (7).

While the two hundredth anniversary of Mary Shelley’s Frankenstein inches closer and we continue to make advancements in the transplantation of human body parts, as in the case of Connie Culp, this sophisticated book has the potential to guide policy and frame future debates on bodies as both personal and civic property.

My review of Banking on the Body: The Market in Blood, Milk, and Sperm in Modern America can be read here.

Introducing Pointscast, our new Podcast!

Congrats on the new podcast! Check this out…

Points is incredibly excited to announce that our assistant managing editor Kyle Bridge and Alex Tepperman, PhD candidate in history at the University of Florida, have launched a new podcast called…

Source: Introducing Pointscast, our new Podcast!

Clarify Pot Policy for Veterans

Today I wrote a short viewpoint for the Star Phoenix. The article is on medical cannabis for Canadian veterans.

Auditor General Michael Ferguson has raised important questions about the increasing use of medical marijuana by Canadian military veterans.

As authorities contemplate enforcement actions and zoning bylaws relevant to marijuana dispensaries, and the federal Liberal government prepares for legalization in 2017, Ferguson is urging the Department of Veterans Affairs to address the amount of medical cannabis being prescribed to veterans. He found the quantity prescribed was “poorly documented” and not always evidence-based.

Ferguson focused more broadly on how Veterans Affairs has been managing drug benefits for former servicemen and women, some of whom have complicated health issues and suffer from mental health conditions such as post-traumatic stress disorder. The AG made it plain that it’s time to cut through the haze and clarify marijuana policy for veterans.

The core problem rests with the amount of cannabis veterans are authorized to take. In 2014, Veterans Affairs doubled the amount to 10 grams per day for eligible veterans. Yet, for Health Canada this is twice the amount it considers safe. An internal Health Canada document showed that more than five grams has the potential to increase risks to the cardiovascular, pulmonary and immune systems, as well as psychomotor performance. It has a chance of increasing the risk of drug dependence.

Ferguson’s office could not find any evidence to support this decision to increase the threshold. Veterans Affairs Minister Kent Hehr expressed shock in March that his department lacked an “informed policy” on the use of medical cannabis, even as number of claims by veterans for medical marijuana grew more than tenfold over the past two years.

According to figures provided by Veterans Affairs, 112 veterans were reimbursed for medical marijuana in 2013-14, The following year, it was 628. By March 2016 that number has risen to 1,320.

Mike Blais, president and founder of Canadian Veterans Advocacy, has been abundantly clear about veterans’ consumption of medical marijuana: “I think there should be no cap, and that every case should be judged on individual merit and that the doctor’s prescription is paramount.”

At the same time, Canadian Forces have taken an alternative stand. In 2014, H.C. MacKay who was then the deputy surgeon general of the Canadian Forces, made clear that “with respect to marijuana use for medical purposes, we have identified what appears to be a very significant policy divergence between Veterans Affairs Canada and Canadian Armed Forces.”

In short, even though Veterans Affairs was funding medical marijuana, the military’s health service did not recognize it for medical use. With respect to PTSD, the Canadian Forces have also suggested there is insufficient evidence to authorize marijuana use and could even be detrimental to veterans’ health.

Marijuana remains a highly contested medicine for various scientific, political and social reasons. That is obvious. However, the auditor general report reaffirms how it and the policies surrounding the medical treatments for Canadian veterans require significant clarification.

Lucas Richert teaches the history of pharmaceutical and recreational drugs at the University of Saskatchewan.

Below the CBC covers the story.