Tagged Prescription Drugs

Advances In Treating Hep C Lead To New Option For Transplant Patients

After her kidneys failed from the same illness that took the lives of her mother and brother, Anne Rupp went on dialysis in May 2016, spending three hours a day, three times a week undergoing the blood-cleaning procedure. She hated it.

Rupp, who had polycystic kidney disease, joined more than 95,000 other Americans on kidney transplant lists. She knew the wait could stretch out for years.

But an experimental — and controversial — source of donated organs provided a far quicker resolution: Expensive medicines to treat hepatitis C have made it possible to use organs donated by victims of opioid overdoses who were infected with the once-deadly virus.

Six months after agreeing to be in a study in which patients in need of a kidney transplant would accept infected donor organs, Rupp got a 7:30 a.m. call at her home in York, Pa. “We have a kidney for you!”

The number of people donating organs after dying from drug overdoses has risen more than 200 percent since 2012, data from the United Network for Organ Sharing (UNOS) show — more than 13 percent of donors overall. About 30 percent of the 1,382 overdose-death donors in 2017, however, tested positive for hepatitis C.

In the past, organs exposed to hep C were typically discarded or given only to patients who already had the illness. Using them in patients who don’t have the virus could shorten the transplant wait time for hundreds of patients each year.

“This is super exciting because five years ago 100 percent of [the donated] hep C hearts were being buried and now some are being used,” said Dr. Peter Reese, an associate professor at University of Pennsylvania. “The world has changed.”

But patients who receive such organs would almost certainly need simultaneous treatment with drugs to treat hepatitis C, generally a six- to 12-week course of drugs that costs tens of thousands of dollars. And it’s unknown whether long-term use of the drugs is safe and effective in this population.

“‘We haven’t done this before,’” Rupp, 76, remembers her doctor at Johns Hopkins Hospital in Baltimore telling her when he offered her the option. But, he explained, the new antiviral medications nearly always cure hepatitis C.

While some hep C patients have no symptoms, over time, the untreated virus can cause chronic liver disease and lead to liver failure.

The Hopkins study — and several others nationally — are opening up new medical possibilities, while exposing patients to potential costs.

Since the procedure is considered experimental, many health plans don’t have a specific coverage policy on the expensive antiviral drugs that go hand in hand with it.

Insurers that responded to questions for this story generally said they take each request on a case-by-case basis, and cover the drugs if they deem them medically necessary.

Researchers and ethics experts say coverage must be clarified before the new procedure becomes more widely available.

“How can you intentionally infect someone if not 100 percent sure their third-party payer will pay for [treatment] it?” said Dr. Christine Durand, an assistant professor of medicine at Johns Hopkins University School of Medicine.

At Hopkins, patients start the antiviral drugs just before being wheeled into the operating room. Other programs wait until the patient tests positive for hepatitis C, usually in the first few days after a transplant. Generally, when part of a study, the drugs are paid for by the manufacturer or the institutions conducting the research.

When the drugs first hit the market at the end of 2013, a course of treatment cost $100,000. As more antivirals have become available, prices have fallen and coverage limits have eased for people with chronic hepatitis C. The average net price for a round of hep C antiviral therapy is now $25,167, according to SSR Health, part of SSR LLC, a boutique investment research firm.

Outside of those trials, transplant surgeons say they’ve sought — and often obtained — insurance coverage for the drugs. Durand said the move is cost-effective because the drugs cost less than ongoing dialysis for kidney failure or mechanical heart assist devices.

Researchers are split on whether there’s enough evidence to take the procedure out of the realm of scientific study.

“It isn’t the standard of care today, but it’s going in that direction,” said Durand.

Others advise caution until long-term results can be seen.

While the first 20 patients at Hopkins and Penn who received kidneys in a published study were all cured of hep C, “if we had 100 patients, or 200, then we would get a better sense as to whether the cure rate is 100 percent,” said Penn’s Reese.

The heart transplant program at Vanderbilt University Medical Center in Nashville has transplanted 42 non-infected patients with hearts exposed to hep C, and continues to follow them. Dr. Ashish Shah, the program’s director, noted that some people with untreated or long-term hepatitis C have a higher incidence of coronary artery disease.

“We’ll have to watch that,” he said, but noted that many patients with severe heart failure would otherwise die waiting for a transplant. “It’s reasonable to think that risks [of accepting an organ from a hepatitis-infected donor] are far lower.”

Jay Fuentes, a 45-year-old registered nurse in Quakertown, Pa., agreed to participate in the study at Penn in hopes of getting a transplant more quickly after his kidneys failed in 2017.

“It seemed like a no-brainer to me,” said Fuentes. “If I was in the first group where it had never been tried before, I might have hesitated.”

He tested positive for hepatitis C shortly after the surgery and took the antiviral drugs for 90 days. He said he no longer tests positive and has gotten back into performing in local theater with his children.

“I have a whole new lease on life,” said Fuentes.

Must-Reads Of The Week From Brianna Labuskes

The next time I even hint that we’re drifting into a slow news period, feel free to remind me not to jinx things: This week was bursting with industry moves, health law attacks, midterm strategizing, and, oh yeah — an indictment.

A quick programming note before we dive into all that: The Breeze is going on hiatus as I breeze out of town for a bit. But I’ll be back Aug. 31, just as we really start heading into midterm season, so look for me again then.

Now for the news you may have missed:

This week’s swipe at the health law focused on accountable care organizations (shorthand explanation: a program that took a carrot-and-stick approach to getting hospitals, doctors and other providers to coordinate, with the end result of higher-quality, more efficient care). They were supposed to save the government billions of dollars, but data show they’ve failed to measure up to the promise, so the program is being overhauled.

The Washington Post: Trump Administration Proposes Further Dismantling of Affordable Care Act Through Medicare

Rep. Chris Collins (R-N.Y.) was charged with fraud in connection to alleged insider trading after an investigation into his ties with Innate Immunotherapeutics, an Australian biotech firm.

Politico: GOP Rep. Chris Collins Charged With Securities Fraud

If that all sounded vaguely familiar, it’s because back when then-HHS secretary nominee Tom Price was being vetted for any possible ethics violations, his connection to both Innate and Collins was put in the spotlight. And just a small plug: KHN did deep reporting on this, and you can read the stories here.

Medicare Advantage got some leverage to curb drug costs this week by way of “step therapy” (or, as it’s known to critics, “fail first”). Essentially, the private plans will be able to require that patients try cheaper versions of drugs before moving on to more expensive ones. To be clear: This is a pretty distant cry from campaign promises to let Medicare negotiate drug prices, and there’s no guarantee patients will actually see any savings from this move.

