On the HorizonPharmaceutical Companies—Love Them or Hate Them?
By Robert Hayes, MRC News, Spring 2002It is springtime, the season of blossoming love and boundless hope. What's a fellow in the Medicare business to do?
Should he love those neighborly pharmaceutical corporations that make the drugs that keep us young and healthy, and keep the blues at bay? Or should he hate those multi-national profiteers who manipulate promotions, patents and Congress to leave millions of elderly Americans unable to afford the medicines their doctors prescribe?
If there's a major failure of Medicare in the 21st Century, almost all experts agree it is the absence of a prescription drug benefit.
Back in 1965, when Democrats and Republicans came together to create the Medicare program, Congress intended to craft comprehensive health care coverage for aging and disabled Americans. Largely, they got it right. It was not so tragic then, as it is today, that Medicare did not cover prescription medications.
Times change. And science revolutionized health care. Perhaps the most significant shift in health care in the past four decades is today's reliance on medication. Lower your cholesterol, control your diabetes and high blood pressure, stabilize your hormones, and generally make your life longer and healthier–if you can afford the medicine.
Yes, we do love those pharmaceutical companies. But there is a rub. Medicine is too expensive for millions of elderly and disabled Americans.
While our tax dollars funded much of the research that led to medication breakthroughs, the global drug companies–Pfizer, Merck, Novartis, Eli Lilly and the rest–have exploited this know-how with brilliance.
All across the country, organizations like Medicare Rights Center try to help people with Medicare find a way to access health care. All too often, they suffer–and die prematurely–because they cannot afford the medications prescribed by their doctors.
It's well known that the drug industry has the kind of access to Congress that makes even Big Tobacco (and certainly every consumer-based organization) jealous. That influence led to legislation that has increased drug companies' patents on new prescription drugs by over 50 per cent between the early 80's and today. (When patents expire, other companies are allowed to manufacture generic versions of the drugs. Generics must meet the same federal regulations as the brand-name drugs but cost a lot less.)
In 2000, drug companies spent nearly $16 billion promoting their products. Merck spent more money that year buying ads for its anti-inflammatory drug Vioxx than PepsiCo spent advertising Pepsi.
Obviously it works. The ratio of profits to revenue for drug companies is over four times that of Fortune 500 corporations. But it's not fair. It's time to balance the scale.
The move toward a Medicare benefit for prescription medication must go hand in hand with aggressive management of the conduct and pricing of the world's pharmaceutical giants. It's the only way to make the benefit affordable. It's up to our government to control this industry, which literally can determine who will live and who will not by the prices it sets.
A business with such genius for marketing should recognize that today's over-reaching for windfall profits is not just adverse to the common good. It will be adverse to the long-term health of the industry itself. Tobacco learned the hard way. The pharmaceutical industry should be smart enough to know better.
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