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Dear FRONTLINE,I take my hat off to Maine and Oregon for the action they have taken against Big Pharma. However, I am discouraged by the Republican-led plan to turn any cost benefits into the private sector. There is such an anti-government sentiment prevalent in this country, that, once again, Bush and his cohorts will hoodwink the public into believing the market place is the safe place for any such reforms. This market mentality has turned patients into consumers and doctors into providers. Whatever happened to the moral belief of health as a right?
Edward Eckenfels
chicago, il
Dear FRONTLINE,
The issue of government subsidy of drug research, already mentioned in one posted letter, seems to be a significant oversight in your most recent program. For example, on one account, the federal government paid at least 55 percent of the research and development cost of the five top-selling drugs in 1995. The consumer group Public Citizen estimates that once public money is factored into research and development costs, the average cost for new drug development goes from the $500 million industry estimate to about $110 million in actual cost to the drug company. These numbers suggest that dire predictions of research and development drying up in the face of price controls are unwarranted scare tactics.
Joe Pettit
oak park, il
Dear FRONTLINE, I would stop attacking the pharmaceutical companies and really focus on HMO's. They dictate what drugs can be prescribed. Pharmaceutical companies are coming up with new delivery systems for out-dated drugs that will assist with patient compliance and HMO's do not want to put these improved drugs on their lists.
lansing, michigan
Dear FRONTLINE, just saw "The Other Drug War" and I wish I had taken notes. A couple of things spring to mind. By imposing price controls, Canada has effectively banned the drug companies from recovering their costs within a reasonable time frame. Maine, too, forces the drug companies to go where they can to recover their costs. Time frame is important; investors making an investment of several hundred million dollars over 10 or 15 years just to get a drug to market then have a relatively short time period to achieve the gains they sought. I believe that patent protection, though not mentioned in your piece, plays a role here. It is my understanding that the patent protection begins very early in the drug development process, so that by the time the drug comes to market, more than half of the patent protection period has elapsed. Perhaps patent protection could be extended so that drug companies have a longer period of time to recover their investment. It appears, for reasons I do not fully understand, that the drug companies recoup all of the expenses in bringing a drug to market against their domestic revenues. I suppose they have no choice when countries like Canada (and I'm sure there are others) won't allow them to recover costs. I noticed the piece didn't mention any world-class Canadian drug companies. Finally, the piece took a swipe at the level of profits that drug companies make, saying, in effect, that the industry's 18.5% profits is too high and that something closer to the median of 3% would be more acceptable. Following that logic, shouldn't we force the drug companies to become break-even businesses? Government regulation of the drug companies would give us something like what Ma Bell used to be; a monolithic, non-responsive behemoth. Only when the telecommunications industry was de-regulated did we begin to see the innovation that has come to mark this industry; cell phones, fiber optic networks, digital services--the list goes on. Yes, the telecommunications industry in general is in bad shape right now, but as one fails, others rise up. That's the way markets work. The Oregon approach seems by far to be the best solution, certainly it is better than price controls. From my own personal experience recently, while I had no health insurance, I can tell you that once made aware of the cost vs. benefit equation as it pertains to health care, I sought and found, lower cost health care. Give people the information and let them make their own decisions.
David Donaldson
laurinburg, nc
Dear FRONTLINE, Someone please cite for me an example where price controls have worked. Let's not forget that in Canada the entire health care system has price controls. That's the primary reason why you can wait years for a bypass surgery that can be scheduled in days here in the United States. A cardiologist in Canada is paid to perform x number of operations per year. Once they reach that number, they can continue to operate, they just don't get paid. Second of all, we are a free market economy, something the representative from Maine has seemed to have forgotten. What gives her the right to decide how much profit is too much profit? It is the blockbuster drug that pays for the new drugs in the future that let you live longer. It is also the blockbuster drug of today that pays for the thousands of other compounds that fail.
detroit, michigan
Dear FRONTLINE, I watched your program on prescription drugs with interest and some questions. I trust neither the drug companies nor the federal government when it comes to fixing the prescription medication problems. The drug companies sole desire is for more profits and the politicians are in the pocket of the drug companies who buy them off with donations to their campaigns. Only the ordinary American is ignored. I urge others to do what I do. Continue to purchase your medications from Canada. America is ranked 15th in quality health care throughout the world. Canada is ranked 5th. That should solve questions about the "quality" of medications from Canada!
