The Ethics of Pharmaceutical Pricing

The Ethics of Pharmaceutical Pricing
June 1, 2022 No Comments Vision of Justice Giordan I. '23

Profit vs Access: An Ethical Commentary to Pharmaceutical Pricing in Relation to Patient Access

By Giordan Ismael

Image by Myriams-Fotos from Pixabay

Medical costs have been drastically increasing for many Americans. One factor that has influenced increases in the healthcare spending category is the increase of prescription drugs. Currently, there are limited regulations regarding the pricing for prescription drugs which allows pharmaceutical manufacturers to maximize their profit. This forces stakeholders in the pharmacy supply chain to change their plans, payments, and interactions with each other to offset the increasing cost burden. These adjustments, along with higher overall prices, too often prevent patient access to their prescribed medication. This paper will focus on the causes and effects of rising prescription drug prices in the United States and their relationship to consumer access. With this, I will be evaluating which stakeholders have a responsibility for rising drug prices and who should take responsibility for market regulation. When viewing consumer accessibilty, I will assess the positives and negatives of increasing prescription drug prices and whether concerns regarding access should be prioritized over profit considerations.


Table of Contents


Abstract

In 2019, the United States as a whole spent 3.8 trillion dollars on healthcare, which is approximately ninety percent more than other industrialized nations. Of that 3.8 trillion dollars, 507.9 billion dollars alone was spent on prescription medications. Currently, limited regulation with prescription drug pricing allows pharmaceutical manufacturers to maximize their profit. Other factors that exacerbate rising drug prices include the overuse of patents and market exclusivity as well as the need for other stakeholders to make a profit. As a result of rising prices, patients have reduced access to their medications, many of which are needed to maintain their wellbeing. The situation raises the ethicality of high prescription drug prices and whether a product that holds immense value should be denied to patients because of the price. This paper will explore the relationship between rising prescription drug prices in the United States and consumer access. I will evaluate specific examples of drugs that have experienced drastic increases over the years and compare federal drug pricing regulations of the United States to other countries. With regards to ethics, I will assess which stakeholders have a responsibility for rising drug prices and who should take responsibility for market regulation. I will also look at how drugs can be priced to provide the greatest amount of equality to the patient population.


The Pharmaceutical Pricing Situation in the United States

Healthcare spending in the United States is higher than any other developed nation in the world, and it has been for many years. A part of this increased spending is due to the growing spending category in prescription drugs. The United States spent 3.8 trillion dollars on health care in 2019, which is 17 percent of the Gross Domestic Product (GDP) (National Health Expenditure Projections). Out of that 3.8 trillion dollars, prescription sales accounted for 507.9 billion dollars, which was a 5.4 percent increase from 2018 (Tichy et al.). The Center for Medicare and Medicaid (CMS) has found that this increasing number is mostly credited to the costs of treatment being higher and not because of increasing disease rates within the population or higher rates of patient utilization. In fact, prescription drug usage has slightly decreased within the past decade (as of 2016) (Martin et al.).

Drug pricing trends over the years indicate that these spending increases are not recent but have been happening for decades. When viewing drug spending per capita, with inflation adjustments, retail prescription drug spending increased from 90 dollars in 1960 to 1,025 dollars in 2016 (Kamal et al.). Looking into the future, the CMS predicts that national health care spending will be 6 trillion dollars by 2027, growing on average 5.5 percent each year and that the spending on retail prescription drugs will outpace all other health spendings as the fastest growing health category. However, there can be multiple explanations for this prediction besides drug price increases. For example, an introduction of new drug technologies can also be a possible cause. Though looking at varying causes can create several nuances to the claim, one study supports the argument that increasing drug prices will indeed contribute to a fast spending growth category. This study found that when the prices of seven widely used pharmaceutical drugs were significantly raised in 2019, drug spending increased an extra 1.2 billion dollars that year. The report, which was conducted by the Institute for Clinical and Economic Review (ICER), concluded that these drug companies had “lacked adequate new evidence to demonstrate a substantial clinical benefit that was not yet previously known”, meaning that the rising price of the drug did not reflect an increase in the value it brought to its patients (ICER Identifies Most Significant 2019 US Drug-Price Hikes). These rising “unjustifiable” prices work to reduce patient access to medications, which raises the question of the ethicality of the action. 

How the Pharmaceutical Supply Chain Works

The pharmaceutical supply chain is an intricate system in which all the stakeholders rely on each other to carry out their functions. The major stakeholders consist of the patient, the physician, the insurance company, the pharmaceutical company, and other third parties. As pharmaceutical products are passed on from stakeholder to stakeholder, the price of the drug fluctuates. Therefore, there can be several prices of a drug, depending on where one looks in the pharmaceutical supply chain. 

The list price, also known as the wholesale acquisition cost (WAC), is the initial price of the drug set by the manufacturer. However, this is rarely the price paid by most patients since the price decreases as the drug moves down the supply chain. The product is sold from the manufacturer to intermediaries, like pharmacy benefit managers (PBMs) and wholesalers, who receive discounts on the list price. Intermediaries then sell the drug to pharmacies, and from there, physicians can prescribe medications for their patients. The physician or the intermediary gets reimbursed by the patient’s insurer (if insurance coverage is applicable). Reimbursements are covered by monthly premiums paid by customers to their insurance companies. Depending on the drug, patients may or may not have to pay a copay or coinsurance to help cover the cost as well. Ultimately, the physician makes the decisions on what to prescribe, the insurance company chooses which prescriptions to cover, and the patient pays for it through monthly premiums and copays to the insurer.

The format of payment differs between private insurance users, those who are covered by Medicare and Medicaid, and those with no insurance. The majority of private insurance comes in the form of employer-based coverage, where the employer covers most of the monthly premiums. The employee or employee’s family is typically responsible for covering deductibles and other cost-sharing requirements. Deductibles are an amount of money that must be paid out-of-pocket before the insurer will cover the rest of the cost. In 2019, around 68 percent of the American population was covered by private insurance (Starkey and Bunch). Medicaid is a public insurance program that provides coverage and financial support to low-income citizens. Medicaid extends to about 20 percent of the population. It is jointly funded by the federal and state governments, but administered by the state, giving each state some flexibility in determining who is covered and what services are covered by Medicaid. Medicare is another public insurance plan that provides coverage to citizens of ages 65 and older and certain younger people with disabilities. There are four parts to Medicare: Part A, B, C, and D. Part A covers hospital insurance while Part B covers medical insurance. Part D provides prescription drug coverage, and Part C, also called Medicare Advantage, offers alternative plans to parts A, B, and sometimes D. For those who are uninsured, which comprises 8 percent of Americans, there are numerous third-party foundations and manufacturer patient assistance programs willing to help make drug payments more manageable. Organizations that offer discounts include GoodRx, Walmart, and other pharmacies. Overall, patients rarely have the burden of covering the full cost of a drug. There will certainly be fluctuations in the amount each patient pays—some may pay less than 100 dollars while others may end up paying a few thousand for certain medications—but frequently groups and parties are willing to provide some economic relief to the patient.

