Prescription Drug Costs

Prescription drug costs are out of control

Rx costs are soaring.

Prescription medications are vital to the health of many New Mexicans. But soaring costs are causing financial distress and locking people out. A recent survey found this is the number one health care issue on consumer’s minds. Data show that drug costs will be the fastest growing component of the health care system this year. And the US already pays vastly more than any other country for the exact same medications, which is reflected in the massive profits that the industry rakes in.

PROJECTIONS OF MOST PROFITABLE INDUSTIES IN 2016

Why are drug costs soaring?

First, there is little competition in the prescription drug market. The patent system, FDA exclusivity and trade agreements create government-granted monopolies for brand name drugs. And now, we are seeing unprecedented spikes in the cost of many generic drugs, driven by industry consolidation, inflated prices, raw material shortages and agreements among drugmakers. The second major reason that costs are soaring is that pricing is based on “what the market will bear.” This means that prices are often not tied to the costs of research and development, manufacturing or the impact on health. There is also evidence that pharmacy benefit managers (the middlemen who administer drug benefits for employers and health insurers) have illegally made concessions on the price of drugs. The role of these middlemen needs more scrutiny.

How can we get a handle on drug costs?

Given that there is no true competition in the drug industry, we must reform the dysfunctional marketplace. The first steps will be shedding light on how prescription medications are priced and curbing the monopoly power that drug companies currently take advantage of. We must also consider taking actionsthat every other major country has to negotiate lower prices for drugs to reduce the burden on consumers, businesses and the taxpayer.

TAKE ACTION

1) Share your story with Health Action NM by emailing it to info@healthactionnm.org. We will abide by any confidentiality requests that you have.
2) Ask your national and state lawmakers to support bills that increase transparency in the drug industry and reduce costs for you and your family.
3) Share a message about this issue on Facebook or Twitter.
4) Sign up for monthly Prescription Drug Cost mobile updates by texting “RXCOSTS” to 51555 or click here.

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