It is no secret that pharmaceutical companies are being blamed left, right and center for rising healthcare costs. A series of high-profile cases, including Turing Pharmaceuticals’ 5,000% price increase of its Toxoplasmosis drug, Daraprim, and Mylan’s 400% price increase of its EpiPen, have hampered Big Pharma’s image with patients and have allowed the government to lament industry for so-called price-gouging.
However, a recent article, published by FiercePharma, argues that, although pharmaceutical costs are high, they are nothing compared to hospital and physician expenses. If you look at the statistics from last year (2016), the US spent $1.1 trillion in hospital charges and $683 billion in physician and clinical expenditures. If you compare this to the $348 billion that was spent on prescription drugs, it is easy to see that the prices set by pharmaceutical companies are not solely to blame for rising healthcare costs.
And, although the article does not suggest that drug companies are blameless, it does imply that effective drug therapies could actually save the country money in the long run. Every time a new drug comes to market, there are patients somewhere in the US that are likely to see improvements in their health. These improvements will most likely lead to fewer hospitalizations and a decreased need for expensive hospital procedures like transplants.
For example, Gilead Sciences claims that the high price tags on its hepatitis C drugs are justified given the higher cost of hospitalizations for liver disease and the even higher expense of treating liver cancer and delivering liver transplants.
Furthermore, because of the way health insurance plans are designed in the US, patients have more exposure to drug prices than they do to hospital fees, and so find it easier to blame the pharmaceutical industry when they experience an increase in their healthcare costs.
To find out more, click here to access the original article.