Calculating Drug Costs

When calculating drug costs, the main concern for drug companies is to price their products so that their revenue satisfies company expenses and operating costs. This can prove to be a challenging task, as it includes employee salaries, facilities, taxes, philanthropic pursuits, and, most importantly, the cost of research and development (R&D) for a drug. According to a study done by the Tufts Center for the Study of Drug Development, it costs about 2.6 billion dollars and an average of 10 years to develop and market a new drug (Wapner). Companies must also be able to compensate for the cost of failed drugs, another challenging task. One study found that ninety percent of drugs that enter phase one of clinical development fail to progress to the next phase (Henry). 

The size of the market in which a drug competes also has substantial influence over drug pricing. In general, when the market size is smaller, the drug might be expected to be expensive. However, a larger market can render a greater profit, allowing pharmaceutical companies to have more flexibility when determining the price of their drug since they are not tied to the constraints of having fewer consumers. Drug companies must also compare their prices to the prices of competitors and previous drugs if these factors apply to their market. As a general rule of a free-market economy, competition drives down prices. Companies also realize that lower prices help ensure product demand. 

The clinical value of a drug adds another layer to a drug company’s pricing decision. Drug companies may have the incentive to set their prices low to beat competition, but if their drug proves to be more valuable than these other treatments, then this may allow them to set higher prices. This is because high value increases consumer demand. If a drug renders great value to a patient by its ability to help them live a longer, fuller life, then they are willing to pay more. This situation brings in the concept of an inelasticity of demand for drug products. Since the demand for many pharmaceuticals will remain stable for the foreseeable future, especially for drugs that possess life-improving and life-saving qualities, prices can be increased without fear of a decrease in demand. The question for the pharmaceutical company then becomes: What can be charged based on the value of a drug? This question will be discussed more in-depth in the “Ethics Concerning Equality” section of this paper. 

Other factors that drug companies have to be mindful of when pricing their products are the legal rules and market constraints of the industry. One major constraint comes from insurance companies. Insurance companies are less likely to cover costly drugs if doing so will exceed their yearly budget. This provides some incentive for drug companies to maintain prices that will allow them to secure a spot on insurance formularies, which are lists of drugs that insurers offer to their customers. However, this area becomes a little grey due to the role of pharmacy benefit managers (PBMs) that act as middlemen between drug companies and insurance companies and ultimately decide which drugs will make it to insurance formularies. I will further discuss PBMs in a later section of this paper. 

Though the United States government does not directly regulate drug prices, there are a few federal programs that have been created to manage some drug costs. One program is Medicaid’s “Best Price Rule”, which requires manufacturers to offer Medicaid programs the lowest available commercial price of their drug. However, there have recently been some changes to manage this rule. As of December 22, 2020, the Trump administration finalized another rule that would allow changes to the Best Price Rule, providing a chance for value-based approaches to be considered when negotiating prescription drug prices with Medicaid programs. Instead of paying one “best price” for each drug, multiple best prices will be allowed to be negotiated, leaving room for government programs to negotiate prices based on health outcomes.

“This change will help ensure that when patients use a copayment assistance card provided by a drug manufacturer, the value is passed through to the patient’s deductible or cost sharing obligations in full, as opposed to offsetting what the health insurance company would have to normally reimburse the pharmacy,”

-The Center for Medicare and Medicaid Services (CMS)

This will be useful when negotiating specialty drugs such as gene therapies and biologic drugs, which have become widely popular within the last decade and whose cost burdens have often caused the most strain amongst insurance programs and companies. This new rule will allow manufacturers to “proportionally allocate the discounts provided under a value-based pricing arrangement, based on actual patient outcomes across the total dollar value of the drugs dispensed to all patients under that arrangement” (Pifer). The CMS predicts that the rule would save federal and state governments up to 228 million dollars by 2025. However, in some cases, value-based agreements might prevent Medicaid from receiving the actual best price. It is important to note that this new rule will aim to align prices and value, which is different from focusing on lowering prices.

Another program created by the government is the 340B drug pricing program. It allows qualifying providers, or Covered Entities (CE), to help under-insured and uninsured patients manage the financial burden of their medications. Centers that are eligible to apply for the 340B program include hospitals, health care centers, and specialized clinics. Once part of the program, drug companies are obligated to offer these Covered Entities a 20-50% discount on their drugs. Drug companies must do this in order to be included on Medicare and Medicaid covered drug lists. Then, CEs that are part of the program and receive discounts still charge full price for these medications to insured patients to extract the full price from the insurance companies. Through this transaction, the CEs make a profit, also known as the “340B savings”, which they then direct towards low-income or uninsured patients. The 340B program provides sizable discounts and benefits to participating centers, but it should be noted that the program accounts for less than 3 percent of all drug purchases in the United States. Other than these two rules, few other federal laws work to regulate drug prices in the pharmaceutical industry.


Specific Examples of Rising Drug Prices

With all these statistics, it would be helpful to provide specific examples of prescription medications that have either experienced many “price hikes” over the years or arrived at the market with a high price tag.