Stat: Private Medicare Plans Will Be Able to Use a New Tool to Lower Drug Costs

Would a Netflix model work for drugs? That’s what Louisiana wants to find out. Under the proposal, the state would pay a subscription-type fee to be able to cover all of its Medicaid patients who need hepatitis C treatment. Beyond the click-baity notion, though, experts warn that because drug prices are such a moving target (with some costs coming down quickly) the state may not actually save money.

Stat: Louisiana Explores a ‘Netflix’ Subscription Model for Buying Hepatitis C Drugs

For even some moderate Democrats, “Medicare-for-all” is a pipe dream involving all sorts of politically unpopular complications like trillions of dollars in government spending (the current point of contention). But on the trail, it’s a rallying cry. Gubernatorial candidates, especially, are embracing it, suggesting their states become early testing grounds for universal coverage plans that have been more rhetoric than action so far.

The Washington Post: Tossing Aside Skepticism, Democratic Candidates for Governor Push for State-Based Universal Health Care

The Hill: Ocasio-Cortez: ‘Medicare for All’ Is ‘Not a Pipe Dream’

Apart from “Medicare-for-all,” Democrats could have a winning health issue with drug prices. The problem? They can’t really coalesce behind a plan, all these “concessions” as of late are making it harder to attack the administration, and, uh, there may be a lack of interest in cutting off campaign cash this close to the elections.

Stat: Drug Prices Could Be a Winning Issue for Democrats — If Only They Had a Plan

The idea to penalize legal immigrants’ use of Medicaid has been rumbling around for a bit now, but it picked up some speed in recent days. Though it could be a winning issue for Republicans on the trail, the argument isn’t really backed up by the data. It turns out that legal immigrants are likely subsidizing native-born Americans’ health care.

The New York Times: Plan to Punish Immigrants for Using Welfare Could Boost G.O.P. Candidates

The Hill: Study: Immigrants Have Lower Health-Care Costs Than People Born in US

Buckle up, there were industry moves galore this week. I’ll try to keep it quick:  Billionaire Carl Icahn came out against Cigna’s attempts to acquire Express Scripts, saying it is (in my favorite vocab usage of the week) a “$60 billion folly”;  Rite Aid called off its (unpopular) merger with Albertsons; the American Medical Association came out against CVS’ deal with Aetna; and GM signed an exclusive deal with a health system to provide care for its workers.

The Wall Street Journal: Carl Icahn Publicly Opposes $54 Billion Cigna-Express Scripts Deal

The Wall Street Journal: Rite Aid, Albertsons Call Off Merger Amid Investor Opposition

Reuters: American Medical Association Opposes Merger of CVS and Aetna

The Wall Street Journal: GM Cuts Different Type of Health-Care Deal

If that wasn’t enough news for you, here’s my miscellaneous file: A billionaire and his PTSD clinics have become entangled in the fierce debate over VA privatization; a look at how Zika babies are faring as they grow up is sobering in the breadth of damage the virus has done; an app can warn those recovering from addiction when they’re in neighborhoods or with acquaintances that could trigger a relapse; and a medical examiner is writing to doctors personally each time one of their patients dies from an overdose — and it’s working.

ProPublica: Steve Cohen Is Spending Millions to Help Veterans. Why Are People Angry?

The Washington Post: 1 In 7 Babies Exposed to Zika in U.S. Territories Have Birth Defects, Nervous System Problems

Stat: Can An App’s Warnings to Avoid Triggers Prevent Opioid Addiction Relapses?

Los Angeles Times: Coroner Sent Letters to Doctors Whose Patients Died of Opioid Overdoses. Doctors’ Habits Quickly Changed

 —

And don’t miss one of my favorite long reads of the week (which I got sucked into while on deadline, thank you very much) about an Appalachian odyssey and a hunt for ALS genes.

Stat: Appalachian Odyssey: Hunting for ALS Genes Along a Sprawling Family Tree

Have a great weekend, all!

Trump Administration Sinks Teeth Into Paring Down Drug Prices, On 5 Key Points

Three months after President Donald Trump announced his blueprint to bring down drug prices, administration officials have begun putting some teeth behind the rhetoric.

Many details have yet to be announced. But experts who pay close attention to federal drug policy and Medicare rules say the administration is preparing to incrementally roll out a multipronged plan that tasks the Centers for Medicare & Medicaid Services (CMS) and the Food and Drug Administration with promoting competition, attacking the complicated drug rebate system and introducing tactics to lower what the government pays for drugs.

Mark McClellan, director of the Duke-Margolis Center for Health Policy in Durham, N.C., and a former CMS administrator, said that although none of the initial steps has “fundamentally transformed drug prices,” there is “a lot going on inside the administration.”

Two HHS officials who are rolling out the plan, Dan Best and John O’Brien, described their efforts to Kaiser Health News not as a public relations strategy but a push to reform the system.

“This administration is trying to go after root causes” of high drug prices, said Wells Fargo analyst David Maris.

But others are not so optimistic.

Ameet Sarpatwari, an instructor in medicine at Harvard Medical School in Boston, said policies the administration has rolled out thus far “alone will not translate into meaningful cost savings for most Americans.”

Broadly, the strategy falls under a handful of steps:

1. Attacking The Rebates

Health and Human Services Secretary Alex Azar has said Americans “do not have a real market for prescription drugs” because drug middlemen and insurers get a wide range of hidden rebates from drugmakers, but those savings may not be passed on to consumers or Medicare. In July, the administration submitted a proposed rule that could change the way rebates are handled.

Details of the proposal have not been made public. But O’Brien, a deputy assistant secretary at HHS, explained during a recent conference on federal drug spending sponsored by the Pew Charitable Trust: “You don’t have to use market power to get rebates, you can use market power to obtain discounts, to actually lower the price of the drug on the front end.”

Umer Raffat, an investment analyst with EverCore ISI, said “it’s not clear [that drug prices are going down]” but the “rebate structure is changing.”

2. Bringing More Negotiation To Medicare

This week, CMS Administrator Seema Verma announced that Medicare Advantage insurers can use a step-therapy approach to negotiate better prices for Part B drugs — those administered in hospitals and doctors’ offices. These private plans will be allowed to require patients to first select the least expensive drug before stepping up to more costly drugs if the original medications aren’t working.

The administration is also looking at ways to introduce more competition into Part B drug purchasing. That idea was mentioned deep inside the annual Medicare outpatient payment rule released last month.

Peter Bach, director of Memorial Sloan Kettering’s Center for Health Policy and Outcomes in New York, pointed to the possible introduction of a competitive purchasing program in which a firm negotiates with drugmakers to buy their drugs and then sells them to the doctors and hospitals that will administer the medications. Bach said that helps ensure that hospitals and doctors can’t make more money by prescribing more expensive drugs.

