A Different Drug War

A recent post at Daily Kos considered a different and less recognized “drug war.”

Let’s talk about the other drug war: The one being waged against the American consumer by the pharmaceutical companies who benefit from our tax dollars that fund basic scientific research and make up the difference in the tax relief they receive for their own research and development.

The post was prompted by the recent steep increase in the price of the Epi-Pen. Among other disclosures, it turns out that the company that manufactures the pen had moved its headquarters to the Netherlands in 2014, a move that allowed its tax rate to fall from 14 percent to its current 7 percent.

The fact that the company and its well-connected management are making out like bandits by stiffing those who need the devices is bad enough, but as the post points out, it isn’t even recovering its own costs of research and development.

The mechanical device in the EpiPen to deliver epinephrine was developed in the 1970s by a NASA engineer. It was designed for the rapid self-injection of antidotes to chemical warfare agents in battle, and in 1987 it was approved by the FDA for use with epinephrine. Epinephrine itself is a human hormone, first isolated by Japanese scientists in 1901. So the drug couldn’t be patented, although the device itself, the same one created by a government employee, was. The logical assumption, of course, is that a technology developed by a NASA engineer would be owned by all Americans. But it is not.

This is an excellent example of the Achilles heel of arguments advanced by drug companies defending exorbitant prices.

Big Pharma makes the case–correct as far as it goes–that the development of new therapies is expensive. Many promising avenues of research fail to pan out; testing and the regulatory process for vetting drugs is expensive and time consuming. If companies are to continue to sink money into the development of life-saving drugs, they need a financial incentive to do so–a promise that they will recoup their costs and make a reasonable profit.

What they don’t mention is that significant percentages of drug development costs are paid for by government grants–by the many millions of taxpayer dollars that support medical research. (They also don’t mention that, by some calculations, Big Pharma spends more on those interminable television ads than on research. Purple pill, anyone?)

It is especially galling that American consumers are charged more for drugs developed with substantial taxpayer support than consumers of those same drugs in other countries. It would be one thing if our tax dollars subsidized the cost of medications across the board, but it is really unconscionable that the same people whose taxes helped pay for the development of medications are also being charged more for those medications.

Lobbyists for the drug companies have managed to get laws passed that prohibit U.S. government agencies from negotiating drug prices as other countries do. At a bare minimum, those laws need to be repealed.


  1. ” At a bare minimum, those laws need to be repealed.”

    Exactly. That’s what really pissed me off when Palin was propagating her disingenuous “death panel” shtick. We have death panels; they’re the executives of the insurance and pharmaceutical companies. Their enablers within congress should’ve been sent packing. Unfortunately when sent packing,they summarily start lobbying for such industries. This enabling was a bipartisanship effort. I just read a recent article where an acne cream now sells for $10,000 a tube. Something is very wrong, and why in the hell those responsible for keeping the industries in check have not been held accountable pisses me off to no end. Plus,it’s another reason why I just cannot vote for those that have accepted large donations from Big Pharma and have enabled such pillaging to continue.

  2. Do you suppose Lester Holt will ask Hairball and Hill to debate (cough, cough) this issue. Maybe Jill and Gary will tomorrow night.

  3. It may be time to revisit Bayh/Dole, making it clear that patents obtained on Government funded research cannot be abused by price gouging. If a company has such a patent and is found to be overcharging, they ought to lose the patent rights.

  4. A repeat personal view of this blog; Eskenazi Hospital let my daughter lay near death 4 or 5 times before finding someone to cover her share of Hepatitis C medication (Harvoni) which is virtually a miracle drug. Her cost would have been $700 PER PILL of the total cost $1,152.58 PER PILL; $1,130.58 in Canada PER PILL.

    Terbutaline was approved to treat asthma in humans and as birth control in DOGS but someone in the medical field started the trend of prescribing it for pregnant women to prevent premature labor. They learned rather early on that Terbutaline caused heart problems in the mothers but ignored researching damage done to the fetus which causes disabilities similar to autism and Asperger’s Syndrome and others and at times a combination of disabilities. My 17 year old grandson is one victim; born in 1999, Ginny F posted recently on this blog that as a law student she researched a case involving a three-year old in 1987 or 1988. So; medical researchers have known for more than than 30 years but has ignored until recently researching these known disabilities and their cause.

    Have you ever watched someone who requires the EpiPen struggling to survive during an attack? Their eyes are filled with terror because they cannot breathe; these victims are all ages from small children to the elderly. Pharmaceutical companies are sucking up our tax dollars as many die or suffer life-long disabilities due to their greed. Health care coverage, if it provides prescription assistance, is a small percentage of the cost. There is no “sliding-scale” cost for life-saving medication…shouldn’t there be?

  5. JoAnn,

    As a person who has suffered from asthma since my teenage years – here is an example of how emotions from past experiences can impact breathing: When I read the sentence below copied from your post, my lungs started tightening up because I have been in that suffocating situation many times myself.

    “Their eyes are filled with terror because they cannot breathe;”

  6. Big Pharma isn’t just scamming drug prices…how about their obstruction on government shifting policies toward prevention, in general?

    How much could our government save by implementing policies requiring specific BMI requirements for all Medicaid or Medicare recipients?

    Also, our water is tainted with pharmaceuticals. Wastewater treatment can’t remove pharmaceuticals from our drinking water. Also, the chemicals running off into the water we drink is causing increased levels of estrogen. In PA, they are finding fish and frogs with both sex organs. My endocrinologist told me that one-third of new diabetic men have low testosterone.

    Obamacare was a gift to Big Pharma. Both parties are owned by Big Pharma.

    Also, we’ve learned that both parties are complicit with corporate media who reaps huge profits from advertisements by Big Pharma.