Humira

The drug Humira, owned by the company AbbVie, is an example of a drug that has maintained market exclusivity and has therefore been able to raise drug prices. It is a biologic drug, meaning it is made out of living cells, that is used to treat rheumatoid arthritis, psoriatic arthritis, Crohn’s disease, and other long-term conditions that affect the immune system. It is the top-selling drug in the US, with a revenue of 13.7 billion dollars in 2018 and an average retail price of 8,495.94 dollars per month (Rowland). This price increased by 7.4 percent at the beginning of 2020, despite public outrage and pressure. And before that, the drug price increased a total of 19 percent from 2017 to 2018. Critics have investigated these price increases and in several reports have deemed them unjustified. AbbVie credits this price increase to net price, saying that it is done to “stay in line with the projected rate of inflation”. However, review committees such as ICER have rejected this argument, saying that the increased price does not reflect the drug’s added value to the market. Despite the high retail price, most private insurances have Humira on their formularies because of its popularity. Humira is also covered by Medicare Part D and some Part C plans. For those without insurance, manufacturer and pharmacy coupons help offset the retail cost. AbbVie has a history of using aggressive tactics to maintain dominant market positions with Humira, such as the use of patents and dealmaking with generic brands to prevent market competition. The United States Food and Drug Administration (FDA) approved Humira in 2002 when AbbVie also acquired many core patents that allowed Humira to be the dominant drug in its market for years. Although many of the original patents are now expired, Humira has recently won additional patents, some of which will not expire until 2034, giving AbbVie more time to maintain strong market positions. Currently, Humira has 136 patents that prevent recently approved biosimilars from entering the market until at least 2023. These patents have been described as “patent thickets” (Rowland). As a result, the concern of generic competition is not an issue when pricing their drug, allowing AbbVie to raise their prices without much constraint.

“Patent thicketing, and Humira is the poster child for this, builds a patent fortress around their product to protect their ability to continue their monopoly pricing.’’

-Christine Simmon, senior vice president at the Biosimilars Council

The EpiPen

Epi Pen” by Vu What When is marked with CC BY 2.0.

Similar to Humira, the EpiPen is another drug whose dominant market position has allowed drug company Mylan to raise their prices to unreasonable amounts. EpiPen is a brand name of the drug epinephrine that is used to combat allergic reactions. Epinephrine is a common drug that in theory should be relatively cheap since it only costs a few dollars to make, and it also has immense value to those who suffer from severe allergic reactions. It is usually given in extreme situations when a patient enters anaphylaxis, where there is a risk of unconsciousness and death. Despite its simplicity, the average retail price for the Epipen was 669.82 dollars in 2020. This price reflects the amount a person might pay without insurance or any other prescription drug coverage. The price varies depending on your insurance plan; those without insurance can meet the requirements for the Mylan savings program, Medigap coverage, or a low-income subsidy plan. 

The FDA first approved the EpiPen in 1987 and it was acquired by the drug company Mylan in 2007. At the time of acquisition, the price was 57 dollars. In 2016, the price was over 600 dollars (Henry). After Mylan obtained the EpiPen, it began producing 90 percent of all anti-allergy injectors on the market, meaning that the company had achieved a dominant market position. Competition in the market decreased since there was less incentive for generic companies to compete against a popular brand-name drug. With little competition, Mylan raised the prices of the EpiPen by 400 percent from 2011 to 2016 (Willingham). In 2016, there was a public outcry against Mylan and the skyrocketing prices of EpiPens. This forced Mylan to produce a generic version called “EpiPen: epinephrine” which currently costs about 396.41 dollars, about half the price of the brand-name (Goodman). These high prices raise the ethical question of whether the price of a simple, widely used drug that provides lifesaving abilities to its users should be placed at a price that patients may struggle to access and pay for.

Zolgensma

An example of a drug that entered the market with an already high price is Novartis’ specialty drug Zolgensma. Zolgensma is a gene therapy treatment for a rare genetic disease called spinal muscular atrophy (SMA) that affects around 10,000 to 25,000 people in the United States. SMA is characterized by a defective gene that damages muscle-controlling nerves and causes muscle weakness over time. SMA ranges in severity among five forms, from Type 0 to Type 4. Type 1, which is found in roughly 60 percent of SMA patients, can result in death by the age of 2. Types 2 through 4 are milder forms and can buy patients more time than those with Type 1. Common symptoms of SMA include trouble breathing, swallowing, and sucking, and some severe cases can cause major respiratory problems and an inability to walk. The one-time treatment Zolgensma is approved for babies under the age of two with all types of SMA. Zolgensma is not a definitive cure, but it does salvage the remaining nerves in the patient and prevents further nerve deterioration. After receiving the treatment, the patient might still need to attend therapy and receive other forms of care throughout their lifetime, but as of right now Zolgensma gives the best results out of any other drug on the market. 

Because of its unmatched ability to preserve a life with a one-time treatment, Zolgensma is the most expensive drug on the market priced at 2.125 million dollars. Many argue that the weight of what Zolgensma can offer when looking at the quality of life and life expectancy gained justifies the costly price tag. Others use this argument to condemn the price, saying that it greatly limits consumer access, as the majority of the population will struggle to find the means to pay for such an expensive drug. 

There are two other drugs on the market for SMA: Spinraza and Evrysdi. Spinraza costs 375,000 dollars a year for life, with the first year requiring 750,000 dollars worth of treatments. Patients receiving this treatment are required to receive several shots a year. Spinraza does not guarantee a cure nor does it ensure effective treatment compared to Zolgensma, which has a much higher rate of efficacy. The second drug, Evrysdi, is a daily oral medication that costs 340,000 dollars a year. This option can be more appealing to customers since it does not cost as much as Spinraza nor does it require painful injections. 

Even though there is public outrage over Zolgensma’s price tag, there are many arguments that justify the price. The first one being that the drug company must generate profits that will cover the cost of the drug’s development and provide funds for future drug innovation. However, with this specific example, the drug company Novartis bought a smaller company AveXis for $8.7 billion (Althoff). AxeVis already conducted the majority of the research for developing Zolgensma and several other drugs that Novartis was able to acquire. Therefore, Novartis did not have to take the gamble of researching and developing this complex drug, but instead simply acquired the knowledge and brought the drug to market. 

Another factor that may have influenced the price of Zolgensma is the market size and the impact of competition. Because SMA is a rare disease, the market size is small, which naturally drives up the price to ensure revenue. Compared to a popular drug with millions of users, such as Humira, Zolgensma only has a few thousand eligible patients. There is also competition in the market, which some speculate will help to bring down Zolgensma’s prices over time. But, even with competition, the constraint of a small market will work to keep prices relatively high, as there are only so many patients who are eligible to generate revenue. The value of what Zolgensma can offer also helps to explain the price since their one-time treatment and efficacy will persuade those with SMA to use Zolgensma over other existing treatments. 