Currently, Medicare pays the average sales price plus 6 percent to doctors or hospitals when they purchase drugs, a pricing mechanism that can benefit the providers if the drug costs go up. If there were a third party buying the drugs, it would “have a huge effect,” Bach said.

3. Paying For Value

Trump’s blueprint calls for CMS to encourage “value-based care” to lower drug prices, shifting from paying a set fee for drugs to basing payments on how well the patient does on them.

Louisiana’s Medicaid program could show the way. The state is working with CMS to explore a subscription-based model to pay for hepatitis C medicines. Louisiana would pay a fixed price to a drug manufacturer that would then get unlimited access to treat patients enrolled in Louisiana’s Medicaid program or in prison.

The program would move “from a big payment upfront to paying less over time based on actual outcomes,” said McClellan, who also serves on the boards of health care giant Johnson & Johnson and insurer Cigna.

CMS also approved a Medicaid waiver from Oklahoma in June. Medicaid programs are allowed to negotiate drug prices. Oklahoma’s plan would expand that to negotiate additional prescription price reductions based on value-based purchasing agreements.

Still, CMS’ recent rejection of a related Massachusetts proposal makes it difficult to believe negotiating drug prices will really happen, said Sara Rosenbaum, a professor of health law and policy at George Washington University.

That proposal would have allowed Massachusetts’ Medicaid program to choose drugs based on cost and how well the medicines work.

“They have been very good and quite careful with their [Medicaid] program and so why not let them try this?” Rosenbaum said.

4. Tackling Foreign Drug Costs

Pharmaceutical makers often sell their drugs at substantially lower prices in many foreign countries than they do in the United States. Trump emphasized in May that “it’s time to end the global freeloading once and for all,” saying U.S. consumers were paying part of the cost of the medicines that patients in other countries use.

He directed U.S. Trade Representative Robert Lighthizer to address the situation. Lighthizer’s office declined to comment.

When Sen. Todd Young (R-Ind.) asked during a Senate health committee hearing in June whether trade agreements with other countries should be used to “level the playing field,” Azar’s response was swift: “We absolutely believe we should be using our trade agreements to get them to pay more even as we have our job to pay less.”

Avalere Health President Matt Brow, who has been involved in talks with the administration, said it’s clear the focus on overseas pricing isn’t going away and the administration is “talking a lot about how to get the president what he wants.”

5. Increasing Competition

FDA Commissioner Scott Gottlieb has become the Trump administration’s lead proponent for increasing competition among drugmakers.

Competition resonates with Americans “because people see it every day in their experience in Costco and other places,” said Rena Conti, an assistant professor at the University of Chicago.

Gottlieb has announced plans to bolster the use of generic drugs and an “action plan” to encourage the development of biosimilars, which are copycat versions of expensive biologic drugs made from living organisms.

And to combat anti-competitive behavior in the market, Gottlieb said the FDA has passed along information to the Federal Trade Commission and hinted at potential action to come: “I think we’ve handed them some pretty good facts.”


KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

Clinicians Who Learn Of A Patient’s Opioid Death Modestly Cut Back On Prescriptions

Physicians and other medical providers modestly reduced the volume of opioids they prescribed after being told one of their patients had died of an overdose, according to research published Thursday.

“You can hear a lot of statistics about the crisis,” said Jason Doctor, lead author of the study, published Thursday in the journal Science. “But it always feels like it is happening elsewhere if you are not aware of any deaths in your own practice.”

The research included more than 800 clinicians — doctors, nurse practitioners, physician assistants and dentists — comparing those who received a letter from the medical examiner about a patient’s death and those who didn’t. The ones who knew about the overdose death cut the overall volume of opioids they prescribed by almost 10 percent over three months, while those who didn’t know prescribed roughly the same amount as before.

The study shows that awareness and education can change prescribing behavior, said Doctor, lead author and associate professor at University of Southern California’s Price School of Public Policy. The modest size of the reduction among those who were notified of a death suggests “that clinicians exercised greater caution with opioids rather than abandoning use,” according to the study.

The providers in the study who were informed about patients’ deaths were also 7 percent less likely to start new patients on opioids.

The letter did not blame providers for the deaths but showed that authorities were paying attention, according to the study.

“We were providing them with important information and also giving them a way to make things better by changing prescribing,” Doctor said. “Anyone who got the letter could continue to prescribe as much as they wanted, but we found that they didn’t. They became more judicious prescribers.”

Over 19,000 people died from prescription opioids in 2016, roughly double the number 14 years earlier, according to the National Institute on Drug Abuse. Most of that increase occurred from 2002 to 2011, and the numbers have been relatively stable since then, according to the NIDA.

Meanwhile, prescriptions of opioids are declining, and health officials are seeking ways to accelerate the trend.

The study did not measure whether the letters from the medical examiner or the changes in prescribing patterns had any effect on patient deaths.

Across the country, physicians have been accused of overprescribing opioids and have even faced charges related to patient overdose deaths. In an effort to better track prescribing patterns, states have started prescription drug monitoring databases.

The CDC recommends that providers avoid opioids if possible, but if they are necessary, they should start with the lowest effective dose.


KHN’s coverage in California is supported in part by Blue Shield of California Foundation.

Pharmacy-Made Pain Creams Flagged On Fears Of Medicare Fraud And Risk

Medicare pays hundreds of millions of dollars each year for prescription creams, gels and lotions made-to-order by pharmacies — mainly as pain treatments. But a new report finds that officials are concerned about possible fraud and patient safety risks from products made at nearly a quarter of the pharmacies that fill the bulk of those prescriptions.

“Although some of this billing may be legitimate, all of these pharmacies warrant further scrutiny,” concludes the report from the Office of the Inspector General for the Department of Health and Human Services.

In total, 547 pharmacies — nearly 23 percent of those that submit most of the bills to Medicare for making these creams — hit one or more of five red-flag markers set by investigators. Those included what the researchers called “extremely high” prices; large percentages of Medicare members getting identical drugs — 16 of the pharmacies billed for identical drugs for 200 or more customers; “greatly increased” year-over-year billing — 20 pharmacies increased their billing by more than 10,000 percent; or having a single medical provider writing more than 131 prescriptions. More than half of those pharmacies hit two or more measures — and 10 hit all five.

One Oregon pharmacy, for example, submitted claims for 91 percent of its customers. A pharmacy in New York submitted 5,342 prescriptions ordered by one podiatrist, while a Florida pharmacy saw its Medicare billing for such treatments go from $7,468 in 2015 to $1.8 million the following year.

Many of the pharmacies are clustered in four cities: Detroit, Houston, Los Angeles and New York.

