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Michael Murchie

Dr. Gareth Euridge

ENC1102

27 July, 2020

I Need my Medicine but Its To Expensive

Have you ever seen those commercials on TV about getting your prescription costs lower

with apps on your phone and think just get insurance to cover it or why don’t you have insurance

in the first place? Well, most of the time they do have insurance and the price for medicine is still

in the hundreds. This is a growing problem in the United States recently and its affecting many

Americans all over the country who can’t get the medicine they need to survive or get through

the day. For example, Cami Schiel, RN, JD, MBA notes “One of the highest price categories is

prescription drugs. Id. In 2019, drug companies raised the prices of over 3,400 drugs at an

average rate of 10.5%” (Schiel 1). This doesn’t like a lot but in reality, these raises in prices are

what causes millions of Americans to struggle finding a way to get what they desperately need.

What makes it worse is there is no actual reason why these companies are raising the prices of

their drugs. Consequently, Americans are taking drastic steps to secure what they need to

survive, Holly Rosenkrantz a political journalist and ex US house correspondent notes “Nystrom,

33, recently started organizing trips to Canada to get insulin, which has doubled in price over the

past five years. In Canada, diabetics can purchase insulin for $30 a vial, versus $300 for the same

amount in the United States. These trips, however, violate a U.S. law that forbids, for safety

reasons, U.S. citizens from buying drugs abroad” (Rosenkrantz 3). These illegal actions are
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actually gaining support from the other Americans who are in the same predicament, just trying

to survive and not lose their medicine.

There are many causes to this issue which include, Insurance not covering it all, all the

drugs sold are in America are made here which cost way more than foreign drugs which are just

as effective. Also the drug market is a natural monopoly meaning only a few big corporations

make all these drugs and with no competitors they have the power to make the prices whatever

they choose, while PBMs (pharmaceutical business managers) are the actual ones who raise the

prices. They claim the cost reflects the research and testing when in reality they get grants from

the govt. for testing. To top it all off the government and insurance companies virtually have no

power to negotiate prices with these companies there are now laws or polices that give the

government the ability to step in if things get out of control and restore balance. The only way

for a permanent solution to this is the US needs government intervention to fix these issues. With

government intervention it will allow foreign drugs to come into to America and effects the

monopoly market, PBMs will have to comply with price regulations and price lowering

applications like GoodRx for example will be more widely accepted at pharmacies and the

government will and should have the power to regulate these companies.

From an economic perspective of this issue the prescription drug market is a monopoly,

no one or even govt. has laws or the power to stop it. Meaning that there are only a small handful

of companies that produce all these drugs we go to the pharmacy and buy. With that being said

these companies have complete and total power to do whatever they want with the prices. Since

there are no other companies producing prescription drugs there is no way of infiltrating this

monopoly with another competitor to influence price competition. There have been many talks
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about prescription drugs from foreign countries being aloud in to take down this monopoly.

“Some politicians have championed foreign importation of drugs

to introduce competition and push prices downward. They claim these drugs are identical to

those in America, but sell for 50, 60, or 70% lower abroad” (Schiel 2). With Government

intervention into the prescription drug market these foreign companies will be aloud to sell their

drugs to the American market. Taking away the current monopoly which will result in these

domestic companies lowering their prices as well, so they do not go out business. Overall,

creating lower prices across the board in all types of prescription drugs. However, these foreign

drugs do not always have the same marks identifying the type of medicine so there will need to

be some type of regulation agency to ensure the right drugs are coming in. On the bright side this

will create more jobs in a new industry for Americans.

My second argument for why we need government intervention in the prescription drug

market is the PBMs (Pharmaceutical business managers) need to be regulated and the only thing

with enough power to do so is the government. The PBMs play a big role in prices, “The drug

makers also say another player in the prescription drug market — pharmacy benefit managers —

is driving up prices. These companies manage benefits for insurers, employers, and the

government, but they have become powerful middlemen between the insurance companies and

the drug makers. They play a big role in determining which prescription drugs are covered by

insurance, including Medicare, the federal health insurance program for people 65 or older, and

how much drugs cost. The deals these middlemen strike is largely hidden, and the work they do

substantially influences a drug maker’s profits” (Rosenkrantz 5). These people are big players in

the price determination, and they seem to only benefit themselves. What I mean is that these

people raise the price of drugs which just benefits themselves. They are causing pain and anxiety
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for Americans while just stuffing their pockets with cash. One recent action of these companies

is, “This year, pharmaceutical companies raised the prices on more than 250 prescription drugs.

