If you've noticed your wallet feeling lighter after trips to the pharmacy, you’re not alone. The costs of many medications in the United States have been rising, and Martin Shkreli isn’t the only figure to blame. Humira, for example — the top-selling drug in the U.S. — has doubled in price since 2012, costing more than $38,000 a year per prescription.
Meanwhile, pharmaceutical companies struggle to develop new products at the rate that they could a few decades ago. Back then, there was plenty of uncharted territory to explore, in the quest to create new drugs. Now, it’s not nearly as easy to develop a new Crestor or Lipitor.
“There’s a cornucopia of new discoveries that make new drugs appear extremely promising, but the industry as a whole over the last few decades has found it harder and harder to discover new drugs, particularly drugs that are transformational or make a real difference, a radical difference in people’s lives,” said Barry Werth, author of the book, The Antidote: Inside the World of New Pharma.
At the same time, pharmaceutical companies feel compelled to deliver profits for their shareholders. While new drugs may take up to 15 years — and several billion dollars — to develop, companies need to make sure they aren’t wasting any resources, especially when only 10 percent of the drugs put into human trials will make it to the market.
“So they’re looking for areas where the science gives them a good shot, and they’re looking for areas where they’re going to be able to make a good return when they do it,” said Matthew Herper, a journalist for Forbes covering science and medicine.
As companies invest more in the development process, they raise the prices of their products. The problem is: our society doesn’t have a strong system in place to check these rising costs. The primary mechanism we use? Public shaming.
“It’s surprisingly effective when we do use it,” Herper said. “A couple reporters write a story saying, ‘Well they raised the price by this much,’ and a lot of companies have said, ‘Okay, well, we’re gonna not do that for a while.’”
Werth says that finally there is some pushback on high drug prices. But while some politicians have tried to mandate more transparency in how medications are developed, powerful lobbyists and high demand for pharmaceuticals make policy change unlikely.
As we debate how to lower health care spending, both Herper and Werth say the industry might not be the best place to look. Better health habits, for instance, could improve more lives than new medicines. And making the system more efficient — which may mean developing fewer drugs — could be a necessary step to maintaining our health care system.
