In a word, money. Hundreds of millions of the dollars that Americans spend on drugs find their way into campaign funds and lobbying efforts on Capitol Hill. In the past decade, the pharmaceutical industry has spent more than $2.5 billion lobbying Congress. Opensecrets.org reports that in 2016, the industry spent $245 million on lobbyists; the next biggest industry sector, insurance, spent nearly $100 million less.
Despite this investment, the industry is getting nervous. Drug prices are expected to climb more than 12 percent this year. Americans already spend an average of $858 a year on prescription medication, more than twice the $400 average in the 19 other leading industrial nations.
The political pressure is such that a kind of four-corner civil war has broken out. Employers, hit hard by rising insurance costs for their employees, are in one corner. Manufacturers are in another. Insurance companies are in the third, and pharmaceutical benefits managers – the biggest of which is Express Scripts – are in the fourth. The latter three are all pointing figures at each other.
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Express Scripts finds itself getting a lot of blame. Anthem, the nation’s second largest insurer, announced in April that it expects to drop Express Scripts as its pharmaceuticals benefits manager after 2019. Anthem claimed that it had been overcharged billions of dollars a year, a claim that Express Scripts strenuously denied – though it did offer Anthem a $3 billion concession if it would stick around.
Express Scripts is the only large pharmaceuticals benefits manager unaffiliated with an insurer or pharmacy. It makes its money as a middleman, negotiating prices with drug companies for insurance companies. Insurers now question how much of the savings are being passed on to them, their corporate clients and eventually to consumers.
Some members of Congress are wondering the same thing. These middlemen keep their deals secret, and bills have been introduced to force greater transparency.
Congress has also made efforts to allow state and federal health care programs to negotiate bulk price deals with manufacturers and to allow Americans to import drugs from other countries. Trump has said he supports both ideas.
But when Congress actually tried to move this legislation, it went nowhere. And Trump appointed industry-friendly regulators to key positions, even as he continued to tweet his outrage at high prices.
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