Jess Franz-Christensen did not realize the seriousness of her son’s Type 1 diabetes diagnosis until staff in the doctor’s office offered to call an ambulance to take him to the hospital.
Her next shock: The cost of Jack’s medicines.
The drugs, administered through an insulin pump, cost $1,200 a month.
“We’re really fortunate. We’re able to pay for stuff,” said Franz-Christensen, whose husband, Scott, is a physicist, while she stays home to care for Jack, 8, and their daughter, Kendall, 11.
“But there are people who are making decisions whether to feed their kid or get test strips — whether to pay rent or get a vial of insulin. It’s heart-breaking.”
Prices for insulin products have nearly doubled in recent years, including Lantus SoloSTAR — one of the drugs that Medicaid and Medicare spent the most on in 2015. Its price increased by 81.5 percent between 2011 and 2014, according to data analyzed by the Wisconsin Center for Investigative Journalism. The data were provided by California-based First Databank, a supplier of U.S. commercial drug pricing information.
Overall, the price of insulin nearly tripled between 2002 and 2013, prompting calls this month for a federal investigation by former Democratic presidential candidate Sen. Bernie Sanders from Vermont.
“They (drug companies) are making billions and billions of dollars on people who literally can’t afford it,” said Franz-Christensen, who has joined #MyLifeIsNotForProfit, a national grassroots parent movement.
Recent nationwide news coverage has focused on the rising cost of EpiPens, which counteract potentially fatal allergic reactions to peanuts, bee stings and other triggers. But the $600 cost for a two-pack of that medicine is just one example of lifesaving drugs with skyrocketing prices.
The costs of seven widely prescribed antibiotics, cancer drugs, arthritis medications and other prescriptions have escalated between 29 percent and 5,241 percent in recent years, according to a joint investigation by the Wisconsin Center for Investigative Journalism, Wisconsin Health News and Wisconsin Public Radio.
The investigation examined the impacts of and reasons behind the overall rise in prescription costs, including drug price increases since 2011, using proprietary First Databank data.
Synthroid, which is used to treat hypothyroidism, is the most commonly prescribed medication in the United States and has been on the market for more than 60 years. In just the past six years, it has nearly doubled in price, according to the Center’s analysis. The generic version of Synthroid, levothyroxine, has gone from 14 cents to 46 cents per pill, an increase of 231 percent between 2011 and 2016, the analysis shows.
A single two-week dose for Humira, a medication that treats conditions including rheumatoid arthritis, plaque psoriasis and Crohn's disease, has increased 129 percent since 2011, to $2,000. Price increases have made Humira and other anti-inflammatory drugs among the most costly in the country, according to insurers.
The price increases, which continue to mount, place economic and emotional pressure on patients and their families, squeeze the budgets of health care providers and raise costs for taxpayers in Wisconsin and nationwide, the joint investigation found.
Lack of competition raises costs
Spending on medications is rising for a variety of reasons:
- Some pharmaceutical companies have taken action to extend the patent protections on their products, blocking cheaper generic versions from being developed.
- As some companies stop making certain low-cost drugs, other companies gain monopolies over the market.
- Companies are introducing more high-cost “specialty” drugs such as Humira that treat lifelong conditions.
- As the nation’s population ages, the demand for prescription drugs increases; more than half of Americans now use them.
One practice is known as “product hopping,” in which a company makes changes to a drug to extend its patent protections, keeping others from entering the market with cheaper alternatives.
Wisconsin Attorney General Brad Schimel filed an antitrust lawsuit in September alleging that the makers of Suboxone, a drug used to treat opiate addiction, changed their product from a tablet to a film that dissolves in the mouth to block alternatives and “maintain monopoly profits.”
The lawsuit alleges actions by Indivior and MonoSol Rx, beginning in 2009, helped generate $1 billion a year in sales of Suboxone. Indivior said it takes “these allegations seriously” and “intends to defend this and other related actions.”
There also have been fewer brand name drugs coming off patent and being replaced by lower-cost generics, said Larry Levitt, senior vice president for special initiatives at the California-based Kaiser Family Foundation.
According to a report from health care information company QuintilesIMS, in 2014, spending on medications increased at the highest rate since 2001. The increases were driven by “innovative” new medicines, a lower number of brand name drugs losing patent protection and price increases.
“As long as drugs are on patent protection, manufacturers at that point have monopoly pricing ability and they can price their products at levels that the market will bear,” said Chuck Shih, who leads Pew Charitable Trusts’ specialty drugs research initiative. “When that’s the case, they’re free to increase the prices of their products year over year.”
In addition, as competitors drop out of the market, the remaining companies are “raising prices significantly and earning substantial profits,” Levitt said.
For instance, he noted that an EpiPen competitor temporarily ceased production after a complete recall of its product. Levitt also pointed to the pharmaceutical company Valeant, which raised the price of two cardiac care drugs by 525 percent and 212 percent shortly after acquiring them.