The report comes amid ongoing concern by Medicare officials about these custom-made — or compounded — drugs. In addition to questions like those raised in the report about overuse and pricing, safety has been a key issue in recent years. A meningitis outbreak in 2012 was linked to a Massachusetts pharmacy that did not maintain sterile conditions and sold tainted made-to-order injections that killed 64 Americans.

When done safely, pharmacy-made compounded drugs provide a legitimate option for patients whose medical needs can’t be met by commercially available products mass-produced by pharmaceutical companies. For example, a patient who can’t swallow a commercially available prescription pill might get a liquid version of a drug.

State boards of pharmacy generally oversee compounding pharmacies, and the drugs they produce are not considered approved by the Food and Drug Administration.

The new report focuses on concerns with compounded topical medications.

Medicare spending for such treatments has skyrocketed, rising more than 2,350 percent, from $13.2 million in 2010 to $323.5 million in 2016. Price hikes and an increase in the number of prescriptions written drove the increase, the report said.

It is not the first time the inspector general has looked at compounded drugs. A 2016 report found that overall spending on all types of compounded drugs — not just topical medications — rose sharply. The U.S. Postal Service inspector general and the Department of Defense also have raised concerns about rising spending and possible fraud for compounded drugs.

In response to those previous reports, the International Academy of Compounding Pharmacists, the industry’s trade group, has said that legitimately compounded drugs “can dramatically improve a patient’s quality of life,” noting that proper billing controls need to be in place. The inspector general’s report in 2016, it added, found that “such controls are not in place.”

This report, which the compounding trade group has not yet reviewed, focuses on topical drugs and a subset of the 15,290 pharmacies that provide at least one such prescription each year. It looked at billing records from the 2,388 pharmacies that do at least 10 such prescriptions a year — providing 93 percent of all compounded topical drugs paid for by Medicare.

Most of the prescriptions were for pain treatment, made from ingredients such as lidocaine, an anesthetic, or diclofenac sodium, an anti-inflammatory drug.

On average, those compounds were more expensive than non-compounded drugs with the same ingredients.

For example, Medicare paid an average of $751 per tube of compounded lidocaine, and $1,506 for the diclofenac, according to the inspector general’s report. Non-compounded tubes of those drugs averaged $445 and $128, respectively.

FDA Commissioner Scott Gottlieb recently outlined new efforts his agency is taking to oversee compounded drugs in the wake of legislation passed by Congress following the meningitis outbreak.

“The FDA is inspecting compounding facilities to assess whether drugs that are essentially copies of FDA-approved drugs are being compounded for patients” who could otherwise take a product sold commercially, he said in a statement issued on June 28.

Gottlieb also said the FDA plans to make more information available to patients and their doctors about compounded topical pain creams, including information about their effectiveness and any potential safety risks.

Not being effective is a safety risk, noted Miriam Anderson, a researcher with the inspector general’s office who helped write the report.

The report urged the Centers for Medicare & Medicaid Services to clarify some of its policies to emphasize that insurers can limit the use of compounded drugs by requiring prior authorization or other steps. The agency concurred with the recommendations, according to the report, including the need to “follow up on pharmacies with questionable Part D billing and the prescribers associated with these pharmacies.”

Anderson said the inspector general’s office is continuing to probe the issue.

“We will investigate a number of leads on specific pharmacies and prescribers who were identified as having these questionable patterns,” she said. “Whenever we see that kind of increase in spending, it raises concern about fraud, waste and abuse.”


KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

Medicaid Expansion Making Diabetes Meds More Accessible To Poor, Study Shows

Low-income people with diabetes are better able to afford their medications and manage their disease in states that expanded Medicaid under the Affordable Care Act, a new study suggests.

The Health Affairs study, released Monday afternoon, found a roughly 40 percent increase in the number of prescriptions filled for diabetes drugs in Medicaid programs of the 30 states (including Washington, D.C.) that expanded eligibility in 2014 and 2015, compared with prior years.

By contrast, states that didn’t embrace the Medicaid expansion saw no notable increase.

“Gaining Medicaid insurance would have significantly reduced out-of-pocket spending for insulin for previously uninsured patients, thereby facilitating uptake of the medication,” the Health Affairs study said.

Diabetes, characterized by abnormally high blood sugar, is a chronic disease thfat requires expensive and ongoing medical care.

In the long run, preventing diabetic complications not only saves lives, but it improves public health and saves public money,” said Dr. Michael Bush, an endocrinologist in Beverly Hills, Calif., and president of the California chapter of the American Association of Clinical Endocrinologists.

Bush and other experts said the Health Affairs study shows that the Medicaid expansion can help patients manage their health and also limit unnecessary spending. An analysis by the Centers for Disease Control and Prevention cited by the study shows that each diabetic patient who is treated for the condition can lead to a $6,394 reduction in health care costs (in 2017 dollars) because of fewer hospital admissions.

In California, roughly 3.9 million people gained coverage when the state expanded eligibility for Medi-Cal, the state’s version of the federal Medicaid program. In all, about 13.5 million people — more than one-third of Californians — are enrolled in Medi-Cal.

By 2016, about 12 million people had enrolled in Medicaid nationwide as a result of the expansion, according to the Kaiser Family Foundation. The foundation estimates that more than 2 million people who live in non-participating states would have qualified for Medicaid had their states chosen to expand. (Kaiser Health News is an editorially independent program of the foundation.)

“It’s not particularly surprising that extending Medicaid opened up this door for lots of other people to be able to fill prescriptions and be able to take advantage of managing a chronic disease like diabetes,” said Flojaune Cofer, director of state policy and research at Public Health Advocates, a nonprofit organization based in Davis, Calif., that seeks to eliminate health inequalities in California.

But Michael Cannon, director of health policy studies at the libertarian Cato Institute, said the Medicaid expansion may not mean good news for everyone.

Medicaid pays a fraction of a drug’s list price, so pharmaceutical companies may hike prices for everyone if they don’t feel they’re being compensated fairly, he said. That, in turn, could drive up everyone’s premium costs or lead those with private insurance to pay more out-of-pocket.

“You have to look at not just the immediate effects of a policy, but all of the effects of a policy,” Cannon said. “As prices rise, fewer people will be able to afford diabetic medications.”

Last year, nearly 900,000 Californians with Medi-Cal were known to have diabetes, according to state figures.

One of them is James Warden, 62, a retired rancher near Fresno, Calif., who said he was forced to stop working because of a back injury several years ago.

Warden enrolled in Medi-Cal in 2016 and was diagnosed with diabetes last year after a urinary condition landed him in the hospital, he said. Without the coverage, he said, he wouldn’t have the insulin his body needs.

“Medi-Cal saved me,” he said. “I wouldn’t have the money to be able to pay, or go to the doctor or anything.”

