End the Great American Drug Heist

Robert Borosage

This week, Sen. Bernie Sanders took on Big PhRMA, the all-powerful prescription drug company lobby, by demanding an end to the Great American Drug Heist.

Americans pay the highest prices for prescription drugs in the world – even though taxpayer money supports much of the research that develops the drugs. Drug costs increased nearly 11 percent last year, more than double the rise in overall medical costs. This when prices generally were up less than 1 percent. One in five Americans, Sanders noted, don’t fill a prescription because of its cost. Lives are lost because drugs are too expensive.

As Sanders noted, we spent about 40 percent more on prescriptions in 2013 than they did in Canada, the industrial country with the second most expensive drugs. Our costs were nearly five times per person than those in Denmark. When they spend $20, we spend $100 on the same prescription. Think about that.

And if nothing changes, it will get more ridiculous. Medicare projects that drug costs will continue to rise about 10 percent a year for the next decade. Millions more Americans will simply be unable to afford the drugs they need.

This isn’t because drugs are expensive. This is because we are getting robbed. And we’re getting robbed because our politics is utterly corrupted. The drug companies have rigged the rules to make out like bandits.

As Sanders put it:

Our drug costs are out of control because that’s the way the pharmaceutical companies want it. Other countries have national health insurance like the Medicare For All plan I have proposed, and these national plans are able to negotiate better prices. In this country, however, drug lobbyists have been able to block Medicare from negotiating better prices on behalf of the American people.

Yes, he got that right. Congress actually voted to prohibit Medicare from negotiating bulk discounts on prescription drugs. There is no excuse for this except corruption.

When the Bush administration put together the prescription drug bill in 2002, it invited lobbyists into help draft the bill. As Jacob Hacker and Paul Pierson detail the story in their book “Off Center,” the drug industry contributed nearly $30 million in the 2002 election cycle, three-fourths to Republicans who controlled the White House and the Congress. In 2003, the drug industry spent more than $100 million on federal lobbying. The drug companies established fake grass-roots groups. The conservative direct mail front, United Seniors Association which featured the notorious Republican lobbyist-crook Jack Abramoff on its board, organized a full court press.

It gets worse. The projected costs of the bill were so high that the Bush administration suppressed the true costs. Thomas Scully, the head of Medicare, threatened to fire the Medicare actuary if he released the real numbers. He then left the government to become a lobbyist for the major drug companies. Billy Tauzin, the chair of the House Committee that wrote in the bill and the ban, ushered them through the House and rolled the compromised Senate Democrats in the conference committee. A few months later, he retired to become the head of PhRMA, the drug companies chief lobby, at a cool $2 million a year. You can’t make this stuff up.

Democrats railed against this outrage in election after election. But when Barack Obama pushed to pass comprehensive health care reform, he had to figure out how to overcome the big money lobbies of the insurance companies and the drug companies. One of the first deals cut by Rahm Emanuel, then his chief of staff, was to extend the ban on Medicare, thereby buying the silence of Big PhRMA. And insuring that the Great American Drug Heist continues to this day.

Sanders detailed a five-point program for ending the rip-off. Repeal the ridiculous ban on negotiation bulk discounts for seniors. Make it easier for Americans to purchase drugs on-line from Canada where they are cheaper. Crack down on drug company fraud by stripping them of patent protection for any drug fraudulently manufactured or sold. End “pay for delay,” the scam where a drug company producing an expensive brand name drug bribes another company to delay protection of a cheaper generic drug. And force transparency from drug companies to expose the reality that taxpayers are paying for most of the R&D that goes into drugs, while the companies’ R&D is focused on how to package and market the resulting breakthroughs to pocket maximum profits.

There is no more obscene example of how big money and special interests corrupt our politics to rig the rules against Americans than the Great American Drug Heist. CAF has campaigned against this grotesquerie for years. Sanders is right to expose the scam. It is preposterous that this rip-off has now lasted for over a decade.

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