Sky-high drug prices are a problem for Americans across the country, especially those dependent on insulin. Lawmakers are reaching across the aisle to help bring affordable prescription drug prices to consumers, but they’re up against a powerful force that’s fighting to keep prices inflated: big pharma.
What is big pharma?
Big pharma is the colloquial term for the pharmaceutical industry at large. However, it’s also used to represent one specific lobbying group working in the pharmaceutical industry–the Pharmaceutical Research and Manufacturers of America, or PhRMA.
PhRMA represents the nation’s largest drug companies, like Pfizer, Sanofi, Merck, Johnson & Johnson, and more recently, Gilead Sciences. PhRMA works on behalf of these drug companies by encouraging politicians to vote in a way that keeps drug prices (and profits) high. This is called lobbying.
What is lobbying?
In short, lobbying is the act of trying to persuade the government to make decisions that work in your favor. Lobbying can be done by one person or by a group of people. These people are called lobbyists, and are often hired by large companies to do their bidding for them.
Many of the nation’s largest drug companies hire lobbyists to oppose bills that would bring drug prices down.
How does big pharma keep drug prices high?
In 2015, Martin Shkreli was dubbed “the most hated man in America” for increasing the price of the life-saving drug, Daraprim, by more than 5,000 percent overnight. Congressional leaders like Senator Bernie Sanders (I-VT) and Rep. Elijah Cummings (D-MD) launched investigations into the drug pricing scandal immediately.
As CEO of Turing Pharmaceuticals, Shkreli did what most drug companies do when facing regulations and restrictions: he hired a lobbyist. Lobbyist group Buchanan, Ingersoll & Rooney PC then acted as middlemen between Turing Pharmaceuticals and Congressional leaders, effectively slowing down the investigation.
In anticipation of more lawmakers pushing bills to regulate drug prices, PhRMA increased their dues by 50 percent in 2016 in order to raise an additional $100 million for their fight to keep drug prices high.
In other words, when drug prices are high, the winners are drug companies, big pharma lobbying groups, and pharmacy benefit managers. The losers are always the consumers who pay more out of pocket.
What has big pharma lobbied for recently?
In 2009, PhRMA spent over $25 million to fight the Affordable Care Act.
PhRMA reported spending a record-breaking $27.5 million on lobbying efforts in 2018. However, OpenSecrets, a nonpartisan, independent research group that tracks money in Washington, D.C., found that to be false. OpenSecrets reported that the number was $194.3 million higher than what PhRMA reported as of October 2018.
This record-breaking number indicates a sign of increasing threats to big pharma as lawmakers across the country fight to bring affordable drugs to the American people.
If you’re tired of paying too much for your prescription drugs, call your Congressional leaders and ask them to stop working with big pharma.
With drug prices skyrocketing due to big pharma, insulin is no exception. Due to out-of-control insulin prices, Medicare spending on insulin grew 840 percent between 2007 and 2017, the rate of which far outpaces the number of Medicare beneficiaries who rely on this life-sustaining diabetes medication.
According to recent statistics released from the Kaiser Family Foundation, Medicare is spending exorbitant amounts of money on insulin to keep its diabetic beneficiaries healthy. While Medicare saw an 86 percent jump in the number of beneficiaries who use insulin between 2007 and 2017, the jump in price is still far greater than the increase of people who need the drug.
As you can see in the following chart, average insulin prices in America far surpass those in other countries throughout the world.