On July 7, Gov. Gavin Newsom announced that California will start making insulin to fight expensive prescription drug prices (@CAgovernor/Twitter). This could make the vital drug more affordable to millions who require it daily and currently face monthly costs between $300 and $500 and sometimes as high as $1,000 (Kaiser Family Foundation, Yale News). From insulin to EpiPens, expensive and inaccessible prescription drugs are a reality of a failing healthcare system.
“Nothing epitomizes market failures more than the cost of insulin,” Gov. Newsom said. “Many Americans experience out-of-pocket costs anywhere from $300 to $500 per month for this lifesaving drug. California is now taking matters into our own hands.”
Prescription drug prices in the U.S. can be hundreds of dollars with insurance, preventing many people from accessing necessary, even lifesaving, medicine. On average, people in the U.S. spend around $1,200 a year on prescriptions, which is more than other western countries like Canada ($868), France ($726), and the U.K. ($590) (OECD). The same drug can cost as much as 67 times more in the U.S. (House Ways and Means Committee).
Unaffordable medication causes some to make unsafe decisions like bypassing treatment or not taking medicine as prescribed to delay a refill. In 2019, 7% of U.S. adults reported being unable to pay for a prescription, while 10% skipped or rationed doses to save medicine and money (Gallup). Those numbers were twice as high among lower-income households.
Costly drug prices have a devastating effect, especially on the financially insecure. About 34 million people knew at least one friend or family member who died in the last five years after not receiving necessary medical treatment because they could not pay for it (Gallup). This was highest amongst people of color, with 20% saying they knew someone who passed due to the inability to afford or access medicine, compared to 10% of white people. More than 100 million people in the U.S. struggle with some form of healthcare debt that they cannot pay off or prevent them from receiving additional care (NPR).
In the U.S., pharmaceutical companies set their own prices for patented drugs with little pushback because the FDA protects “drug innovation” from competition for 20 years. And if they continuously make minor tweaks to the drug, drug companies can extend their patent, effectively barring more cheaper, generic versions from hitting the market (CNN). They can also raise drug prices annually without significant changes to the drug— and no relief for consumers (WTHR, Health Affairs, CommonWealth Fund).
“The drugs are the same drugs as last year, the same drugs as ten years ago, yet they are more expensive, and we know drug prices are higher over time not always because of innovation,” Dr. Inmaculada Hernandez, associate director at the University of Pittsburgh’s Center for Pharmaceutical Policy and Prescribing, said. “The fact that a drug is 10% higher in cost or in price than last year, it doesn’t mean it’s 10% more effective. It just means that because payers are willing to pay for them, that [the drug makers] keep increasing the price.”
Government officials have tried to combat rising drug costs from the pharmaceutical industry, advancing a deal that would allow the federal government to negotiate lower prices on prescription drugs for Medicare (Reuters). However, it’s primarily fallen on consumers to shop around and find solutions to costly prescription drugs or opt-out altogether, especially if uninsured.
This year, billionaire entrepreneur Mark Cuban unveiled his online pharmacy, Cost Plus Drug, which provides low-cost generic drugs. By skipping the middleman, people can buy directly from manufacturers, which allows for sizable discounts on prescription drug prices (USA Today). For example, Imatinib, a leukemia treatment that costs $9,657 per month, will run $47 per month there. Other companies like Blink Health, GoodRx, SingleCare, and WellRx make prescription drugs more affordable, especially for insured people.
Lifesaving prescription drugs and healthcare being too expensive and unaffordable to a large population of the U.S. is a problem that will continue to take lives and leave millions in debt unless those in power prioritize people over profits and advocate for drug price reform.
• Prescription drug prices in the United States are the highest among most nations, especially Western countries.
• Even with insurance, prescriptions can cost hundreds of dollars.
• Medication insecurity in the U.S. can have deadly consequences when a person cannot access necessary medicines.