MoPIRG Drug Study on Prescription Drugs
Mon., July 3, 1978 3G Busting Drug Costs ST. LOUIS POST-DISPATCH POST-DISPATCH POST-DISPATCH By Eric P. Mink Of the IVst-DispaK IVst-DispaK IVst-DispaK h Staff No matter how much you're paying for your prescription drugs, you'd probably like to pay less. And beginning Jan. 1, 1979, that may be possible. That's when Missouri's so-called so-called so-called "generic substitution" substitution" law, a law that might save you a lot of money, takes effect. One of the reasons for the high cost of drugs according to investigations and studies made over the last 12 years or so by consumer groups, federal agencies and congressional committees is brand names. To encourage research and development development of new drugs, the U.S patent laws award a drug patent holder the exclusive right to market its formula for 17 years. So when a manufacturer develops, patents patents and markets a new drug, it also comes up with a brand name for it. After 17 years, other companies can duplicate the drug chemically and market it under different names. But by that time, physicians have had 17 years practice practice writing prescriptions using the catchy, brand name. Most of them continue continue to do so, even though the duplicated drugs called generic drugs are usually usually much cheaper than the original. And laws in most states still forbid pharmacists pharmacists from substituting the less expensive generic drugs for the brand name equivalents. equivalents. The result: Consumers end up paying paying a lot more than they need to. Here's an example: Eli Lilly and Company, one of the world's largest drug manufacturers, developed Darvon Com-pound-65, Com-pound-65, Com-pound-65, Com-pound-65, Com-pound-65, a mild painkiller. The generic name for the chemical combination that makes up Darvon is propoxyphene. According According to an extensive 1975 study of prescription prescription drug pricing by the Missouri Public Interest Research Group (Mo-PIRG), (Mo-PIRG), (Mo-PIRG), consumers in St. Louis at the time could have paid anywhere from $3.05 to $5.40 for 36 capsules of Darvon; the same quantity of propoxyphene ranged from $2 to $3.85. Sen. Gaylord A. Nelson, D.-Wis., D.-Wis., D.-Wis., whose Monopoly and Anticompetitive Activities subcommittee has held numerous hearings hearings on the drug industry, gave an even more dramatic example in a 1967 Senate speech. A major drug company, he said, was selling a given quantity of a high blood pressure drug to pharmacists for $39.50. But it offered to sell the same quantity of the same drug to the Defense Department for 60 cents, about two percent percent of its cost to pharmacists. Even at that price, the company lost the Defense Department contract to a competitor that bid 51 cents. This year, in response to such findings and pressure from consumer groups, both the Missouri and Illinois legislatures passed passed generic substitution bills. Although there are some minor differences, the two laws are very similar. The Illinois law, incidentally, took effect last Saturday. Here's the way things will work in Missouri: All forms on which prescriptions are written will have two different lines at the bottom for the physician's signature. Under a line at the right will be the words, "dispense as written." Under a line at the left will be the words, "substitution permitted." permitted." If the physician prescribes a drug by its brand name as happens, according to some estimates, 90 percent of the time and signs, the "dispense as written"" line, the pharmacist must fill the prescription prescription with that brand. If the doctor signs the "substitution permitted" line, however, the pharmacist is free to substitute a cheaper drug identical identical to the branded drug but marketed under a generic name. If a physician phones in the prescription, he is supposed to tell the pharmacist whether or not he agrees to generic substitution. According to the law, if the pharmacist does substitute substitute a generic drug, it must cost less than the brand-name brand-name brand-name drug that had been prescribed. prescribed. There are some exceptions. At least twice a year, the state Department of Consumer Affairs, Regulation and Licensing Licensing will publish a list of drugs for which substitution is not permitted. Drugs on the list will be those that are still under patent patent and that, therefore, have only one supplier, and those drugs that behave differently differently in the body than their generic equivalents. Just how much the law will affect consumers consumers is uncertain. Missouri Rep. Bob Feigenbaum, D.-Ferguson, D.-Ferguson, D.