Carol Sobeck
st. louis, missouri
Dear FRONTLINE,
Thank you for the information. It is unfortunate that there is not more focus on why the american population needs so much medication. We should be focused on the cause and PREVENTION of medicine rather than the affordability.
The pharmacuetical companies profit when we are ill, they are not interested in HEALTH care, but sick care. If we all took the initiative to research our illnesses, and find the CAUSE, we would see alternatives to medicine in many circumstances, maybe even all. Drugs are merely for symptoms, not to treat the cause of disease. I encourage everyone to RESEARCH their illness, drugs and alternatives. That would be cost effective!
April Macary
spartanburg, sc
Dear FRONTLINE, There are many valid arguments for both sides, but lets look at it across the board. Transportation is a necessity. Why not let the government control and subsidize automobile prices? A bigger question is who is supposed to pay for all of these price breaks? If the government subsidizes them, we, as tax payers must foot the bill. If the prices are controlled, we as a people pay the bill with our health. Why has the life expectancy gone up? Because medical care, prescription drugs in particular, have improved. Twenty years ago, even ten, the mortality and morbidity rates for diseases like cardiovascular disease, Alzheimers, infections, COPD, and asthma were significantly higher. Thank goodness for prescription drugs. Think about it like this: 10-20 years ago if someone was diagnosed with pneumonia, they were admitted to the hospital, placed on IV antibiotics, and the cost was astronomical. Today, thanks to newer antibiotics, these pneumonia patients can get a prescription filled and never step foot in a hospital and get well faster. Which is less expensive, a hospital stay or a $70 antibiotic? If the the Congress wants to take this on, let's cut the Congress's pay, benefits, and retirement to do it. If you think there is a conflict of interest with Pharma and doctors, what about Congressmen and lobbyists who provide transportation and entertainment? If we are going to scream about something, let's go after it all.
lufkin, tx
Dear FRONTLINE, Using the Federal Tax Code is an effective way to influence decison making at the Corporate level. Why not limit, or eliminate, the Federtal tax deduction for advertising by the Drug companies? Maybe they would stop advertising, which should cut demand for the higher price drugs. If not, then the extra federal tax revenue could go to pay for part of a Federal drug plan. It's worth considering.
Jim Powers
spirit lake, ia
Dear FRONTLINE, This Frontline program generally provided a fair and balanced perspective on the cost of prescription drugs and the political methods used to deal with the "problem". However, when you reported on the marketing of new drugs to patients and doctors, and the resulting increase in prescriptions written by doctors for expensive drugs, what struck me was that the doctors and patients are not DIRECTLY responsible for paying the cost of these drugs. Insurance pays for most of these costs. This is a perfect example of what happens when people think ( incorrectly ) that they are not paying directly for the cost of something. Medical care is no different in this respect than hamburgers, cars, or toilet paper. When government distorts the market, it creates weird incentives and bizarre outcomes, which in turn cause the political demand for MORE government control , which in turn causes MORE distortions, leading to more controls, etc. What is rarely asked, except by intelligent people, is whether government is the source of the problem in the FIRST place. Should it be a mystery that the 2 areas of our society which have the most problems, medical care and education, are also the 2 areas of our society in which government is MOST invovled ? What we need to do is get rid of employer-sponsored heatlh insurance, and let employers provide their employees with a stipend, or in the case of those without insurance, a tax credit, so everyone can buy their own insurance policies, in various groupings, or as individuals. If people SAW FIRST HAND what medical care costs, they would be more judicious about how they spend their dollars.
Jeffrey Hollinger
kansas city, mo
Dear FRONTLINE,
I am a former Chariman of a public television station. "Frontline" greatly sustains my admiration for public broadcasting. Your balanced coverage of the prescription drug problem is unique in its depth, breadth and fairness. In fact, every one of your programs exhibit these qualities. The "media" at large could and needs to learn how to report in the frontline manner. With the exception of PBS, we are exposed to print and broadcast reporting that is one-sided editorializing, rather than balanced investigative reporting. Keep up the good work. If there was an Oscar for reporting, you would earn it hands down.