Despite the compelling argument for Zolgensma’s controversial price tag, there are also several arguments against it. In 2019, The Institute for Clinical and Economic Review (ICER) released a report assessing the health benefits and cost-effectiveness of Spinraza and Zolgensma. The not-for-profit institute concluded that both drugs provided significant health benefits to their users in comparison to the prior available treatments. However, they disputed the prices, claiming that each drug was placed hundreds of thousands of dollars higher than it should be. By using the QALY system, a value-based approach that weighs the life-years gained and quality of life given to the patient after drug administration, ICER suggested that the yearly list price of Spinraza should be around 36,000 to 65,000 dollars a year and that Zolgensma should range between 310,000 and 900,000 dollars (ICER’s Assessment Finds Spinraza…). It should be noted that this value-based approach can be viewed as subjective as it is one of many ways to value life. However, this report does support the point that the price of a drug does not always proportionally reflect the given value.


Comparing Drug Pricing Internationally

The United States is the top spender on prescription drugs compared to all other developed nations. Even though prescription utilization rates are similar to other developed countries, drug spending per capita is still significantly higher in the United States (Sarnack et al.). In 2016, as previously mentioned, drug spending per capita was 1,025 dollars. The country with the next highest per capita drug spending was Switzerland at 783 US dollars. This may be due to the fact that the United States has very minimal pricing regulations compared to these other countries. The government does not regulate or approve of drug prices when they enter the market, and they do not negotiate national drug prices, either (with the exception of price negotiations for Medicaid and military veteran programs).

The United Kingdom

In the United Kingdom, for example, there is a strong government influence over drug pricing when new drugs enter the market. The United Kingdom has a governmental health body called the National Institute for Health and Care Excellence (NICE) that makes recommendations to regulate drug prices. NICE mainly looks at the cost-effectiveness of new drugs and compares them to existing and alternative drugs. NICE typically measures benefits through the QALY system or quality-adjusted life years. QALYs take into consideration the quality and the quantity of life given when looking at the benefits of a medication. Through NICE, the UK is able to maintain indirect control over drug prices, since drugmakers must abide by the cost-effectiveness threshold in order to have their drugs covered by the National Health Service, which provides health insurance to everyone in the UK.

Australia

Similarly, Australia has a government body and committee responsible for managing drug prices. The Minister for Health and Aging is responsible for putting drugs on the national formulary, but cannot do so until the Pharmaceutical Benefits Advisory Committee approves the drug. The committee mainly looks at the cost-effectiveness and budget impact of the drug when considering its approval. If approved, the committee will negotiate drug prices between the manufacturer and the government.

Japan

Japan uses an assessment called therapeutic value to determine whether a drug company will be able to receive reimbursements. Therapeutic value is a way to measure the efficacy of a treatment by comparing the ratio between the Number Needed to Harm (NNHtotal) and Number Needed to Treat (NNT). Based on their decision, the Japanese government will decide whether to negotiate with the manufacturer. If the therapeutic value of the drug increases while it is on the market, then there will be price markups. Japan also refers to external prices of the drug to set their list price. Twice a year, the government looks at the list prices versus the prices actually paid by pharmacies and medical institutions and adjusts the list price to match the actual price. Since the actual price paid is usually lower than the list price, this means that the list price decreases over time. Japan is also working on implementing cost-effectiveness in their evaluation and usage to adjust prices.

Canada

The Canadian government regulates drug prices through the Patented Medicine Prices Review Board (PMPRB). They decide if a drug price is reasonable or excessive. If they deem the drug price too high, then the drug will not be included on the national drug formulary. There is also the Human Drug Advisory Panel, which reviews the drug through a scientific lens to determine the efficacy of a drug in its treatment abilities. They provide the scientific information that aids the PMPRB in their pricing review.

Study Comparing Countries

 A 2019 study compared the prices of 79 brand-name drugs in the United States to Canada, Japan, and the United Kingdom. The study found that drug prices were on average 220 to 310 percent higher in the United States than in the other countries after rebates were included. It was also found that the longer a drug stayed on the market, the greater the price difference became in the US than the other countries. This is because in the US drug prices tend to increase after market launch, while in other countries the prices usually decrease. As explained above, other countries use various mechanisms to manage drug prices after market launch, while the United States government allows drug companies to increase drug prices based on the market situation (Kang et al.). This shows that without proper regulation, drug prices will go up, as the drug companies themselves are not doing much to manage their prices.


Causes of Rising Drug Prices

Introduction of Specialty Drugs

Several factors have contributed to the increase in drug prices, with the first one being the growing market for specialty drugs. Specialty drugs are highly complex drugs that come at a higher price than normal name-brand or generic drugs. These drugs are often life-saving or reap greater benefits to their targeted patients, due to their complexity and ability to treat rare diseases. As utilization shifts to new specialty drugs, it will contribute to the overall spending in the pharmaceutical category (Hanna et al.).

Patents and Market Exclusivity

Another contributing factor to rising pharmaceutical prices is the use of patents and market exclusivity to gain dominant market positions. Patents are government-sanctioned licenses that are used to protect a drug company’s research and development investments, while exclusivity provides delays and prohibitions of competing drugs (Frequently Asked Questions on Patents and Exclusivity). Patents can be issued at any time during a drug’s development, while exclusivity can only be granted to drugs that have been approved to enter the market. Patents and exclusivity can run concurrently as patents protect the drug and exclusivity protects the market of the drug. 

Patents are granted by the US Patent & Trademark Office (USPTO) and last 20 years. However, it takes on average 10 years for a drug company to develop and license a patented drug, giving them only another 10 years before losing patent protection. Patents are also not easily given. The process of receiving a patent can be long and complicated and plenty of patent requests are commonly rejected. However, many studies have found that drug prices increase over time under patents since they work to delay the development of generic versions and reduce competition. As stated before, drug prices are minimally regulated, giving drug companies the freedom to push prices to maximize profit, which can contribute to a decrease in patient access to the drug. In some cases, drug companies may make changes to their drugs, such as the formulation and dosage in order to receive more patents. There is also a concept called “pay for delay”, which occurs when a brand-name pharmaceutical company pays generic manufacturers to delay their market entry. This tactic was used with Humira, whose maker, AbbVie, made deals with generic companies to not enter the market until at least 2023. 

Even though drug companies take advantage of patents and use them as a tool to maximize profit, there would be market failure without them. If patents did not exist, generic drug companies would replicate brand-name drugs as they enter the market and sell them for lower prices, diverting the profits away from brand-name companies. This would allow companies to benefit from another company’s research without having to pay for it. Patents also create incentives for innovation. For example, when a product is patented, other companies may try to create a new kind of drug that does not violate the patented drug. This also helps to create competition in the market. 