-Ferguson, who co-authored co-authored co-authored co-authored the bill, said that it's still up to the doctor to decide whether or not to substitute. substitute. But the consumer, he said, can push for substitution by asking his physician if it would make any difference to substitute a generic drug. "The role of the consumer is to inquire and question," Feigenbaum said. If the doctor agrees to substitution, he said, the consumer should ask his pharmacist pharmacist if cheaper generic substitutes are available for the prescribed drug. During the initial period after the law takes effect, everyone will be going through a learning process, Feigenbaum said. He said he hoped that "market competition" will work to "bring prices down overall. People will be more or less shopping around now, and it's important to let people know that there are competitive competitive prices," he said. It's also important to realize that "not any old generic drug is suitable" for substitution, substitution, he said. "It's not worth the savings savings to risk health. We've got to protect consumers both ways." Consumers themselves hold the key to any benefits the new law may hold for them, said MoPIRG attorney Tom Ryan. "The opportunity is there. Now it's going to take a very educated consumer population population to get the best out if it." "The trick," he said, "is making the health system respond to consumers so that there's more competition. If people are more concerned about cost, then the system will have to respond. "It's still up to the consumer to take the initiative," Ryan said. For some reason, reason, "consumers have not been as price conscious about prescription drugs as they are about other things food, for example. But when people are sick they don't do a lot of price shopping. All they want to do is take care of the sickness," Ryan said. What the law does, in addition to making making substitution legal, he said, is help make consumers aware "of the possibility of other drugs at lower prices" being available. The new generic substitution laws will not, by themselves, assure consumers of getting the least expensive drugs that f their doctors believe they need. ' 1 - . v s Y 1 J- ininfmwwii jiiiilnniiiniiiiii.mil fifiim m r- r- jMMWnritiiiniiiiiiillitnniimrwm niniiiiillniiiiHii Tiitnniilftaitirmnmimf'fi,ii,innaan,'ii -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f -ntc"i-'--f-v-'fS"'-f Why not? First, the Missouri and Illinois Illinois laws deal only with prescriptions written by trade or brand name. If a doctor doctor writes a prescription using a drug's generic name, something for which consumer consumer groups have been pushing for years, pharmacists are free to fill the order with any drug they have that meets the chemical description, including an expensive trade-named trade-named trade-named product. Second, nothing in either law requires pharmacists to pass on all their savings on a drug to the consumer. A pharmacist could, for example, substitute a generic drug that costs him dollars less than a trade-named trade-named trade-named product, but charge the customer customer only a few pennies less, pocketing the additional savings. Increased price-consciousness price-consciousness price-consciousness and comparison shopping by consumers, as well as plain, old competition, competition, should keep this practice to a minimum. Another problem is storage space in pharmacies. A given drug might be manufactured manufactured by several different companies who sell it at different prices. But a pharmacist pharmacist does not have the space to stock all of them. He has to choose which companies' companies' drugs to keep on hand based on price, demand, availability, credit terms and so on. As a result, some pharmacies will be cheaper on some drugs and more expensive on others. Again, said Mo-PIRG's Mo-PIRG's Mo-PIRG's Ryan, consumers should learn about comparing prices from pharmacy to pharmacy, as well as from trade name to generic name. For years, drug manufacturers claimed that their trade-marked trade-marked trade-marked products were superior in quality and effectiveness to the chemically-identical chemically-identical chemically-identical generic drugs. Except in a very few cases, according to the Food and Drug Administration, that is simply not the case. As far back as 1972, the director of the FDA's Bureau of Drugs, Dr. Henry E. Simmons, spoke of the conclusions drawn from years of testing testing and analysis by the agency's laboratories. laboratories. "Based on many years of experience with this program," he said, "we are confident there is no significant difference between so-called so-called so-called generic and brand name antibiotic products on the American market " Testing on non-antibiotic non-antibiotic non-antibiotic drugs, done at the FDA's National Center for Drug Analysis Analysis here in St. Louis, produced similar results. "On the basis of the data we have accrued to date," Dr. Simmons said, "we cannot conclude there is a significant difference difference in quality between the generic and brand name product tested."