nyceve posted a diary describing how policy holders of BCBS lose their coverage for filing a claim.
The state’s largest health insurer systematically — and illegally — cancels coverage retroactively for people who need expensive care, 10 former Blue Cross members claimed in lawsuits filed Monday.
And, an article in the NYT claims that the price of nitrogen mustard, used in treating some types of lymphoma, increased from $77.50 to $548.01 in a two week period.
more below
Last August, Merck, which makes Mustargen, sold the rights to manufacture and market it and Cosmegen, another cancer drug, to Ovation Pharmaceuticals, a six-year-old company in Deerfield, Ill., that buys slow-selling medicines from big pharmaceutical companies.
The two drugs are used by fewer than 5,000 patients a year and had combined sales of about $1 million in 2004.
Now Ovation has raised the wholesale price of Mustargen roughly tenfold and that of Cosmegen even more, according to several pharmacists and patients.
Sean Nolan, vice president of commercial development for Ovation, said that the price increases were needed to invest in manufacturing facilities for the drugs. He said the company was petitioning insurers to obtain coverage for patients.
The increase has stunned doctors, who say it starkly illustrates two trends in the pharmaceutical industry: the soaring price of cancer medicines and the tendency for those prices to have little relation to the cost of developing or making the drugs.
Doctors are questioning the reason for the increase. A Dr. Len Lichtenfeld, the deputy chief medical officer of the American Cancer Society stated,
“Nitrogen mustard has been around forever. There’s nothing that I am aware of in the treatment environment that would explain an increase in the cost of the drug.”
And, Dr. David H. Johnson, a Vanderbilt University oncologist, former president of the American Society of Clinical Oncology,
“I’d like to have some evidence from them that it actually costs them X amount, so that the pricing makes sense.”
According to Sean Nolan, vice president of commercial develepment of Ovation,
“It’s unfortunate that a price adjustment had to occur. Investment had not been made in these products for years.”
Ovation, which is privately held, needs money for research and development of new rx’s for rare diseases, Nolan also claimed.
This contradicts a claim made by Henry A. McKinnell, the chairman of Pfizer. In his book, McKinnell writes
that drug prices were not driven by research spending or production costs.
“A number of factors go into the mix [of pricing.] Those factors consider cost of business, competition, patent status, anticipated volume, and, most important, our estimation of the income generated by sales of the product.”
Also, once a price is set, the FDA does not regulate it, nor is Medicare supposed to consider price when deciding whether or not to cover a rx. Compare w/private insurance companies, as they are allowed to consider price in determining whether or not it will be covered and under which formulary.
As a result, the price of many medications, in particular, cancer medications have increased rapidly. This is the second time that the price of an anti-cancer drug has been increased by Ovation. As reported by the NYT,
In 2003, the company bought Panhematin, a treatment for a rare enzymatic disease called porphyria, from Abbott Laboratories. While Abbott still produces Panhematin, Ovation raised Panhematin’s price, which had been $230 a dose, to $1,900, according to Desiree Lyon, executive director of the American Porphyria Foundation.
The price of other cancer medications has also increased. For example, in 1992, Bristol-Myers Squibb was being protested for charging $4,000 a year for Taxol, a breast cancer treatment.
Now, most new cancer treatments are priced at $25,000 to $50,000 annually. In some cases, companies are pushing through substantial price increases on already-expensive drugs.
Last year, Genentech raised the price of Tarceva, a lung-cancer drug, by about 30 percent, to $32,000 for a year’s treatment.
Dr. Susan Desmond-Hellmann, the president of product development for Genentech, justified the price increase
“Tarceva was a more powerful and more active agent than what we understood at the time of launch, and so more valuable.”
In other words, it works, so make it available to only to those who can afford it.
According to Dr. Richard Hoppe, a professor of radiation oncology at Stanford University Mustargen’s previous price was a comparative bargain, giving Ovation the chance to increase it.
“There’s only one company that makes the drug, and they can decide what it’s worth.”
