Health Care Information and Better Communication: Transparency of Drug Pricing Data: Part 2

The price of health care treatment is a hot topic, both in America and Internationally. Seemingly innumerable news and web articles, Tweets, blogs, health care conferences, etc. are discussing the issue of rising medical costs, with well structured arguments both FOR and AGAINST these price increases. I’ve heard laudable comments and viewpoints of many reputable and intellectual voices, but most seem to limit themselves to clearly and thoroughly explaining the status quo. Commonly, when I observe someone propose a new idea or theoretical solution to one or several facets of the cost of health care dilemma, I can’t help noticing the plethora of critical opposition ready to pounce without first properly exploring said idea or solution.

Recently, TRANSPARENCY is a word one sees quite frequently, especially affiliated with health care costs and drug pricing. As many patients find the cost of their health care increasingly financially burdensome, they are demanding more information in order to a) better understand the high prices and b) determine if a more affordable option is available. Some information health care consumers are requesting include, but are not limited to diagnostic costs (what hospitals charge for a CT scan) and pricing data (such as Pharma R&D, company merger and marketing costs, among others, that influence pricing of a drug or medical device).

I’m particularly interested in exploring the idea of improving transparency, which is why I am posting this discussion. I’m asking any interested readers to explore this topic and comment however you wish. Maybe you are FOR transparency. Maybe you are AGAINST transparency. Or maybe you would simple like to provide a circular argument on which others can ruminate. Whatever your opinions are, please share them so that others may benefit from your knowledge.

Below are some factors (a few with supplemental questions) I view as having influence (direct or indirect) on drug pricing and the cost of health care (not necessarily all inclusive). Any comments pertaining to the topic of health care costs, drug pricing and TRANSPARENCY are welcome.

1. R&D costs relevant to the pricing of a new drug or medical device.

2. The cost of company mergers relevant to the pricing of a new drug or medical device (especially since this is a prevalent topic in current news).

3. The cost of competing drugs or medical devices.

4. The cost for insurance companies to cover aberrantly high-priced drugs or medical devices for certain treatments.

5. Duration of a drug’s patent protection upon entry into the market.

6. The impact that the First-Inventor-to-File (FITF) law has on potentially giving more leverage to companies that are more equipped to quickly reach filing stage.

7. The impact of an inevitable future generic drug on the pricing of a current brand drug (keep in mind the common complaint that generic birth control medications do not always act the same as their brand counterpart).

8. For aberrantly high-priced drugs or medical devices (such as Gilead's Hepatitis C drug, Sovaldi), what financial aid options could patients find until a cheaper generic drug enters the market? Will a given insurance company be expected to help in this regard (this is where my knowledge is most limited)? And if so, how might this high expense on insurance companies affect the overall health care system?

9. Regarding competition keeping prices in check, what happens if the rate of innovation falls and companies start consolidating to balance a lack in new, in-house quality-of-health sustaining drugs that would reap big financial rewards (especially since shareholders are always demanding greater returns)? And might competition be further stifled due to the FITF law?

Although I previously posted this discussion on LinkedIn (see Transparency of Drug Pricing Data: Part 1), no one has yet attempted to directly address the complex and multi-faceted topic outlined above. If you would like some background information before commenting, below you will find several links to relevant articles.

Rise and Fall of the American Medical Empire - by Robert A. Linden
Bad Pharma - by Ben Goldacre
America's Broken Health Care System: The Role of Drug, Device Manufacturers

http://ow.ly/xFyK5

Why does Gilead's Sovaldi cost $84K in the U.S. and $57K in Britain?

http://ow.ly/xFBeM

Why do Hospitals Charge $4,423 for $250 CT Scans? Blame Arizona Republicans

http://ow.ly/xFBq8

First Million-Dollar Drug Near After Prices Double on Dozens of Treatments

http://ow.ly/xFBuL

Can You Afford Your Medicine? Doctors Don’t Ask

http://ow.ly/xFBEV

Hatch-Waxman Act 1984 (Drug Price Competition & Patent Term Restoration)

http://ow.ly/xFCnK