HEALTH

Plenty of blame to go around on high drug prices

Jan 8, 2020, 6:12 AM | Updated: Jan 9, 2020, 12:09 pm

The rising cost of prescription drugs has some Utah families going to an "underground network" in o...

The rising cost of prescription drugs has some Utah families going to an "underground network" in order to afford their medication. (IMAGE: KSL Newsradio)

(IMAGE: KSL Newsradio)

Listen:

MURRAY, Utah — Nick DeNunzio calls himself a “Utah boy”, as he was born and raised in the state. Like most diabetics in the United States, he spends thousands of dollars a year on his medical care and to buy the two life-saving insulins Toujeo and Novalog.

“The scariest part about being a diabetic is walking into the pharmacy and [thinking] how much is this going to cost me this time? Is my coupon still good? Is the coupon not good? Is this medicine that I’ve been taking for the past two years and costing me $25 a month because of the coupon–all of a sudden now I don’t have any more coupons–and now it calls $400 a month,” DeNunzio says.

DeNunzio has gone to Canada and Mexico to fill his prescriptions before, however, local pharmacists have also helped find him coupons to reduce the cost of his prescriptions.

But what DeNunzio and other Americans pay at the pharmacy counter is only part of the story.

Medicare, one of the largest purchasers of prescriptions in the country, has to pay for certain drugs regardless of price. This, in turn, drives up the cost of these medications for everyone.

There are also companies called Pharmacy Benefit Managers (PBMs). They negotiate prices between manufacturers and pharmacies. But pharmacists have accused them of overcharging pharmacies and pocketing the difference, something the PBMs deny.

Dr. Rena Conti from Boston University says PBMs have helped keep prices for generics low. Brand name or newer drugs, however, are a different story.

“Their business model is predicated in part on buying low and selling high. They don’t necessarily face the strongest incentive to pass off those discounts and rebates that they get to patients at the pharmacy counter,” Conti says.

That’s something John Hansen from Taylorsville found out when a billing company affiliated with a PBM charged his insurance 10 times the normal rate for the medications he needed. Hansen had been hit by a drunk driver and discovered the charges as part of a court case.

The pharmacy he went to was paid about $3 for each medication while the billing company made more than $100 per prescription.

“It was a guaranteed amount that shows how certain companies will insert themselves for maximum profitability not maximum benefit,” Hansen says.

Hospitals, insurance companies, and sometimes pharmacies buy low and sell high as well.

For example, Walgreens had profits of over $4 billion in 2018, mostly from filling prescriptions. In its defense, Walgreens says 97% of prescriptions filled there, “are paid for using some form of insurance coverage or savings program.”

The biggest question for many people is why insulin prices are so high since it’s an off-patent drug with several choices.

Insulin manufacturers have been sued for colluding, as some brands have raised their prices by similar amounts several times since 2008.

Whether that’s true or not, there is another issue. Because of a law passed in 2010, the FDA has until March of this year to approve any new generics for insulin. If they do not, companies will have to reapply to get their medication approved. And it usually takes about a decade for a new drug–even one that’s a low cost, life-saving alternative–to legally come to market.

In 2019 and 2020, the FDA approved a pair of generic Insulins. But they are manufactured by Novo Nordisk and Eli Lilly, some of the companies accused of colluding on prices. Some patients and pharmacies have also been reporting shortages or been taking the companies to task for not promoting the generic forms, something the companies deny.

We want to hear from you.

Have a story idea or tip? Send it to the KSL NewsRadio team here.

Today’s Top Stories

Health

A new release from Intermountain Healthcare shows that younger adults are becoming more susceptible...

Waverly Golden

Younger adults are becoming more susceptible to strokes

A new release from Intermountain Healthcare shows that younger adults are becoming more susceptible to stroke.

11 months ago

Melissa Coleman crouches next to her husband, , Brad Coleman, of North Ogden, who sits in a wheelch...

Jenny Carpenter, KSL.com

Young stroke victim survives with quick, lifesaving treatment in northern Utah

After a 36-year-old man had a stroke, he and his wife say to be aware of the signs of stroke and that young people are also at risk.

11 months ago

(Canva)...

Michelle Lee

How, and why, a hobby can bring joy to your life

If it brings you pleasure, is meaningful, and you can do it regularly, you've got yourself a hobby! Here's why they can benefit us so much.

11 months ago

A new release from Intermountain Healthcare shows that younger adults are becoming more susceptible...

Alexandrea Bonilla

Utah clinics winning the fight against overprescribed antibiotics

Intermountain Health and the University of Utah found that urgent-care facilities were more likely to prescribe antibiotics as a quick, easy solution.

11 months ago

Utah Food Bank...

Allessandra Harris

Utah Food Bank aims to ‘Stamp Out Hunger’ this summer

The Utah Food Bank is joining forces with the Letter Carriers Union to collect non-perishable food items for those in need.

11 months ago

...

LEANNE ITALIE AP Entertainment Writer

Mommy blogger Heather Armstrong, known as Dooce to fans, dead at 47

Armstrong had laid bare her struggles as a mother and her battles with depression and alcoholism on her site, Dooce.com, and on social media since 2001.

11 months ago

Sponsored Articles

close up of rose marvel saliva blooms in purple...

Shannon Cavalero

Drought Tolerant Perennials for Utah

The best drought tolerant plants for Utah can handle high elevations, alkaline soils, excessive exposure to wind, and use of secondary water.

Group of cheerful team members high fiving each other...

Visit Bear Lake

How To Plan a Business Retreat in Bear Lake This Spring

Are you wondering how to plan a business retreat this spring? Read our sample itinerary to plan a team getaway to Bear Lake.

Cheerful young woman writing an assignment while sitting at desk between two classmates during clas...

BYU EMBA at the Marriott School of Business

Hear it Firsthand: 6 Students Share Their Executive MBA Experience at BYU’s Marriott School of Business

The Executive MBA program at BYU offers great opportunities. Hear experiences straight from students enrolled in the program.

Skier being towed by a rider on a horse. Skijoring....

Bear Lake Convention and Visitors Bureau

Looking for a New Winter Activity? Try Skijoring in Bear Lake

Skijoring is when someone on skis is pulled by a horse, dog, animal, or motor vehicle. The driver leads the skiers through an obstacle course over jumps, hoops, and gates.

Banner with Cervical Cancer Awareness Realistic Ribbon...

Intermountain Health

Five Common Causes of Cervical Cancer – and What You Can Do to Lower Your Risk

January is National Cervical Cancer Awareness month and cancer experts at Intermountain Health are working to educate women about cervical cancer.

Kid holding a cisco fish at winterfest...

Bear Lake Convention and Visitors Bureau

Get Ready for Fun at the 2023 Bear Lake Monster Winterfest

The Bear Lake Monster Winterfest is an annual weekend event jam-packed full of fun activities the whole family can enjoy.

Plenty of blame to go around on high drug prices