Mustargen’s sales are tiny and its patent has expired, so no drug maker will produce a generic.
After reading nyceve’s diary and this, it is worth wondering if the rx cos. have prices cancer treatments so high, that they are cancelling coverage of cancer claims in order to show a profit?
And, sadly, many cancer medications are not covered under Medicare D(isaster) without a prior-authorization, or going through step therapy.
Also available at My Left Wing. And thanks to elfling!
Surely the drug companies and insurance companies see that this escalation cannot continue indefinitely. More and more people are being driven out of coverage and away from the medication that they need. People will die. Fewer persons will have the insurance assistance to help pay for these horrendous costs. What will it take for citizens to demand that our representatives put a stop to this obsence profit-making?
do not have sufficient funds to purchase the product, therefore the loss of these individuals would not constitute a loss of revenue for the company.
Business is business.
What will it take for citizens to demand that our representatives put a stop to this obsence profit-making?
I really thought that Medicare D(isaster) and all of the after-effects of the program would be the start of things. But, so far, that hasn’t happenned–it appears to only be an important issue if a person is effected by it.
Maybe this drastic price increase will wake people up…
This is horrible — not that it should be any surprise. It’s pretty clear that when we accept profit as the guiding motivation for health care, then profit is the priority — not health care.
I posted this comment to an open thread at the orange place yesterday, but it fits here so I’ll share it.
This is just a quick note to let you know what I’m planning to do this weekend, and for the next however many weekends it takes to make a difference. I’d really appreciate any ideas or guidance for making this flyer more effective. Also, I’m planning to make more flyers — so if you have ideas for something with a slightly different focus, please let me know that also.
I’m going to start leafletting my neighbors on the subject of affordable health care.
Here’s a draft of a flyer:
Are you mad as #@L# about the state of Health Insurance in this country?
I am.
* I’m mad because I want to start my own business, but I can’t because diabetes makes me uninsurable
* I’m mad because one of my children works for a small business that doesn’t provide health insurance for employees and he can’t afford to buy it for himself.
* I’m mad because I’m so worried about what will happen to us and our future if we have to pay for a major medical problem.
* I’m mad because I found the United States Census statistics and the numbers are shocking. In some parts of the country over 50% of the people don’t have health coverage.
And I’m mad because we buy our representatives in Washington the best health care plans possible — and they couldn’t care less if we’ve got protection or not.
Here in Johnson County 7.5% of our neighbors don’t have health insurance (It’s 12.1% for Douglas county & 17.9% in Wyandotte County — Miami County has 8.2%). I can’t imagine what will happen to those that get cancer, or a chronic illness like MS. Treatments for some of those illnesses are more than most of us make in a year.
Hell yes, I’m mad — and you should be too!
Contact Information for local representatives:
(List will follow)
Contact me if you would like to help spread the word about this terrible inequity:
katiebird@gmail.com / My website (in development)
I’m going to be polishing it this week and plan to pass it around this weekend. I’m hoping it helps make people realize that things can change. But they won’t as long as we don’t pressure the people in power.
And as long as it is about profit, profit will be made, and as Kidspeak points out, people who do not generate profit will die.
Your project is a great idea! It will be interesting to learn about the level of interest in this issue in your community, I think a lot of people sincerely believe that the politicians work for them, and will “do something” before they are slated for elimination, that only the poor will be receiving these letters, which is in a way, true, but the bar of “not poor” is undergoing an “adjustment,” as the company functionary called it.
“that only the poor will be receiving these letters”
What letters?
referring to the people whose insurance was cancelled, and those who learned that their cancer drugs would now cost so much more, but it was really just a figure of speech, because really anyone could receive the letter, but it will mean death only for those without the funds to purchase the medication from their own resources.
Which makes them automatically “poor.” They cannot afford to purchase medical treatment at the market price, therefore the value of their labor has decreased to a level below the price of their survival.