The researchers found that people in groups with a higher prevalence of diabetes before the ACA became law, such as those ages 55–59, showed larger increases in filling their diabetes prescriptions after the Medicaid expansions.

The price of insulin, a staple medication for many diabetes patients, rose almost 200 percent from 2002 to 2013, according to the study.

And nearly 40 percent of insulin users who responded to the American Diabetes Association’s 2018 insulin affordability survey reported that they had faced a price increase in the past year. As a result of the price hikes, many said, they took less of the medication, missed doses or switched to a cheaper drug.

In states that didn’t expand Medicaid after 2014, such as Texas and Florida, the number of diabetes prescriptions filled remained relatively flat, the study found. In these states, low-income and uninsured diabetics must rely on a “patchwork of options” to get insulin and other medications to treat their disease, according to the American Diabetes Association. Patients may need to seek help through drug company patient assistance programs or charities, the group said.

The study also showed a surge in filled prescriptions for newer, pricier diabetes drugs that have fewer side effects and control diabetes more effectively. And there was an increase in prescriptions for metformin, a generic drug that is often used as a first line of treatment for new Type 2 diabetes patients.

The rise in metformin prescriptions suggests the federal health law also led to more people being diagnosed with the disease, the authors said.

The study, conducted by University of Southern California pharmaceutical and health economists, was based on an analysis of filled prescriptions before and after the state Medicaid expansions began in 2014. The number of states that expanded Medicaid has since grown to 33 states and Washington, D.C.

The prescriptions analyzed cover the period from 2008 to 2015. About 15 percent of retail pharmacies did not share their information, and the data did not include prescriptions filled by health clinics or via mail-order, which could have led to underestimates of the total effect, the authors said.

Bush, the Beverly Hills endocrinologist, acknowledged that providing diabetes drugs to Medicaid patients is costly to taxpayers. But he said it’s money well spent.

“This is clearly a disease where if you take care of it now, you can prevent complications that occur later,” he said.


KHN’s coverage of these topics is supported by
California Health Care Foundation
and
Laura and John Arnold Foundation

This story was produced by Kaiser Health News, which publishes California Healthline, a service of the California Health Care Foundation.

Must-Reads Of The Week From Brianna Labuskes

A slow health news week wrapped up with a flurry of movement over the Affordable Care Act in the past few days. As we drift into August, there are definitely a few stories to keep an eye on.

Here’s what you might have missed:

The Trump administration issued a final rule on short-term plans. (The highlights: Coverage can go for 12 months and be renewed for a max of 36 months; it doesn’t have to cover essential benefits; and there aren’t preexisting conditions protections.) Officials were surprisingly candid (“We make no representation that it’s equivalent coverage”) in acknowledging the skimpiness of these plans — which were only ever supposed to act as three-month stopgaps for people between jobs.

The New York Times: ‘Short Term’ Health Insurance? Up to 3 Years Under New Trump Policy

For Democrats in the Senate, there’s a silver lining: The move gives them an opportunity to try to force Republicans — just months before midterm elections, mind you — to go on record voting against those popular provisions that short-term plans strip away. There’s no chance such a measure would pass the House (much less be signed by President Donald Trump), but it puts their colleagues across the aisle in a tough spot.

The Associated Press: Dems Will Try Forcing Senate Vote Against Trump Health Plan

The latest attempt to unmoor the ACA is just one in a series of grenades the administration has lobbed at the health law. But premiums aren’t spiking as much this year, insurers are joining the marketplace instead of fleeing it, and public support for Obamacare is skyrocketing. Has the war been already won?

Politico: Trump’s Losing Fight Against Obamacare

And, that wasn’t the only hubbub over the health law this week. Four major cities are suing Trump, saying his multiple attempts to “sabotage” the legislation is a failure of his constitutional duty to enforce the laws of the land. (Spoiler: They’re unlikely to be successful.)

Reuters: Four U.S. Cities Sue Over Trump ‘Sabotage’ of Obamacare

Passion over HHS’ decision to separate children at the border continues to boil. The government is now making the argument that the burden of reuniting deported parents with their children should actually fall on the American Civil Liberties Union. The ACLU fired back saying that the government is the one that made the mess, and officials shouldn’t be able to foist it off now that it needs cleaning up.

Politico: Trump Administration Tells ACLU to Find Deported Parents

An eye-popping price tag for a “Medicare-for-all” proposal dominated headlines early this week, but experts are saying there’s more to that $32.6 trillion than it might seem. Essentially, the plan would actually save money in overall national health care spending, but shift it over to the government — which means higher taxes.

Modern Healthcare: Libertarian Think Tank: Providers Would Pay for Medicare for All

Rebates are being painted as the new villain in the blame game that is the conversation around lowering high drug prices. Here’s a primer on what they are — but don’t get too attached, they might not be around for long.

The New York Times: Meet the Rebate, the New Villain of High Drug Prices

Bloomberg: Secret Drug Price Rebates Will Go Away, Pfizer CEO Predicts

If that’s not enough news for you, my miscellaneous file is chock-full: New VA Secretary Robert Wilkie is planning on reassigning the officials who have been at the heart of the morale crisis plaguing the agency; Medicare could save nearly $3 billion in a single year if it were able to negotiate drug prices as other agencies can; the FDA put the companies that were selling a dangerous class of opioids in charge of monitoring abuse of said opioids — and then did little to intervene over poor prescribing practices; and the drug industry is pumping millions in charity money into those very towns that are suing the companies over their role in the opioid crisis.

The Washington Post: New Veterans Affairs Chief Plans to Reassign, Sideline Trump Loyalists Now in Power

Stat: Medicare Could Save $2.8 Billion in a Single Year if Prices Could Be Negotiated

The New York Times: F.D.A. Did Not Intervene to Curb Risky Fentanyl Prescriptions

Bloomberg: Facing Wave of Opioid Lawsuits, Drug Companies Sprinkle Charity on Hard-Hit Areas

And as if childbirth wasn’t hard enough, this woman says she had to have a C-section without anesthesia.

Have a great weekend!

How Rival Opioid Makers Sought To Cash In On Alarm Over OxyContin’s Dangers

As Purdue Pharma faced mounting criticism over deaths linked to OxyContin, rival drugmakers saw a chance to boost sales by stepping up marketing of similarly dangerous painkillers, such as fentanyl, morphine and methadone, Purdue internal documents reveal.

Purdue’s 1996-2002 marketing plans for OxyContin, which Kaiser Health News made public this year for the first time, offer an unprecedented look at how that company spent millions of dollars to push opioids for growing legions of pain sufferers. A wave of lawsuits demanding reimbursement and accountability for the opioid crisis now ravaging communities has heightened awareness about how and when drug makers realized the potential dangers of their products.