Martin Becker
lake park, fl
Dear FRONTLINE, The elephant in the room is the sudden change of heart by drug companies to support a prescription drug benefit. It is painfully obvious that the efforts in Maine, Oregan and other states have altered the landscape. Drug companies now realize that there double digit profits for the past twenty years are at risk and they are opting for the lesser evil. The drug companies know it will be much easier to navigate the halls of congress with lobby dollars than fight out battles state-to-state. The reality is that while R&D dollars may be impacted, the greater portion of expenditures already goes to marketing. R&D is a red herring. This is yet another example of how the business lobby and their dollars have corrupted our elected leaders and short changed the American public.
Dan Alexander
dallas, texas
Dear FRONTLINE, I am a certified pharmacy technician and have been so for 11 years. I practice in the state of michigan which has instituted a policy for it's medicaid patients which is similar to the policy adopted by Oregon. In Michigan, medicaid members have access to medication on a preferred list. Those which are not on this list are not covered by the state's medicaid program. The state has cut down it's costs on medication without cutting back on the care the medicaid patients recieve. How is it that the state of Michigan can implment this cost saving plan and or federal goverment cannot?
Ed Evangelista
chesterfield twp, mi
Dear FRONTLINE, Uwe Reinhardt suggested in your Frontline report that imposing cost controls on drugs would result in cutbacks in R&D -- an argument the drug industry loves to make, since it levels a tacit threat against the health of American citizens who might dare to take action to curb their excesses. But Reinhardt has apparently not always believed this argument himself. In an interview for an article by Patricia Barry in the June 2002 issue of AARP Bulletin, Reinhardt, when asked whether price cuts harmed reseach, answered: "This argument has always puzzled me ... The truth is that R&D spending [as a percentage of revenue] is equal or higher in Europe than here," yet European countries all control drug prices.
Christopher Pedersen
rochester, ny
FRONTLINE's editors respond:
FRONTLINE asked Dr. Reinhardt about his remark in the AARP Bulletin and this is his response:
"I can see why that letter writer may have seen a contradiction in my remarks; but I think there isn't one.
I meant with it that the PERCENTAGE of revenue European drug firms devote to R&D is not that much lower than the comparable percentage spent here. I recall that for German manufacturers it's actually higher than ours. I was speaking merely about percentages of revenue, not absolute dollars. We are a big country and often tower in absolute dollars.
It is reasonable for the drug industry everywhere to argue that any action that reduces their revenues will reduce R&D. (1)ÝIt is probably true, although the actual magnitude of the response is unknown and (2) even if it were not true, it is plausible and, therefore, a good bullet in the debate on pharmaceutical policy.
When you think about it, though, the relationship between one country's drug-price policy and the R&D of its pharmaceutical industry must be complex. It is so because the market for, say, a German drug manufacturer is global. So if the German government uses price controls, that affects only a part of the global market faced by German manufacturers.
Now, the U.S. IS a big gorilla. If the entire, huge U.S. market for drugs were under tough price controls, that would undoubtedly have a more powerful negative impact on global R&D spending than if, say, Germany or Japan had such controls. That is another point to keep in mind.
Similarly, I have always found odd the argument made by the drug industry in one country (e.g., Germany, or the U.S.) that price controls in the country will drive its R&D operation overseas. Why would that be so? Suppose Germany had tough price controls but great research scientists that would work at relatively low wages. Wouldn't a smart drug company do its R&D there, regardless of the market for drugs there? I believe, for example, that before long, much pharmaceutical and biotech research will be done in Shanghai and India, for that very reason. |
Dear FRONTLINE, It seems to me that other countries who have implemented price controls are benefiting from the R&D that US citizens are funding through higher drug costs in the U.S. Perhaps the U.S. government should impose export tariffs on prescription drugs sold outside of the U.S., and those tariffs could then be used to reduce drug costs for U.S. citizens.
columbus, ohio
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