Yes, and their entire extended families are doomed. Because what do you do if your uninsured brother-in-law is diagnosed with cancer. What is your responsibility to your sister with MS, if she isn’t insured?
Our current system is the world-wide-web of doom.
Good idea katie. Something has to be done about this. Thing is, who actually foots the bill for congresscritters insurance? So, why should congresscritters be treated better than me, you, or anyone else?
The cost increase may in part be due to added insurance costs for the production and handling of a material that is also a potential chemical terror weapon. In fact, it’s toxic enough that special precautions are needed for those caring for the sick so they aren’t affected by incidental exposure! I’d have to be on my last legs before I’d want them to use this stuff on me…
In two weeks!!! I don’t think so!
This whole idea that drug companies spend billions of their own money on research is another one of those red herrings to justify their outrageous drug prices. I’ve read articles (and can’t find them right now)of how these drug companies get billions of tax payer dollars for their research-surprise surprise-Not.
As for cancer drugs skyrocketing-disgusting but no surprise there either…although it would seem that the stupid drug companies might just price themselves out of anyone being able to afford these drugs-not just poor people and then where will they be? The drug companies not the people who died from not being able to afford their right to a healthy life.
if you can find the links, post them here, please. Thanks.
Hey Kid…I will look tomorrow…but time for me today to have to go rest-but I will look for them.
Understand completely–I am a night owl–not usually good for anything before noon! Thanks!
http://tinyurl.com/zr46t Hi Kid, here’s one link about another cancer drug-Taxol-that was basically ripped off from taxpayers(with the help of lax government not getting percentage of money back from drug company)from 2003 I believe. This was from government website. I have several more-but due to the fact that I don’t know how to do more than one link at a time(I say embarrassedly)I’ll have to go back and get a few other articles.
Warning: Be prepared to get even more pissed off(ha if that’s possible right)about how the taxpaying public is being played for suckers by the drug companies and our government-once again or still really. I know when I first started finding out about this several years ago I was beside myself with a real rage.
http://tinyurl.com/hbbdx Here’s another article from Taxpayers For Common Sense about this subject of drugs/drug companies and the NIH.
A lot of research on drugs is funded federally. At my institution, one psychiatric faculty member has done a lot of research on a very popular anti-anxiety drug, testing it on children. He’s gotten funding from NIH as well as the drug company.
I have proposed that any drug developed or tested in any part through federal funds must be sold at the cost of production plus a modest profit, with the total severely limiting the amount that advertising contributed to the production cost, and the profit percent set by an independent board whose members have terms don’t permit stacking of the membership by a single administration.
For an example of such studies, here is a link to just a few studies focusing solely on treatments for schizophrenia, many of which are drug interventions:
publicly funded drug trial examples
That’s one that I’m putting on my things to do list. Thanks!
Here’s a link supporting Chocolate Ink’s comments above on the cost of drugs being due to advertising more than research and development. The link is to an article that’s part of a series published by AARP on the cost of drugs:
Drug Profits vs. Research
Now that is at the top of the list!!! Thanks again!!
That is a good one! Thanks again–will take a bit of time, but worth it!!
The NCI is where our government puts money into all sorts of cancer research. A lot of this, but not all, goes to things that end up on BigPharma’s list of products for detection and treatment of cancer.
Here’s a link to the NCI budget request for 2007. Congress often gives the NCI more funding than the administration asks for – cancer treatment is very popular with voters.
Nation Cancer Institute Funding
If you look around at this same website, you’ll find more than you probably want to know about cancer treatment trials, research projects, etc.
[Full Disclosure: Although I am not a cancer researcher, I have been slighly involved in one NCI study, as a result of my research on children. The project did not involve drugs. It focused on changing eating habits of girls to decrease their risk for future breast cancer.]
This is some of the I’ll dig into it when I can stuff. But, it will get done. I am learning more about health care and the rx industry than I ever thought that I would. But, it is interesting and hopefully some good will come out of all of this.
Thanks.
I guess Republicans must not get cancer.