The Purdue documents lay out how the company and its biggest competitors were jockeying for market share. Some of those drugmakers’ sales promotions downplayed or ignored the risks of taking opioids, or made false claims about their safety, federal regulators have asserted in warning letters to the companies.

Purdue first offered OxyContin as a remedy for moderate to severe cancer pain in 1996. Within three years, the company viewed the cancer market as too limited, with $261 million in potential annual sales versus $1.3 billion for a broader range of chronic pain care, the company’s marketing reports said.

“That was a pretty good recipe for a blockbuster,” said Andrew Kolodny, who directs Physicians for Responsible Opioid Prescribing, an advocacy group critical of drug industry marketing.

Purdue has become the most high-profile drugmaker linked to the surging opioid crisis. But other opioid manufacturers didn’t sit by idly as sales of OxyContin skyrocketed, topping $1 billion in 2000, despite reports of overdose deaths and addiction.

Purdue’s marketing reports indicate the company was worried about losing business to fentanyl-laced patches called Duragesic, as well as morphine pills and, to a lesser degree, methadone — which some managed-care groups and Medicaid health plans preferred because it cost much less than OxyContin. Methadone and morphine are made by a variety of drug companies.

In its 1999 marketing report, Purdue noted that Janssen Pharmaceuticals, an arm of drug giant Johnson & Johnson, was making “slow but steady” progress in promoting its Duragesic patches. The patches, which users attach to their skin, deliver a dose of fentanyl, an opioid drug about 50 to 100 times more powerful than morphine, according to the Drug Enforcement Administration.

Purdue estimated that Janssen would spend about $4 million in 1999 on medical journal advertising to persuade doctors to prescribe the patches for “early treatment of non-cancer pain and pain in the more frail elderly.” That is more than triple what Janssen spent the year before, according to the 2000 Purdue marketing report. In a statement to KHN, a Janssen spokesman said the company quit “actively marketing” Duragesic in 2008.

Purdue also spent millions on medical journal ads — and like Janssen, it drew criticism from the Food and Drug Administration for minimizing the dangers of opioids, government records show.

In 2000, the Food and Drug Administration criticized Purdue for exaggerating the benefits of using OxyContin to treat arthritis, while in 2003 the agency found that some other ads had “grossly overstated” OxyContin’s safety.

Janssen also drew the ire of the FDA. In March 2000, the agency called some claims made for Duragesic “false or misleading,” including the suggestion that the drug “has less potential for abuse than other currently available opioids.”

In September 2004, the FDA told Janssen to “immediately cease” making “false or misleading” claims, including saying that Duragesic was “less abused than other opioid drugs.” In its statement to KHN, Janssen said its marketing actions were “appropriate and responsible,” adding that it “acted quickly to investigate and successfully resolve FDA’s inquiries.”

The Purdue marketing reports are part of a cache of documents the company provided to the Florida attorney general’s office in 2002. The Florida attorney general released them to two Florida newspapers in 2003 after Purdue lost a court battle to keep them under wraps.

More than 1,500 groups, mostly cities, counties and states, are suing Purdue Pharma, Janssen and several competitors and drug distributers in federal court in Cleveland demanding reimbursement for treatment costs and other compensation. In a statement to KHN, Purdue said: “We vigorously deny these allegations and look forward to the opportunity to present our defense.”

The growing cluster of lawsuits argue that drugmakers set out to deceive doctors and the public by claiming their products presented little risk.

For its part, Purdue accused Janssen of trying to exploit public alarm over OxyContin-linked deaths to spark new sales of Duragesic.

“It has been reported that Janssen sales representatives are using improper techniques to capitalize on the negative press surrounding OxyContin Tablets and the issue of abuse and diversion,” reads the 2002 Purdue marketing plan.

In fact, opioids made by Purdue’s rivals also contributed to overdose deaths in those years and have continued to do so. In 2016, more than 42,000 people died nationwide from opioid-related causes, according to the Department of Health and Human Services.

Florida was one of the early states to see a rise in overdose deaths tied to prescription drugs. Florida medical examiner’s toxicology reports in 2002 detected oxycodone, the active ingredient in OxyContin, in hundreds of overdose fatalities. Abusers realized they could crush the pills and inject or snort the powder to get high. Many others died after mixing the pills with sedatives also prescribed by their doctors.

Florida medical examiner files also showed that abuse of fentanyl pain patches, methadone and morphine took many lives. Some abusers had figured out how to drain the Duragesic patch of its liquid fentanyl and inject it like heroin, or otherwise ingest it.

In July 2005, the FDA warned health care professionals about abuse of fentanyl patches. In December 2007, FDA cited reports of deaths and “life-threatening adverse events” when the fentanyl patch “was used to treat pain in opioid-naïve patients and when opioid-tolerant patients have applied more patches than prescribed, changed the patch too frequently and exposed the patch to a heat source.”

Purdue also kept an eye on methadone, noting in a 1999 marketing plan that “market research as well as reports from the sales force indicates that methadone use is increasing in both the management of cancer pain and non-malignant pain due to its low cost.” But as methadone won acceptance for treating pain, it also began to kill with alarming frequency.

The FDA in November 2006 warned of deaths and dangerous side effects among patients “newly starting methadone for pain control and in patients who have switched to methadone after being treated for pain with other strong narcotic pain relievers.”


KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

Patients With Chronic Pain Feel Caught In An Opioid-Prescribing Debate

It started with a rolled ankle during a routine Army training exercise. Shannon Hubbard never imagined it was the prologue to one of the most debilitating pain conditions known to exist, called ­­­­­­­complex regional pain syndrome.

The condition causes the nervous system to go haywire, creating pain disproportionate to the actual injury. It can also affect how the body regulates temperature and blood flow.

For Hubbard, it manifested years ago following surgery on her foot — a common way for it to take hold.

“My leg feels like it’s on fire pretty much all the time. It spreads to different parts of your body,” the 47-year-old veteran said.

Hubbard props up her leg, careful not to graze it against the kitchen table in her home east of Phoenix. It’s red and swollen, still scarred from an ulcer that landed her in the hospital a few months ago.

“That started as a little blister and four days later it was like the size of a baseball,” she said. “They had to cut it open and then it got infected, and because I have blood flow issues, it doesn’t heal.”

She knows it’s likely to happen again.

“Over the past three years, I’ve been prescribed over 60 different medications and combinations; none have even touched the pain,” she said.

Hubbard said she’s had injections and even traveled across the country for infusions of ketamine, an anesthetic that can be used for pain in extreme cases. Her doctors have discussed amputating her leg because of the frequency of the infections.

“All I can do is manage the pain,” she said. “Opioids have become the best solution.”