These increases are making it difficult for millions of Americans to pay for critical medicines,

including insulin, according to survey data. Nearly three in 10 U.S. adults said they did not take

their medicines in the past year as directed because of the expense” (Rosenkrantz 4). This just

goes to show that PBMs don’t think about the people they are affecting, all they think about is

making profits. The PBMs are really okay with 3/10 adults not getting what they need to survive

while they make more money. These people can die if they don’t get their insulin, but I guess

that’s not the PBMs worry. However current actions by the government are being taken against

the PBMs, the lower drug cost now act 2019 was recently passed. “Eliminate “spread pricing”

that lets Pharmacy Benefit Managers (PBMs) retain a large portion of the drug payments by

limiting PBMs’ ability to mask a source of their revenue” (Schiel 2). This is a huge step in the

right direction. With this being enacted it will cause the PBMs to think twice about pricing and

how it affects Americans instead of how it affects their wallet.

Finally, the government needs to intervene in the prescription drug market because they

are the only ones that can actually make a difference and force these companies to comply. Its

not like these price raises does not affect politicians it affects everyone. The government is

supposed to protect us and by intervening they will be. In fact, “President Trump has repeatedly

denounced the cost of prescription drugs. “Pfizer & others should be ashamed that they have

raised drug prices for no reason,” he said in a July 2018 tweet. “They are merely taking

advantage of the poor & others unable to defend themselves, while at the same time

giving bargain basement prices to other countries in Europe & elsewhere. We will respond!”

(Rosenkrantz 5). The political community is answering the calls of its citizens and trying to make
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changes coming from the very top. Two recent bills where passed, the Lower Drug Cost Now

Act of 2019 and the Prescription Drug Price Reduction Act. These Bills do a multitude of things

which include: “Permit the Centers for Medicare and Medicaid Services

(CMS) to negotiate prices for as many as 250 of the most expensive drugs, including insulin, for

Medicare Part D…Change federal reinsurance from 80% to 20% for brand

name drugs and 40% for generic drugs, thereby incentivizing plans to shift usage to less costly

alternative … Require drug companies to rebate any price increases that exceed inflation… Limit

out-of-pocket drug spending for Medicare beneficiaries… Require drug companies to offer the

prices negotiated by HHS to all commercial plans.” (Rosenkrantz 1-2). Along with many more of

benefits to the citizens along with reducing the power and corruption of the prescription drug

market. These are very important moves made by the government to help its citizens which will

now doubt help reduce prices of these drugs. These two bills alone will do everything: Break the

monopoly, reduce the PBMs power, and set regulations and force companies to comply to them.

All in all, the problem of rising prescription drug prices needs to be address and looked at

seriously because it affects citizens all across our country and in many ways. We need to serious

and long-term changes to this issue or else Americans will die or get in legal trouble from getting

drugs from other countries. The government cannot just sit by and let this happen any longer.

Thankfully, they haven’t and have started address the issue. However, they cannot stop here, the

government must continue to intervene and put a stop to this.

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Works Cited
There are no sources in the current document.

BURJEK, ANDIE. “Contracting a Cure for Prescription Drug Costs.” Workforce, vol. 96, no. 4, July 2017,

pp. 22–49. EBSCOhost, search.ebscohost.com/login.aspx?

direct=true&AuthType=shib&db=a9h&AN=123801225&site=ehost-live.

Schiel, Cami. “Why Can’t I Self-Check Out My Percocet?: Evaluating Current Drug Pricing Proposals

through the Lens of the Opioid Crisis.” Utah Bar Journal, vol. 33, no. 2, Mar. 2020, pp. 33–

41. EBSCOhost, search.ebscohost.com/login.aspx?

direct=true&AuthType=shib&db=a9h&AN=142089796&site=ehost-live.

Rosenkrantz, Holly. "Prescription Drug Costs." CQ Researcher, 26 July 2019, pp. 1-55,

library.cqpress.com/cqresearcher/cqresrre2019072600.