There are several reasons why a drug can receive market exclusivity. Market exclusivity can range from 180 days to 7 years, depending on the type that is given. One popular form of market exclusivity occurs through the Orphan Drug Act, which allows companies selling a drug that treats an orphan disease (a disease that affects less than 200,000 people) to have 7 years of market exclusivity. The goal of this act is to stimulate the production of orphan drugs. As of January 2021, 564 orphan treatments were approved by the FDA, giving 838 rare diseases an option of treatment. It has been found that 80 percent of these approved orphan drugs work to treat rare diseases exclusively (Huron). However, some drug companies have tried to abuse this special grant: for example, AbbVie’s Humira. AbbVie argued that Humira treats the orphan disease uveitis, even though the main target of Humira is to treat people with rheumatoid arthritis, which affects 1.5 million Americans. Because of this, Humira was granted orphan status and was able to gain 7 years of market exclusivity for uveitis treatments.

Compensation of Stakeholders

Image from The Noun Project

Another cause of rising drug prices can be credited to the need for compensating stakeholders throughout the pharmacy supply chain. These stakeholders include Pharmacy Benefit Managers (PBMs), wholesalers, pharmacies, and insurance companies.

PBMs are businesses hired by insurance companies to manage drug benefit programs and to negotiate discount prices and rebates with drugmakers. They purchase drugs from pharmaceutical companies and then negotiate rebates in exchange for favoring their drug on insurance formularies. This causes pharmaceutical companies to raise their prices in order to manage rebates and ensure a profit. PBMs claim to help lower the cost of prescription drugs to millions of Americans, but they take a percentage of the negotiated prices to make a profit, preventing insurance companies and patients from receiving greater discounts. Here is an example of how this might work: A manufacturer sets their list price at $100. An insurance company hires a PBM to get the drug at a discounted price. The PBM negotiates the price to $80 but charges the insurer $90 for the drug (Pharmacy Benefit Managers Are Driving Up Drug Costs for Patients). PBMs also charge excess rebates and fees such as formulary administration fees, price protection fees, and purchasing discounts to make money. The negotiations between PBMs and manufacturers are kept secret, so there is no way of knowing the profit margins made by PBMs. This is just one of the many fallacies in the pharmaceutical industry where money that could be directed towards providing patients with access to drugs is lost, and it is maintained through a lack of transparency.

Newer Drugs and Higher Value

A final cause of rising drug prices has been credited to an increased production of newer drugs. The increased revenue generated from rising drug prices feeds into further production of drugs, as there is more money that can be used to research and develop these drugs. There is also a correlation between newer drugs, higher value, and higher prices. Consumers, in general, feel more comfortable using the newer products because they have more advanced and effective technologies. Take technologies such as iPhones, cars, and other machines as an example. Each previous innovation paves the way for new innovations to be created, and the same is mostly true for drug technology. Newer drugs will not only lead to higher prices but an increased value in the eyes of the patient. One study showed that patients with Type-2 diabetes prefered a newer, oral medication as their treatment instead of the older injectable treatment (DiBonaventura et al.). This high value may even make them willing to pay more for it. Therefore the pharmaceutical companies can charge more for newer drugs, as they know their patients may choose it over the older, less expensive drugs.

This increased value of a drug and a higher demand for it is also fueled by direct-to-consumer advertising. The goal of pharmaceutical companies is to generate patient demand for a drug through widespread information about new drug innovations. Advertising helps promote the value of a drug to the public, creating a link between high value and high prices that patients come to accept. Also, only brand-name drugs are advertised, giving them an advantage over generic drugs. Another way drug companies market their products is through detailing, which occurs when drug companies advertise their drug directly to physicians. Detailing works to further increase the knowledge about drugs, especially newer drugs, and persuades physicians to prescribe a certain drug over another. Detailing has been credited as the primary way in which drug companies generate sales for brand-name drugs.


Drug Pricing Outcomes and Responses

Effects on Patients

The consequences of rising drug prices are very evident in the United States. One of the hardest-hit stakeholders are the patients who have faced limited access to prescription medications. High prices make some drugs unattainable for patients and may force them to sacrifice other living expenses to pay for their medications. A study conducted in 2016 showed that 1 in 7 American adults refused prescription refills due to cost, and this number increases amongst adults who have two or more chronic conditions (Hanna et al.). This creates a negative downward spiral, as not taking the proper medications will lead to other costly health problems down the line. Another worrisome survey in 2019 showed that 1 in 4 adults struggled to pay for their medications (Kamal et al.). All of these patient responses make sense, since higher drug prices will naturally lead to patients being required to pay more for their medications, no matter what situation the patients are in. Those with private insurance will be required to pay higher premiums and cost-sharing contributions to aid insurance companies with the cost of rising drug prices. Government programs may become more rigid and exclusive in order to manage the cost burden, causing some patients to lose eligibility as a consequence of stricter eligibility requirements. Government plans might also choose to restrict access to high-costing drugs. And for the uninsured population, the out-of-pocket payments will be higher than those with insurance.

Effects on Insurance Companies

Additionally, pushback tactics from insurance companies further alter and limit consumer access to drugs. Like the pharmaceutical companies, insurance companies also need to generate revenue. Doing this requires many insurance companies to stay within their yearly spending budget on pharmaceuticals. If a drug is highly-priced, then insurers may be less likely to cover it since doing so could exceed their budget. However, if an insurance company chooses not to cover a drug, then that might leave the patient to figure out how they will pay for their prescriptions on their own, making patient access to medications more difficult to achieve. There are, however, many ways that insurance companies manage their payments for highly-priced drugs. 

Different health plans have different formularies. Again, a formulary is a list of drugs that insurers offer to cover for their customers. They try to find a balance between including the most cost-effective drugs and drugs that have high consumer demands, which are usually more expensive, brand-name drugs. For example, insurers might try to include a wide range of generic drugs in their formularies to help manage their spending on expensive drugs and improve their profit. This also works to control brand-name drug costs. However, patients might be looking for brand-name drugs, which are usually more expensive. That is why formularies work to provide a balance between the two. 