For about nine months, Hubbard was on a combination of short- and long-acting opioids. She said it gave her enough relief to start leaving the house again and do physical therapy.

But in April that changed. At her monthly appointment, her pain doctor informed her the dose was being lowered. “They had to take one of the pills away,” she said.

Hubbard knew the rules were part of Arizona’s new opioid law, which places restrictions on prescribing and limits the maximum dose for most patients. She also knew the law wasn’t supposed to affect her — an existing patient with chronic pain.

Hubbard argued with the doctor, without success. “They didn’t indicate there was any medical reason for cutting me back. It was simply because of the pressure of the opioid rules.”

Her dose was lowered from 100 morphine milligram equivalents daily (MME) to 90, the highest dose allowed for many new patients in Arizona. She said her pain has been “terrible” ever since.

“It just hurts,” she said. “I don’t want to walk, I pretty much don’t want to do anything.”

Hubbard’s condition may be extreme, but her situation isn’t unique. Faced with skyrocketing drug overdoses, states are cracking down on opioid prescribing. Increasingly, some patients with chronic pain like Hubbard say they are becoming collateral damage.

New Limits On Prescribing

More than two dozen states have implemented laws or policies limiting opioid prescriptions in some way. The most common is to restrict a patient’s first prescription to a number of pills that should last a week or less. But some states like Arizona have gone further by placing a ceiling on the maximum dose for most patients.

The Arizona Opioid Epidemic Act, the culmination of months of outreach and planning by state health officials, was passed earlier this year with unanimous support.

It started in June 2017, when Arizona Gov. Doug Ducey, a Republican, declared a public health emergency, citing new data, showing that two people were dying every day in the state from opioid overdoses.

He has pledged to come after those responsible for the rising death toll.

Arizona Gov. Doug Ducey’s moves against opioid over-prescribing initially faced resistance from the state’s medical associations.(Will Stone/KJZZ)

“All bad actors will be held accountable — whether they are doctors, manufacturers or just plain drug dealers,” Ducey said in his annual State of the State address, in January 2018.

The governor cited statistics from one rural county where four doctors prescribed 6 million pills in a single year, concluding “something has gone terribly, terribly wrong.”

Later in January, Ducey called a special session of the Arizona legislature and in less than a week he signed the Arizona Opioid Epidemic Act into law. He called it the “most comprehensive and thoughtful package any state has passed to address this issue and crisis to date.”

The law expands access to addiction treatment, ramps up oversight of prescribing and protects drug users who call 911 to report an overdose from prosecution, among other things.

Initially, Arizona’s major medical associations cautioned against what they saw as too much interference in clinical practice, especially since opioid prescriptions were already on the decline.

Gov. Ducey’s administration offered assurances that the law would “maintain access for chronic pain sufferers and others who rely on these drugs.” Restrictions would apply only to new patients. Cancer, trauma, end-of-life and other serious cases were exempt. Ultimately, the medical establishment came out in favor of the law.

Pressure On Doctors

Since the law’s passage, some doctors in Arizona report feeling pressure to lower patient doses, even for patients who have been on stable regimens of opioids for years without trouble.

Dr. Julian Grove knows the nuances of Arizona’s new law better than most physicians. A pain doctor, Grove worked with the state on the prescribing rules.

“We moved the needle to a degree so that many patients wouldn’t be as severely affected,” said Grove, president of the Arizona Pain Society. “But I’ll be the first to say this has certainly caused a lot of patients problems [and] anxiety.”

“Many people who are prescribing medications have moved to a much more conservative stance and, unfortunately, pain patients are being negatively affected.”

Dr. Julian Grove, a pain specialist, says that doctors were already facing pressure on many fronts to reduce treatment by opioids in Arizona.(Will Stone/KJZZ)

Like many states, Arizona has looked to its prescription-monitoring program as a key tool for tracking overprescribing. State law requires prescribers to check the online database. Report cards are sent out comparing each prescriber to the rest of their cohort. Clinicians consider their scores when deciding how to manage patients’ care, Grove said.

“A lot of practitioners are reducing opioid medications, not from a clinical perspective, but more from a legal and regulatory perspective for fear of investigation,” Grove said. “No practitioner wants to be the highest prescriber.”

Arizona’s new prescribing rules don’t apply to board-certified pain specialists like Grove, who are trained to care for patients with complex chronic pain. But, said Grove, the reality is that doctors — even pain specialists — were already facing pressure on many fronts to curtail opioids — from the Drug Enforcement Agency to health insurers down to state medical boards.

The new state law has only made the reduction of opioids “more fast and furious,” he said.

Grove traces the hypervigilance back to guidelines put out by the Centers for Disease Control and Prevention in 2016. The CDC spelled out the risks associated with higher doses of opioids and advised clinicians when starting a patient on opioids to prescribe the lowest effective dosage.

Psychiatrist Sally Satel, a fellow at the American Enterprise Institute, said those guidelines stipulated the decision to lower a patient’s dose should be decided on a case-by-case basis, not by means of a blanket policy.

“[The guidelines] have been grossly misinterpreted,” Satel said.

The guidelines were not intended for pain specialists, but rather for primary care physicians, a group that accounted for nearly half of all opioids dispensed from 2007 to 2012.

“There is no mandate to reduce doses on people who have been doing well,” Satel said.

In the rush to address the nation’s opioid overdose crisis, she said, the CDC’s guidelines have become the model for many regulators and state legislatures. “It’s a very, very unhealthy, deeply chilled environment in which doctors and patients who have chronic pain can no longer work together,” she said.

Satel called the notion that new prescribing laws will reverse the tide of drug overdose deaths “misguided.”

The rate of opioid prescribing nationally has declined in recent years, though it still soars above the levels of the 1990s. Meanwhile, more people are dying from illicit drugs like heroin and fentanyl than prescription opioids.

In Arizona, more than 1,300 people have died from opioid-related overdoses since June 2017, according to preliminary state numbers. Only a third of those deaths involved just a prescription painkiller.

Heroin is now almost as common as oxycodone in overdose cases in Arizona.

A Range Of Views

Some physicians support the new rules, said Pete Wertheim, executive director of the Arizona Osteopathic Medical Association.

“For some, it has been a welcome relief,” he said. “They feel like it has given them an avenue, a means to confront patients.” Some doctors tell him it’s an opportunity to have a tough conversation with patients they believe to be at risk for addiction or overdose because of the medication.

The organization is striving to educate its members about Arizona’s prescribing rules and the exemptions. But, he said, most doctors now feel the message is clear: “We don’t want you prescribing opioids.”

Long before the law passed, Wertheim said, physicians were already telling him that they had stopped prescribing, because they “didn’t want the liability.”

