The true cost of drugs

Shadi Kourosh, MD, MPH, co-directed an expert panel discussing the high cost of drugs on the access for care with Bruce Brod, MD, chair of AAD's Task Force on Drug Pricing and Transparency.

Shadi Kourosh, MD, MPH, co-directed an expert panel discussing the high cost of drugs.

Patients are feeling the pinch from the rising cost of drugs and reduced insurance coverage, and dermatologists are left wondering how to advocate for these patients amid this new and uncertain landscape.

During “The Impact of Drug Pricing on Access to Care: Demystifying the Landscape” (U013), a health care policy professional, economist, and representative from the Food and Drug Administration shared their perspectives of how market, legislative, and national agency forces influence drug pricing and transparency.

The AAD established the Task Force on Drug Pricing and Transparency last year because patients are hurting, said Bruce Brod, MD, chair of the task force and clinical professor of dermatology at the University of Pennsylvania Health System, Philadelphia. He co-directed the session with Shadi Kourosh, MD, MPH, director of community health in the department of dermatology at Massachusetts General Hospital, Boston.

“It’s not just the cost of biologics. We understand they are high. It’s the cost of basic drugs. Our office staffs are burdened by prior authorizations and step therapy. It’s crippling us, in addition to all of the regulations we have to follow,” Dr. Brod said.

Panelists sharing their expertise were Rodney Whitlock, a health care policy professional with more than 20 years of experience with the U.S. Congress; Len M. Nichols, PhD, director of the Center for Health Policy Research and Ethics and a professor of health policy at George Mason University; and Jonathan Jarow, MD, acting director of the FDA’s Office of Medical Policy.

For Dr. Nichols, the Drug Price Competition and Patent Term Restoration Act of 1984, known as the Hatch-Waxman Act, cleared a path for generics so drugmakers don’t have to perform redundant clinical trials and can get to market faster. However, the balance between innovation and competition is off balance, he said.

“Eighty-five percent of small molecule markets now are generic,” said Dr. Nichols, of biologics, “which sounds great if you’re a generic customer, but not so great if you’re a producer of drugs, and they’ve started investing almost exclusively in biologics.”

Most of the increase in cost is from the innovator side, said Dr. Jarrow, adding that the FDA is seeing more breakthrough therapies.

“It may not be a bad thing that drug costs have gone up if these drugs have value by saving someone’s life or avoiding costly surgery,” said Dr. Jarrow, adding that roughly 1,300 molecular entities are on the market, and of those, 25 percent are protected
by patent or exclusivity from Hatch-Waxman.

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