    It’s a racket, and we’re only seeing the worst abuses – the tip of the iceberg!

  7. Nancy; I am so very sorry you suffer with this terrible illness. I was with a friend who had a severe asthma attack once, only once showed me what I had simply been told about. She had such a tight grip on my hand, the EMTs had trouble getting me loose so they could put her in the ambulance. I never knew, and neither did she, if it was pure strength in that grip or if her body was fighting so hard that her hand clamped down with a muscle spasm. I just signed another petition demanding the cost of EpiPens be lowered to reasonable cost.

  8. Pharmaceutical companies who seek overseas “home office” protection ordinarily do so for tax purposes, so when they are funded for basic research by us taxpayer/consumers, then reduce their corporate taxes by 50% by moving to Holland, then reduce their tax exposure by the remaining deductible costs for R & D, then charge us more than overseas consumers (who are protected by their politicians from ripoffs), it is clear that we are funding the costs for overseas consumers while getting ripped off in every conceivable fashion by such pharmaceutical firms who are in business to make money at (literally) the cost of human lives as well. It was the Bush administration that provided the statutory background”no dickering” on prices of drugs, and with a stop to purchasing drugs from Canada and overseas generally, it is clear that the pharmaceutical companies wrote such legislation and had it run through the statutory gauntlet by its lackeys to the great expense and danger to life and limb among American taxpayers/consumers. This act can be repealed. The argument that competition will make the economy hum is a joke when one’s representatives in the Congress remove it with their “free market economy” pretense. It appears that exemption from anti-trust acts (in return for campaign contributions and credits to Swiss and Cayman accounts and promises of post-government service employment) has become just another goody that can be bought by special interests on the legislative marketplace, and this at a time when median wages are declining for the rest of us, a sure recipe for increases in the ranks of the poverty-stricken and one more step toward ultimate lack of social cohesion.

  9. Big pharma spends substantially more on advertising than on R&D. The purpose of their advertising? To subvert any attempts to manage health care costs.

    They are selling to patients to get around having to sell to medical professionals who have been recruited to solve one of America’s largest problems; making the same health care available to everyone rather than just the aristocracy.

  10. RE: the EpiPen saga

    The EpiPen saga continues as we look beneath the surface and find what some would call a web of influence that likely should not exist. The story is complicated so it’s a good idea to familiarize yourself with the key players before reading the linked article. By the way, there’s a brief overview video worth viewing.

    Mylan — the Big Pharma company that markets EpiPen
    Mylan CEO — Heather Bresch, nee Manchin
    Heather Bresch — daughter of Joe Manchin, Senator Joe Manchin, West Virginia
    Gayle Manchin — Senator Manchin’s wife, Heather Bresch’s mother, and also President of the West Virginia State Board of Education and former president of the National Assn of State Boards of Education (NASBE) president and emeritus board member.


  11. Side issue: “Obamacare” (I just love it that they named it after him, derisively, thus making him a saint in the minds of millions like me). You can blame Obamacare for its many failings, and supporting this wicked system of drug profiteering is indeed one of them, however, I live because of it. I am self-employed. I have been diagnosed with one of those pre-existing conditions. The treatment includes a ridiculously expensive weekly dosage of medication. Surely I would be without insurance and treatment without Obamacare. Instead my fairly decent and fairly affordable MDWise insurance plan makes the drug I need, if not affordable, feasible. That does not change the point of this blog, but to those who lump the ACA in with all the profiteers, please remember that it was the best we could get at the time, and it is literally saving and improving thousands if not millions of lives every year and is funded by (gasp) taxes on those who can afford to pay. Who ever thought my hero would be some guy named Hussein?

  12. Gerald E. Stinson –

    Your post covers it all so very well. Thank you also for mentioning that GW Bush signed the law that protects pharma companies from price negotiation and then also outlawed U.S. citizens from buying drugs from Canada. I clearly recall when he did that. It was a huge handout to Big pharma.

    While Indiana citizens benefit from the Lilly Foundation, I consider every gift they make (and get credit for) as one that has basically been force-funded by people who have had to purchase their meds but had no say in what lovely gifts they were paying for to benefit others.

  13. I stopped buying certain prescription drugs, because even with the co-pay, I can’t afford them. It’s very hard to keep up even now….groceries or prescriptions?????

  14. Is there any cure for this out of control wealth redistribution from everyone to the select few but fully socialized medicine?

    I personally don’t see it but would love it if someone could come up with another alternative.

  15. Over it,

    That is exactly why I am a fan of the ACA too. Allowing insurance companies to refuse to insure people with pre-existing conditions or, at the very least, insuring them for anything but their pre-existing condition is inhuman and the Republicans in congress would like to return to that system of not insuring people who most need it.

    My hope is that as the insurance companies become more greedy and there will be so many people who cannot afford insurance that they will rise up and demand single payer insurance or Medicare for all. As deductibles and copays rise there are now far too many insured people who cannot afford to use the insurance they have. They end up going without care so what is the point? I understand that the ACA forced insurance companies to cover certain well visits, but it just isn’t enough. Going without necessary care or meds or surgeries eventually catches up with you. Been there, done that.

  16. We already have socialized medicine, but for the few who have invested in our health as a business. Truth is, health is not a matter of insurance at all. It is rather to be defined on the order of food stamps, and (so far) we haven’t privatized eating.

  17. What war is the drug war at all, other than hot air measurements since 1942? No one can fight in words at all. Individuals make a lot of money at Indianapolis from prehistoric to present plants and animals used experimentally, including Humans as individuals in this nation-state — about 2/3 of whom use prescriptions that are occupation-related and 1/3 who make and disseminate those for wealth.

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