HEALTH

Plenty of blame to go around on high drug prices

Jan 8, 2020, 6:12 AM | Updated: Jan 9, 2020, 12:09 pm

The rising cost of prescription drugs has some Utah families going to an "underground network" in o...

The rising cost of prescription drugs has some Utah families going to an "underground network" in order to afford their medication. (IMAGE: KSL Newsradio)

(IMAGE: KSL Newsradio)

Listen:

MURRAY, Utah — Nick DeNunzio calls himself a “Utah boy”, as he was born and raised in the state. Like most diabetics in the United States, he spends thousands of dollars a year on his medical care and to buy the two life-saving insulins Toujeo and Novalog.

“The scariest part about being a diabetic is walking into the pharmacy and [thinking] how much is this going to cost me this time? Is my coupon still good? Is the coupon not good? Is this medicine that I’ve been taking for the past two years and costing me $25 a month because of the coupon–all of a sudden now I don’t have any more coupons–and now it calls $400 a month,” DeNunzio says.

DeNunzio has gone to Canada and Mexico to fill his prescriptions before, however, local pharmacists have also helped find him coupons to reduce the cost of his prescriptions.

But what DeNunzio and other Americans pay at the pharmacy counter is only part of the story.

Medicare, one of the largest purchasers of prescriptions in the country, has to pay for certain drugs regardless of price. This, in turn, drives up the cost of these medications for everyone.

There are also companies called Pharmacy Benefit Managers (PBMs). They negotiate prices between manufacturers and pharmacies. But pharmacists have accused them of overcharging pharmacies and pocketing the difference, something the PBMs deny.

Dr. Rena Conti from Boston University says PBMs have helped keep prices for generics low. Brand name or newer drugs, however, are a different story.

“Their business model is predicated in part on buying low and selling high. They don’t necessarily face the strongest incentive to pass off those discounts and rebates that they get to patients at the pharmacy counter,” Conti says.

That’s something John Hansen from Taylorsville found out when a billing company affiliated with a PBM charged his insurance 10 times the normal rate for the medications he needed. Hansen had been hit by a drunk driver and discovered the charges as part of a court case.

The pharmacy he went to was paid about $3 for each medication while the billing company made more than $100 per prescription.

“It was a guaranteed amount that shows how certain companies will insert themselves for maximum profitability not maximum benefit,” Hansen says.

Hospitals, insurance companies, and sometimes pharmacies buy low and sell high as well.

For example, Walgreens had profits of over $4 billion in 2018, mostly from filling prescriptions. In its defense, Walgreens says 97% of prescriptions filled there, “are paid for using some form of insurance coverage or savings program.”

The biggest question for many people is why insulin prices are so high since it’s an off-patent drug with several choices.

Insulin manufacturers have been sued for colluding, as some brands have raised their prices by similar amounts several times since 2008.

Whether that’s true or not, there is another issue. Because of a law passed in 2010, the FDA has until March of this year to approve any new generics for insulin. If they do not, companies will have to reapply to get their medication approved. And it usually takes about a decade for a new drug–even one that’s a low cost, life-saving alternative–to legally come to market.

In 2019 and 2020, the FDA approved a pair of generic Insulins. But they are manufactured by Novo Nordisk and Eli Lilly, some of the companies accused of colluding on prices. Some patients and pharmacies have also been reporting shortages or been taking the companies to task for not promoting the generic forms, something the companies deny.

We want to hear from you.

Have a story idea or tip? Send it to the KSL NewsRadio team here.

Health

Myrtle Spurge is often touted as deer-resistant and drought-tolerant, but the plant is rapidly inva...

Eliza Pace

Salt Lake County Health warns of harmful myrtle spurge plant

Myrtle spurge was originally introduced to Utah as a decorative plant but is an invasive species that has spread to natural areas.

5 hours ago

Dairy cows across the country, specifically in Texas, Kansas and New Mexico are getting sick with a...

Alexandrea Bonilla

Cows across the country are getting sick with a “flu-like” illness

Utah is altering the requirements for livestock brought into the state after multiple cows across the country have gotten sick with a flu-like illness.  

16 hours ago

Over 30% of people in Utah are considred prediabetic because of the amount of soda they drink....

Amanda Dickson

Is Utah’s soda obsession behind our levels of prediabetes?

Here in Utah, our soda drinking habits might be making us particularly at risk for prediabetes and diabetes.

23 hours ago

A hand holds a tablet stamped with "MF," standing for mifepristone....

CNN

Study shows how self-managed abortion became more common, as Supreme Court abortion drug hearing looms

Medication abortion has become increasingly common since it first became available in the United States two decades ago.

2 days ago

Small screens...

Don Brinkerhoff

Small screens impacting the mental health of kids says study

The increased use of small screens by kids and teens may be linked to increased mental health issues according to a study.

2 days ago

bottles of prescription medication at a desk. 16.2% of Utahns are unable to get the prescription me...

Tammy Kikuchi and Emma Keddington

Utah ranks second in the nation for prescription medication shortages

The hardest prescription medication to get is for ADHD, cancer and high blood pressure.

3 days ago

Sponsored Articles

Mother and cute toddler child in a little fancy wooden cottage, reading a book, drinking tea and en...

Visit Bear Lake

How to find the best winter lodging in Bear Lake, Utah

Winter lodging in Bear Lake can be more limited than in the summer, but with some careful planning you can easily book your next winter trip.

Happy family in winter clothing at the ski resort, winter time, watching at mountains in front of t...

Visit Bear Lake

Ski more for less: Affordable ski resorts near Bear Lake, Utah

Plan your perfect ski getaway in Bear Lake this winter, with pristine slopes, affordable tickets, and breathtaking scenery.

front of the Butch Cassidy museum with a man in a cowboy hat standing in the doorway...

Bear Lake Convention and Visitors Bureau

Looking Back: The History of Bear Lake

The history of Bear Lake is full of fascinating stories. At over 250,000 years old, the lake has seen generations of people visit its shores.

silhouette of a family looking over a lake with a bird in the top corner flying...

Bear Lake Convention and Visitors Bureau

8 Fun Activities To Do in Bear Lake Without Getting in the Water

Bear Lake offers plenty of activities for the whole family to enjoy without having to get in the water. Catch 8 of our favorite activities.

Wellsville Mountains in the spring with a pond in the foreground...

Wasatch Property Management

Advantages of Renting Over Owning a Home

Renting allows you to enjoy luxury amenities and low maintenance without the long-term commitment and responsibilities of owning a home.

Clouds over a red rock vista in Hurricane, Utah...

Wasatch Property Management

Why Southern Utah is a Retirement Paradise

Retirement in southern Utah offers plenty of cultural and recreational opportunities. Find out all that this region has to offer.

Plenty of blame to go around on high drug prices