Insurance companies generally use tiered copays as an incentive for patients to use the generic or less expensive versions of a drug if the drug is an appropriate option for the patient. Doing so helps both the insurance company and the patient save money. To provide a simplified example: if a brand name drug is very expensive, then the insurance company might implement a high copay for it ($75) and keep the copay for the generic version of a competing drug low ($5). This will provide an incentive for the consumer to pick the generic drug, saving the insurance company money.

Next, there is a technique called prior authorization. Physicians must request prior authorization from the insurance company with certain drugs and must await approval before they can write the prescriptions for their patients. Because medications can be costly, insurance companies may only agree to cover a less expensive treatment instead of the desired medication. Physicians usually do not like requesting prior authorization. It can be time-consuming and burdensome for their staff to fill out forms and wait for the insurance company’s response. It can also delay the patient’s receipt of treatment for their condition.   

A more specific system of prior authorization is step-therapy. Insurance companies will rank drugs on tiers (from 1 to 4) on formularies in which patients are encouraged to use drugs on lower tiers before using higher-tiered products. Like the formularies, drug tiers vary by insurance company and program. Tier 1 requires the lowest copayment and is typically generic drugs, while tier 2 requires medium copayment and includes preferred brand-name drugs. Tier 3 drugs render high copayments on brand-name drugs and tier 4, the specialty tier, requires the highest copayment for drugs. Insurance companies are reluctant to cover drugs on tiers 3 and 4 as they tend to be very expensive, and they will persuade patients to use drugs on lower tiers before moving them a “step” up on the tier list.

Pushback from Policymakers

Besides the mitigation efforts from the insurance companies, there has also been pushback from policymakers on high drug prices. Recently, with the former Trump administration, there have been efforts to create laws and regulations aimed at improving transparency in the pharmaceutical industry. In October 2020, the Trump administration finalized a rule that would force private insurers to disclose negotiated prices with drug makers and pharmacy benefit managers. Aspects of the rule also focus on requiring insurers to disclose patient out-of-pocket estimates upon patient request. These changes will not take effect until January 1, 2022, if the Biden administration does not revoke the rule. This rule is a step towards providing transparency in the health care system and will allow patients to be more informed about their healthcare costs. It will also apply public pressure for insurers, PBMs, and drug makers to deliver the best prices possible to their customers. The Trump administration has also proposed using international drug prices to regulate US drug prices, which is similar to Japan’s external price policy.


Ethics Concerning Equality

Rising drug prices lead to a disparity in access, as some people will be more capable of paying for medications than others. Those of higher economic classes are better able to pay for highly-priced products compared to those in struggling economic conditions. This disparity is magnified considering access to prescription drugs has the ability to increase the quality of and prolong the life of patients. The value of prescription drugs and their inaccessibility for some thus accords with various socioeconomic inequalities, such as poorer individuals suffering higher rates of morbidity and mortality (Lawlor & Sterne). Because of this, I will argue that prescription drugs should be available at a price that makes them accessible to all of their consumers. Though in practice there is no guarantee for equal access to everyone, there should be an effort to ensure it by lowering prescription drug costs. This will provide more customers with the opportunity to receive the medication that their health care provider believes is right for them.

Image from The Noun Project

As a developed nation, there is notable pressure in the United States to help all citizens obtain a base standard quality of life. As the United States continues to grow in wealth and advance its technologies, there will simultaneously be a commitment to provide everyone with equitable access to vital resources. The question then becomes not whether we can and should provide everyone with access to life-improving resources such as prescription drugs, but rather, a question of when this will be achieved.

Right to Health and Right to Life

Health is a basic human right according to Article 25 of the UN’s Universal Declaration of Human Rights. It states that “Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control” (Universal Declaration of Human Rights). The UN has also established a right to life: “Everyone has the right to life, liberty and security of person” (Universal Declaration of Human Rights). Patients who cannot obtain access to the proper medications, especially if they are life-saving, run the risk of jeopardizing their health and possibly their life. That is why one of the first ways to work towards a more equitable health care system is by maintaining manageable prescription prices that will not extract huge cost burdens on individuals and health care programs. 

 “Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control”

-Universal Declaration of Human Rights

Aligning Price with Value

When I say that there should be “manageable prices”, this leads to the question of how these manageable or accessible prices should be determined. How do we find a balance between price and value that will also ensure equity in prescription access? As I have established, prescription medications (especially live-saving ones) have inelastic demand, so therefore the value is high. In other words, many patients will endure the financial struggle of finding a way to pay for their medications if it holds enough value to them. That is why a balance between efficacy and cost needs to be established so that patients do not overspend on drugs and so that access can be more easily obtained. This balance can be measured in terms of cost-effectiveness.  

The non-for-profit committee ICER uses a combination of two analytical methods to measure the cost-effectiveness of a drug: Quality of Life Years Gained (QALY) and equal value of Life Years Gained (evLYG). Their goal is to help policymakers with their decisions in determining the cost-effectiveness of treatments. The state of New York has used ICER’s evaluations when negotiating a best-price for Medicaid beneficiaries. Other groups have also used ICER’s reports such as the Veterans’ Administration, Harvard Pilgrim Health Care, Blue Cross Blue Shield of Massachusetts, UnitedHealthcare, and Kaiser Permanente.  

 “The goal of cost-effectiveness analysis is to help inform policy so that treatments that improve patients’ lives are rewarded fairly, while neither patients nor society overpays for care that doesn’t offer a significant benefit to patients”

-The Institute for Clinical and Economic Review (ICER)

ICER works to find a way to fairly price drugs that most accurately reflects their value with the goal of patients having the ability to access and pay for them. Quality of Life Years Gained (QALY) is deemed as the “gold standard” for measuring the effectiveness of a drug. If evidence shows that a treatment lengthens the life or improves the quality of life of a patient, these benefits are calculated into the amount of QALYs a treatment provides. Then, this treatment is compared to the amount of QALYs given to other treatments available to the same patient population. This evaluation also factors in the side effects of a drug, which can reduce the amount of QALYs a drug receives depending on the severity. 

Equal value of Life Years Gained (evLYG) is another method used to measure the cost-effectiveness of a drug. It measures the number of life-years gained, regardless of improved quality of life. This allows for all life to be measured equally and eliminates the risk of discrimination based on age, disability, or disease. Combined with the QALY method, ICER hopes to create a fair evaluation of drug prices that will help bring down drug costs. For example, with the drug Zolgensma, ICER concluded that when looking at the cost-effectiveness of the drug, the true price should be around 1.2 million dollars less than the current price. With a lower price tag such as this, families of babies with SMA can have a better chance at accessing a medication that will immensely improve the quality of life for their baby. 