He worries the current climate around prescribing will drive doctors out of pain management, especially in rural areas. There’s also a fear that some patients who can’t get prescription pills will try stronger street drugs, said Dr. Gerald Harris II, an addiction treatment specialist in Glendale, Ariz.

Harris said he has seen an increase in referrals from doctors concerned that their patients with chronic pain are addicted to opioids. He receives new patients — almost daily, he said — whose doctors have stopped prescribing altogether.

Dr. Gerald Harris II, an osteopathic physician, specializes in treating addiction in Glendale, Ariz. He says he’s seen an increase in referrals from doctors concerned that their patients with chronic pain are addicted to opioids.(Will Stone/KJZZ)

“Their doctor is afraid and he’s cut them off,” Harris said. “Unfortunately, a great many patients turn to street heroin and other drugs to self-medicate because they couldn’t get the medications they need.”

Arizona’s Department of Health Services is working to reassure providers and dispel the myths, said Dr. Cara Christ, who heads the agency and helped design the state’s opioid response. She pointed to the recently launched Opioid Assistance and Referral Line, created to help health care providers with complex cases. The state has also released a set of detailed prescribing guidelines for doctors.

Christ characterizes this as an “adjustment period” while doctors learn the new rules.

“The intent was never to stop prescribers from utilizing opioids,” she said. “It’s really meant to prevent a future generation from developing opioid use disorder, while not impacting current chronic pain patients.”

Christ said she just hasn’t heard of many patients losing access to medicine.

It’s still too early to gauge the law’s success, she said, but opioid prescriptions continue to decline in Arizona.

Arizona saw a 33 percent reduction in the number of opioid prescriptions in April, compared with the same period last year, state data show. Christ’s agency reports that more people are getting help for addiction: There has been about a 40 percent increase in hospitals referring patients for behavioral health treatment following an overdose.

Shannon Hubbard, the woman living with complex regional pain syndrome, considers herself fortunate that her doctors didn’t cut back her painkiller dose even more.

“I’m actually kind of lucky that I have such a severe case because at least they can’t say I’m crazy or it’s in my head,” she said.

Hubbard is well aware that people are dying every day from opioids. One of her family members struggles with heroin addiction and she’s helping raise his daughter. But she’s adamant that there’s a better way to address the crisis.

“What they are doing is not working. They are having no effect on the guy who is on the street shooting heroin and is really in danger of overdosing.” she said. “Instead they are hurting people that are actually helped by the drugs.”

This story is part of a partnership that includes KJZZ, NPR and Kaiser Health News.

To Tame Prescription Prices, HHS Dips A Toe Into Drug Importation Stream

It came as something of a surprise when Health and Human Services Secretary Alex Azar announced that the administration was exploring the importation of prescription drugs to fight high domestic prices. Azar and Scott Gottlieb, commissioner of the Food and Drug Administration, who also endorsed the new proposal, had previously opposed the idea.

But drug prices in the U.S. have continued to rise and more than 80 percent of Americans say the government should take action. President Donald Trump has said drugmakers are “getting away with murder” and has angrily tweeted at companies about individual price hikes.

Although the candidate Trump supported the idea of allowing patients to import medicines, since he was elected he has not mentioned that option — which is strongly opposed by drug companies.

Now, determined to explore more avenues to curb price hikes, the administration is signaling that it is willing to consider what the industry regards as something of a nuclear option to address a recalcitrant problem. Carefully tailored to focus solely on specific situations where a high-priced drug is made by one company, it is finding support where broader proposals have failed.

“They’re approaching it incrementally and wisely, they’re focusing on prices where there’s a need,” said Dan Mendelson, the founder of health care consultant company Avalere and an official in the Clinton White House. “It is certainly more narrow than the way others have conceptualized it.”

Far from a blanket legalization of imported medicines, the working group Azar convened will study importation to combat sudden price increases in specific drugs. The focus is on temporarily bringing in cheaper similar or identical drugs to introduce competition into the U.S. market. The medicines must be off-patent and have only one manufacturer here.

Azar’s memo said the effort is designed to avoid the kind of overnight increases seen with Daraprim in 2015. That price hike was engineered by “pharma bro” Martin Shkreli, then CEO of Turing Pharmaceuticals. He purchased the rights to the single-sourced medication that treats parasitic infections and began charging $750 for a pill that formerly cost $13.50 and costs a little more than a dollar in much of the world. Turing was the only U.S. producer.

“This is a workable solution to a discrete problem,” said Ameet Sarpatwari, an instructor in medicine at Harvard Medical School in Boston.

But those who support more sweeping importation policies decried the plan’s limited scope and suspected the announcement was part theatrics and part a threatening signal to drugmakers.

“This could just be a dog-and-pony show, where they’re calling in an expert group to explore avenues of importation — but when all is said and done, they find that they don’t want to do this,” said Gabriel Levitt, the co-founder of PharmacyChecker.com, a private company that verifies international online pharmacies and compares prescription drug prices for consumers.

“At that point, we’ll learn that the exercise was lip service,” he added. “Frankly, there’s a good chance that that is the case.”

This isn’t the first time officials have suggested importing drugs from other countries to find better prices. Bills have been offered in Congress to allow it, and George W. Bush administration officials investigated the issue and produced two reports questioning the safety of such efforts in 2004.

Overall, the measure is by no means a silver bullet to the larger problem of rising drug prices, said Rachel Sachs, an associate professor of law at Washington University School of Law in St. Louis.

“It’s a really smart move to solve one of the many drug pricing problems we observe, but, of course, it won’t address every problem,” Sachs said.

Mendelson suggested this working group might be an effort to placate patients who have seen little movement to bring down drug costs, despite the president’s repeated promises to provide help.

“If the goal is to make policy changes that are visible and help with the 2018 and 2020 election, I think it’s right up there with a lot of the things they’re doing,” Mendelson said. “If the goal is truly to help consumers with drug prices, not so much.”

In addition, since the group’s work applies primarily to the generic drug market, a new policy would stop short of taming the price spirals and high launch prices of blockbuster brand-name drugs, which Harvard’s Sarpatwari said were the “elephants in the room” of the drug pricing debate.

Levitt pointed out that while a big overnight increase on a drug might trigger action to allow importation, the move would do nothing to stop the yearly increases that drug companies tack on to medicines. Depending on how possible regulations are written, such increases might even be encouraged. The administration has been pressuring pharmaceutical makers to hold down those rising prices but finding tepid support among the companies.

Even if the policy targets just a slice of the overall problem, it could still make a difference for Americans struggling to pay for off-patent drugs and provide more competition.

“If Azar is serious about this proposal, even though it’s very limited in scope, it could help deter the most egregious forms of drug price gouging where there are single-source meds,” Levitt said.


KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.