Later On

A blog written for those whose interests more or less match mine.

How Two Common Medications Became One $455 Million Specialty Pill

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Marshall Allen reports for ProPublica:

Everything happened so fast as I walked out of the doctor’s exam room. I was tucking in my shirt and wondering if I’d asked all my questions about my injured shoulder when one of the doctor’s assistants handed me two small boxes of pills.

“These will hold you over until your prescription arrives in the mail,” she said, pointing to the drug samples.

Strange, I thought to myself, the doctor didn’t mention giving me any drugs.

I must have looked puzzled because she tried to reassure me.

“Don’t worry,” she said. “It won’t cost you any more than $10.”

I was glad whatever was coming wouldn’t break my budget, but I didn’t understand why I needed the drugs in the first place. And why wasn’t I picking them up at my local CVS?

At first I shrugged it off. This had been my first visit with an orthopedic specialist and he, Dr. Mohnish Ramani, hadn’t been the chatty type. He’d barely said a word as he examined me, tugging my arm this way and bending it that way before rotating it behind my back. The pain made me squirm and yelp, but he knew what he was doing. He promptly diagnosed me with frozen shoulder, a debilitating inflammation of the shoulder capsule.

But back to the drugs. As an investigative reporter who has covered health care for more than a decade, the interaction was just the sort of thing to pique my interest. One thing I’ve learned is that almost nothing in medicine — especially brand-name drugs — is ever really a deal. When I got home, I looked up the drug: Vimovo.

The drug has been controversial, to say the least. Vimovo was created using two readily and cheaply available generic, or over-the-counter, medicines: naproxen, also known by the brand Aleve, and esomeprazole magnesium, also known as Nexium. The Aleve handles your pain and the Nexium helps with the upset stomach that’s sometimes caused by the pain reliever. The key selling point of this new “convenience drug”? It’s easier to take one pill than two.

But only a minority of patients get an upset stomach, and there was no indication I’d be one of them. Did I even need the Nexium component?

Of course I also did the math. You can walk into your local drugstore and buy a month’s supply of Aleve and Nexium for about $40. For Vimovo, the pharmacy billed my insurance company $3,252. This doesn’t mean the drug company ultimately gets paid that much. The pharmaceutical world is rife with rebates and side deals — all designed to elbow ahead of the competition. But apparently the price of convenience comes at a steep mark-up.

Think about it another way. Let’s say you want to eat a peanut butter and jelly sandwich every day for a month. You could buy a big jar of peanut butter and a jar of grape jelly for less than 10 bucks. Or you could buy some of that stuff where they combine the peanut butter and grape jelly into the same jar. Smucker’s makes it. It’s called Goober. Except in this scenario, instead of its usual $3.50 price tag, Smucker’s is charging $565 for the jar of Goober.

So if Vimovo is the Goober of drugs, then why have Americans been spending so much on it? My insurance company, smartly, rejected the pharmacy’s claim. But I knew Vimovo’s makers weren’t wooing doctors like mine for nothing. So I looked up the annual reports for the Ireland-based company, Horizon Pharma, which makes Vimovo. Since 2014, Vimovo’s net sales have been more than $455 million. That means a lot of insurers are paying way more than they should for their Goober.

And Vimovo wasn’t Horizon’s only such drug. . .

Continue reading.

And do read the whole thing. Later:

. . . With Vimovo, it seemed I stumbled on another waste stream: overpriced drugs whose actual costs are hidden from doctors and patients. In the case of Horizon, the brazenness of its approach was even more astounding because it had previously been called out in media reports and in a 2016 congressional hearing on out-of-control drug prices.

Health care economists also were wise to it.

“It’s a scam,” said Devon Herrick, a health care economist with the National Center for Policy Analysis. “It is just a way to gouge insurance companies or employer health care plans.” . . .

Written by LeisureGuy

20 June 2017 at 3:37 pm

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