“Cost-effectiveness should never be the sole factor in deciding fair pricing of health care interventions. But rejecting it would only serve to keep patients locked into the status quo – a broken system where drug makers charge whatever price they like, insurers respond with barriers to access, and patients struggle to afford and access the care they need. That would be a true ethical tragedy for our nation. Patients deserve better.”

-The Institute for Clinical and Economic Review (ICER)

The committee distinctly uses the phrase “ethical tragedy” to describe the projected situation for the pharmaceutical industry, and I agree with this description. The higher drug prices rise, the larger the inequality becomes between those who can and cannot pay for prescription drugs. To deny large sections of the population access to prescription drugs, and therefore to better health, is a cruel fate. Patients should not be struggling to access medications that they so clearly need.

Counterarguments and Consequetialism

While lowering drug prices may seem like a somewhat simple solution to the issue of access, many drug companies are not willing to do this. When looking at their side of the argument, many reasons can justify their high prices. It becomes a question of if these reasons can outweigh the problems that occur with patient inaccessibility to the proper medications. 

When looking at the situation through the framework of consequentialism, some may argue that the negative consequences of regulating pharmaceutical prices outweigh the benefits of providing equitable access to users. If drug prices decrease, this means that there will be a decrease in revenue for the pharmaceutical companies. Without enough revenue to fund future projects and to invest in research and development, there will be a decline in innovation. This could lead to less production of effective cures and treatments for diseases in the future, especially with rare diseases. Biologic drugs that treat rare diseases are often the most costly to produce, so a decrease in funding could discourage drug companies from taking chances with developing these specialty treatments. There could also be less money to fund in-depth clinical trials, leading to less information about the safety and efficacy of a certain drug and compromising the safety of the patients. 

However, a recent Johns Hopkins study debunked drug companies’ claims that higher profits lead drug companies to conduct more innovative research. The researchers based their study around the creation of Medicare Part D which went into effect in 2006 and expanded prescription access to 5 million seniors over the age of 65. As a result, pharmaceutical companies were given a chance to make more profit to sell to these newly eligible people. The researchers were looking to see if the new profits generated by the drug companies would lead to the innovation of “true novel therapies” aimed at their older patients, or if the profits would focus on creating copycat versions of existing drugs that already treat the elderly population. The findings showed that drug manufacturers overwhelmingly chose to fund copycat drugs. From 2012 to 2018, there was a 106 percent increase in the number of clinical trials for less-novel drugs targeting seniors, but only a 14 percent increase in trials for more novel pharmaceuticals (Dranove & Garthwaite). 

This study can be used to show that higher profit margins do not necessarily correlate with higher rates of breakthrough drug innovation. However, it can be noted that the copycat drugs produced did have fewer side effects than previous drugs on the market and increased market competition, which eventually led to some decreases in prices.


Ethics Concerning Responsibility

Our free-market economy is designed to allow companies to maximize profit under the constraints of consumer demand and competition. With the pharmaceutical industry, however, it is evident that consumer demand for many prescription drugs will never mitigate or decrease. Demand will always be there, which eliminates a constraint that many other industries face. Competition, for many pharmaceutical products, is also not much of a constraint either, as it has been drastically reduced with patent and market exclusivity policies. Therefore, a unique situation is created in the pharmaceutical industry that raises the question of whether drug companies should assume responsibility in pricing their pharmaceuticals to ensure widespread access. Or, to put it another way, that pharmaceutical companies should self-regulate their prices since there are currently few regulations or constraints calling on them to do so.

Beneficence

Pharmaceutical companies should take on this responsibility because of their obligation to be beneficent. Their work is tied to promoting public health and social good, which comes with added responsibility. Pharmaceutical companies are part of the healthcare system and are vital in helping physicians treat their patients, so they too should maintain the mindset of doing good for others. Though one purpose of pharmaceutical companies is to contribute to public health and save lives, it is evident that other goals, such as generating a return on investment and high profit margins, can compromise this aim. It is important for drug makers to balance business growth with the common good, and achieving this balance starts with changing the way they set drug prices. They must also be mindful of the value of their products to their consumers and recognize that high drug prices are not fair to consumers who need their medications but are unable to pay for it. Drug companies must stay aligned with the value of beneficence and use product value as a means to make them more accessible, not as a way to increase profits. 

To illustrate the importance of this responsibility, it must be recognized that the pricing of a drug can automatically affect who has access to it. As explained before, when drug prices are high, insurance companies have a harder time covering the cost, leading them to create methods to manage drug spending. These methods consequently make it harder for patients to obtain certain medications, leading to a decrease in prescription access.

CSR Pyramid

Archie Carroll’s Corporate Social Responsibility (CSR) pyramid is a widely used framework that delineates the expectations of businesses in society.

“Social responsibility is the obligation of decision-makers to take actions which protect and improve the welfare of society along with their own interests.”

-Archie B. Carroll

The goal of the pyramid is to provide a framework in which a business can find a balance between their societal and personal obligations. There are four levels to the pyramid: economic, legal, ethical, and philanthropic responsibilities. Economic and legal responsibilities lay the foundation of the pyramid because they are required by society, while ethical and philanthropic responsibilities are expectations for companies to maintain. Economic responsibilities lay the base for a company’s social responsibility because, for a business to build up to higher-attaining ethical and philanthropic pursuits, they must first have a strong economic base. Businesses are created to offer goods or services to the public, so the public allows businesses to generate profit in exchange for their added value to society. With drug manufacturers, the value they add is their prescription drugs, and patients are willing to pay for them because of their value. Businesses must also follow the legal requirements of society, which can also be described as “codified ethics”. Laws and regulations reflect a society’s firm expectations for businesses. If legal responsibilities are not met, then this could cause a business to dissolve. Ethical responsibilities expected by society take the legal requirements one step further. Businesses are expected to follow laws “in spirit” and not limit social obligations to the concrete letter of the law. This includes choosing to take actions that are aligned with the law when businesses step into territories that are not specifically covered by the law. To provide a real-world example, certain brand-name drug companies may enter “agreements” with generic brands to prevent generic copies of their drugs from entering the market and therefore eliminating competition. If viewed differently, this interaction could be labeled as collusion. This is an example of where companies find themselves in a grey area and choose to perform the action not aligned with the law, making the action unethical. In comparison to ethical responsibilities, philanthropic pursuits are not necessarily enforced by society but are still expected. Philanthropic responsibilities are voluntary, while the other three levels are arguably required for true business success. Businesses may seem altruistic when pursuing philanthropy, but in many cases, it is used to enhance their business model and reputation.

