Steep drug price hikes harm patients, experts testify

Steep price hikes for some off-patent drugs harm patients by restricting access to potential life-saving medications, health care and health insurance experts testified at a congressional hearing Wednesday.

Responding to outrage from doctors and patients, the Senate Special Committee on Aging spotlighted supply problems that occur when government-authorized patents on medications expire and the drug rights are sold to new pharmaceutical companies that raise prices by as much as 6000%.

Committee members raised the prospect of adding new pricing rules to the federal government's existing drug oversight system.

"That balance we have struck never anticipated companies acquiring off-patent drugs and then jacking up their prices to enormous heights, and do so, as one executive essentially put it, 'because I can,'" said committee chairwoman Sen. Susan Collins, R-Maine. "But that is exactly what we have seen in recent months."

• Spiraling costs for two heart drugs owned by drugmaker Valeant Pharmacueticals International increased the Cleveland Clinic's total drug budget by $8.6 million, hearing testimony showed.
• North Carolina doctors treating a baby for toxoplasmosis were unable to get the Daraprim medication that targets the parasitic disease because Turing Pharmaceuticals had raised the price 40 times beyond its original cost. The doctors instead had to use an alternative medication.
• Erin Fox, director of the drug information service at the University of Utah Health System, testified that a price hike from $440 to $2,700 forced her to keep a Valeant heart drug locked up after removing it from medication carts where it previously had been available.

The hearing also focused on similar price hikes for drugs owned by Rodelis Therapeutics and Retrophin for treating hepatitis C and other illnesses.

The off-patent drugs in many cases face no generic versions that could provide market competition, and serve relatively small patient groups. Additionally, the new owners didn't spend millions of dollars to research and develop the medications.

"Valeant markets more than 200 prescription drugs and hundreds more non-prescription products, so broad conclusions about the company’s pricing can not be drawn from any one drug or set of drugs," said Laurie Little a vice-president of the Canada-based drugmaker. "We set prices based on a number of factors, including the cost of the development or acquisition of a drug, the availability of substitutes or generics, and the benefits it offers versus alternative treatments that might be more costly."

Although Valeant said it offered patient aid programs to ease the pain of price hikes, Fox said her calls to Valeant about the costs met with the same response: "Talk to your distributor."

Nancy Retzlaff, Turing's chief commercial officer, said the New York City-based firm is “committed to patient access"  and to developing therapies "for rare and neglected diseases." Pledging that no patient would be denied access to Daraprim she said more than 60% of the drug's output "is provided to patients at a $1 per prescription or less."

However, pharmacy benefit management giant Express Scripts this month said it would work with a compounding pharmacy to provide Daraprim to all patients for $1 per treatment.

Sen. Claire McCaskill, D-Mo., the committee's ranking minority member, said the committee's continuing investigation had found a pharmaceutical industry "market failure."

"And when there's a market failure, the government has a role in addressing it," said McCaskill.