The pharmaceutical industry claims the high prices of their medicines are there for good reason, but that’s just not true — and thousands are left suffering as a result.
Pharmaceutical company Mylan just settled a $465 million lawsuit with the Department of Justice over their 500 percent increase in price for the life-saving EpiPen. The company had increased the price for a 2-pack of EpiPens from $100 in 2009 to $608 today. Congress was rightly outraged at this price-fixing and demanded an investigation. Mylan will pay up and move on. Bad press and even such a hefty fine, in their calculation, would be well worth it if the process increases profits dramatically. Typical behavior for pharmaceutical companies.
As Oxfam and Doctors Without Borders (MSF) commented in the New York Times, this happens again and again, because companies have monopoly protections that ensure the lack of competition. Most of the time, it happens without any public notice or scandals. Pfizer alone raised the prices of more than 100 drugs in one year. While this often goes unnoticed, it has a major impact on public health throughout the world. And it means that poor people are simply priced out of the life-saving medicines. So they continue to suffer, or worse.
Pharmaceutical companies claim that such high prices are necessary for the research and development of new treatments, but that’s just not true and doesn’t quite square with the fact that nine out of 10 big pharmaceutical companies actually spend more on marketing than on research.
Not only does the US government side with the pharmaceutical industry, it’s actively seeking to export monopoly protections to other countries through trade agreements like the Trans-Pacific Partnership (TPP), which lock in rules that expand the monopoly power of drug companies, thus enabling them to raise prices at their whim.
Oxfam and MSF also recently joined the AARP, AFL-CIO and Consumers Union to send a letter to President Obama calling on him to avoid giving greater monopoly protections to biologic medicines, which are derived from living organisms and are becoming treatments of choice for many cancers and other illnesses. The pharmaceutical industry has been pushing hard for this before any action is taken to implement the Trans-Pacific Partnership trade deal.
Access to affordable medicines is a basic aspect of the human right to health and is an essential part of the Sustainable Development Goal 3 on health, as is the development of new medicines to treat diseases that primarily affect developing countries. But intellectual property rules in trade agreements and related policies rely on granting monopoly power to stimulate innovation, which results in high prices of medical products and often fails to deliver innovation that responds to people’s health needs. Such policies are incoherent with the human right to health and the commitment by governments to promote access to medicines for all.
Recognizing the problem and seeking ways to advance progress on the SDGs, the UN Secretary General appointed a high level panel of experts, including Oxfam’s international executive director, to recommend solutions to remedy this policy incoherence. Last month, the panel issued a major report on access to medicines with a number of important recommendations.
But the US State Department and pharmaceutical industry representatives questioned the Panel’s mandate and criticized its report, attempting to undermine the process and avoid any action being taken on the Panel’s important recommendations.
Nonetheless, the Panel recommended that governments begin to negotiate a new binding agreement on research and development based on the human right to health, rightly de-linking the financing of research from the price of products to help ensure their affordability. Further recommendations also included ensuring countries can exercise their right to protect access to affordable medicines under international trade rules and in free trade agreements, as well as transparency of information on research and development costs, medicine pricing, and trade negotiations.
While this administration has undertaken positive efforts to promote domestic and global health, its track record on enabling access to affordable medicines has been abysmal. All eyes are on the next administration to do the right thing.