Carroll, Archie B., Source

The responsibility to price pharmaceuticals in a way that enables access falls in between the lines of ethical and philanthropic duties. In the United States, there is very minimal legal regulation on drug pricing, so there are virtually no legal responsibilities restraining the action of pricing pharmaceuticals. This is part of the reason why the ethics of pharmaceutical pricing is blurred since there is no legal, codified obligation to the public that is guiding pharmaceutical companies in their pricing decisions. Instead, there is a moral obligation to preserve the health of the public by ensuring widespread access to medications. This could be perceived as philanthropic because it requires drug companies to lower drug prices out of the “goodness of their hearts” since the only binding responsibility they have is to the wellbeing of society. Sometimes philanthropic obligations may seem frivolous, but in this situation, they should not be taken lightly. Many Americans struggle to pay for their medications. Many have seen the costs of pharmaceuticals and healthcare take a toll on their economic stability. If pharmaceutical companies cannot effectively price pharmaceuticals because of their moral obligation to public health, then there needs to be firm, legal constraints that will ensure their social responsibility.

Counterargument

Now, one may argue that a pharmaceutical company’s responsibility to serve the public good does not require them to be mindful of setting drug prices that ensure widespread patient access. It can be said that drug companies already do “good” by funding innovations that benefit humanity. Though this may be true, I believe that the future benefits provided by innovation in pharmaceutical technology are outweighed by the current situation of decreasing access. If the situation is left unchecked now, then how will it worsen in the future? Will drug prices keep rising, and will the issues concerning access magnify? 

It may also be argued that a manufacturer’s drug prices are highly influenced by other stakeholders, such as PBMs, wholesalers, and insurance programs. Therefore, drug companies do not have much influence over setting their prices, leaving the responsibility to these other stakeholders. If this is the case, should other stakeholders be held to the same standard of social responsibility as the pharmaceutical companies? Or should policymakers intervene, as was implied above, to create a legal obligation to society? The answer is unclear, as the United States has a highly complex healthcare system with many moving parts. Adjusting one aspect of the system will certainly affect another, so effectively regulating the system so that increased access to patients can be achieved will take trial and error. 

This solution may lead to a slippery slope: if pharmaceutical companies are held accountable for lowering their prices, should other companies that produce essential products be forced to lower their prices, too? Where do we draw the line between goods that are considered essential and nonessential, and how do we decide who is responsible for providing them to the public? These are all questions that need to be considered when criticizing stakeholders’ with the responsibility of drug pricing.


Possible Solutions to Regulate Drug Prices

After establishing that rising drug prices are a severe issue in the United States, and after considering the ethics of the situation, here are some ways in which we can address this pressing issue.

Value-based Pricing

Image by Steve Buissinne from Pixabay

One possible solution, which is currently quite experimental, involves the combined strategies of value-based pricing and outcome-based contracting, where a drug is paid for based on its effectiveness to a patient. Here is a real-life example of how this interaction has worked: In 2017, Harvard Pilgrim Health Care signed a value-based contract with pharmaceutical company AstraZeneca for two drug therapies that treat acute coronary disease and type 2 diabetes. The amount paid to the manufacturing company would depend on the effectiveness of the treatment. To measure the outcome, the number of return visits to the hospital after giving patients the treatment was recorded in comparison to patients who received a different drug. If it was concluded that AstraZeneca’s therapy resulted in a significant reduction of hospital visits, then the drug company was reimbursed (Hanna et al.). Better outcomes were linked with higher reimbursements, while the opposite case rendered low reimbursements. A limit with this concept is that there is not always enough data available to measure positive outcomes. It would also be difficult to measure the value of a drug for each patient since value can be categorized differently and varies by patient. However, with more trial and error, this could be a legitimate and widely used solution.

A National Price Negotiation

A more reliable and concrete solution would be to implement laws and regulations on a federal level. One influential regulation that can be established is a national price negotiation system, such as the ones that exist in the United Kingdom, Canada, Japan, and Australia. A national price negotiation system would be able to manage the prices of new drugs before they are listed on the market. Certain price requirements could also be required when drugs are seeking approval to enter the market. Also, like Japan, the therapeutic value of existing drugs could be weighed yearly to see if the price reflects the value of the drug to its patients.

Modifying Patent Terms

Another option could be to alter patent terms. This could potentially look like reducing patent durations, creating regulations that limit the number of patents given to a certain drug, or implementing ways to regulate drug prices while under a patent. As patents prevent generic and less expensive forms of drugs from being made, reducing patents will allow for generic and other brands to enter the market sooner and stimulate competition and price reductions. However, patents should not be restricted to the point that the value of a drug is not properly reflected through limited protection.

Increased Transparency

Another goal of policymakers could be to create laws that will increase the transparency between pharmaceutical companies and middlemen such as PBMs. Though this has already been attempted with some of the Trump administration’s rules, there have also been third parties who have been trying to implement these strategies. For example, a major company called GoodRx works to deliver price transparency to users by displaying the various prescription drug prices across the pharmaceutical market. They also work to provide discounts in addition to revealing where a consumer can receive the best prices for their prescriptions. It has been estimated that GoodRx has helped its customers achieve 20 billion dollars in savings since its inception in 2011 (Joseph).

 “A company like ours should not have to exist: People should be able to get the health care that they need, without having to do research and jump through hoops and get approvals”

-Dug Hirsch, co-CEO of GoodRx

Looking Into the Future

This issue of rising drug prices cannot be ignored. Too many Americans already struggle with medical expenses, and the issue of rising drug prices does not alleviate the financial burden on anyone. If prices are allowed to continue to rise, there will be a reduction of drug access and a simultaneous decrease in patient health. The public needs to address this crisis and drug prices need to be actively managed, whether through government regulation, internal pharmaceutical control, or both. If pharmaceutical prices keep rising, what will this mean for our economy? Will patients and insurers continue to bear the brunt of the costs? How will this affect patients financially, physically, and emotionally? The work for the future will be to help the pharmaceutical industry find a balance between profit, innovation, and patient access to the proper medications.


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