BioPharma, short for biopharmaceuticals, are drugs and medical treatments that are derived from biological sources rather than synthetic, or totally artificial, ones. The pricing of these pharmaceuticals is a point of contention, with the production of some of these drugs requiring a large investment of capital.
In the United States, there is limited oversight on drug pricing, though there are calls to address this issue through legislation. Ultimately, more stringent regulations on drug pricing are imperative.
Insulin is a prime example of high drug pricing. One-third of Americans living with diabetes require insulin to treat their condition. The out-of-pocket cost of insulin is a major expense, and approximately one-fourth of diabetic patients underuse or altogether skip doses of insulin to save money.
Under the Trump administration, the out-of-pocket cost of insulin was reduced, though primarily only for senior citizens. In the case of high deductible insurance policies, many patients are required to pay the full price of insulin primarily out-of-pocket until their high deductible has been met. This issue becomes more complicated as newer, more effective versions of insulin enter the market.
Though the FDA evaluates the efficacy of biopharmaceuticals and regulates their commercial distribution, the actual price of drugs is minimally regulated.
The case of Martin Shkreli and Daraprim, an antiparasitic drug used in HIV patients, is an alarming example. In 2015, Shkreli’s pharmaceutical start-up, Turing Pharmaceuticals, raised the price of Daraprim from $13.50 to $750 overnight. This price hike placed an enormous burden on HIV patients. This is not an isolated event, with some pharmaceutical companies rebranding older, underused drugs and raising their prices to increase profit margins.
The issue of drug pricing becomes even more complicated when considering generic versus name-brand pricing and patenting. Once the patent on a name-brand drug expires, it can be produced at a lower cost by other pharmaceutical companies at the same standard and quality as the original. However, not all drugs have a generic alternative, so certain medications have exorbitantly high out-of-pocket costs.
Policy intervention is necessary to address drug pricing in the United States. There have already been some efforts.
Proposed on March 23, 2021, by Sen. Bernie Sanders, the Prescription Drug Relief Act of 2021 intends to end “government-granted monopolies” in the pharmaceutical industry and regulate drug prices based on the median price of the drug in other countries.
President Joe Biden has included in his Build Back Better infrastructure plan, which has already passed through Congress, a prescription drug policy within the framework of Medicare.
Approval of the Sanders bill and others like it would mean that the unfettered power of the pharmaceutical industry would be reduced, and drug pricing would be more tightly regulated. Congress should continue to pass such legislation. Lives depend on it.
(The opinions expressed in this article are those of the individual author, whose information can be found below.)
Sahiti R. Karnati was a Healthcare intern for ONC during the Spring 2022 semester.
Sources:
Center for Drug Evaluation and Research. “Generic Drug Facts.” U.S. Food and Drug Administration, FDA, https://www.fda.gov/drugs/generic-drugs/generic-drug-facts.
Cohen, Joshua. “Insulin's out-of-Pocket Cost Burden to Diabetic Patients Continues to Rise despite Reduced Net Costs to Pbms.” Forbes, Forbes Magazine, 5 Jan. 2021, https://www.forbes.com/sites/joshuacohen/2021/01/05/insulins-out-of-pocket-cost-burden-to-diabetic-patients-continues-to-rise-despite-reduced-net-costs-to-pbms/?sh=5052b37a40b2.
Pollack, Andrew. “Drug Goes from $13.50 a Tablet to $750, Overnight.” The New York Times, The New York Times, 20 Sept. 2015, https://www.nytimes.com/2015/09/21/business/a-huge-overnight-increase-in-a-drugs-price-raises-protests.html.
“S.909 - 117th Congress (2021-2022): Prescription Drug ...” Congress.gov, https://www.congress.gov/bill/117th-congress/senate-bill/909.
“President Biden Announces Prescription Drug Pricing Plan in Build Back Better Framework.” The White House, The White House, 2 Nov. 2021, https://www.whitehouse.gov/briefing-room/statements-releases/2021/11/02/president-biden-announces-prescription-drug-pricing-plan-in-build-back-better-framework/.