Webinar Recap: Experts discuss soaring drug prices and how reporters can cover the story

There’s no question that prescription drug prices are skyrocketing in the United States, and consumers aren’t happy about it. What’s more complicated, though, is understanding the complexities of the issue and reporting on what those soaring prices mean for consumers.  

Speakers at Reporting on Health’s recent webinar — “What Soaring Drug Prices Mean for Patients” — described consumer perceptions of rising drug costs; discussed how prices are impacting patients; addressed theories on alternative pricing models; and offered tips on localizing the story. Speakers included Dr. Mollyann Brodie who leads Kaiser Family Foundation’s public opinion survey program; Dr. Peter B. Bach, the director of Memorial Sloan Kettering’s Center for Health Policy and Outcomes; and Kristin Gourlay, health care reporter for Rhode Island Public Radio, whose 2014 radio series “At the Crossroads” looked at the rise of hepatitis C  and the expensive new drugs that can now effectively treat it.

Citing recent figures from the August Kaiser Health Tracking Poll, which sampled the public’s view about prescription drugs and pricing, Brodie said the cost of prescription drugs was a key issue for consumers across party lines — despite the often contentious partisan debate surrounding healthcare and the Affordable Care Act.

But even though people acknowledged concerns about pricing, many still said prescription drugs were easy to afford. That could be because their health insurance picks up much of the cost, reducing the financial burden, Brodie said. But that doesn’t mean people don’t notice the original price tags.

“Perhaps because they see these charges of drugs so regularly – even when they just have to pay a $10, $15 or 25, or even a $60 copay, the public believes it’s the prices set by pharmaceutical companies that are the real problem,” she said.

Among the solutions supported by survey participants: More price transparency, government negotiations with drug companies on behalf of Medicare, price limits for high-cost drugs, and importation of drugs from Canada.  

Even though traditional political battle lines emerge when government regulation is mentioned, the public concern over drug prices is widespread.

“That’s the point in the political cycle we’re in now,” Brodie said. “We’re at that initial state now, the alarm state, where it’s ‘Do something!’”

Bach, a physician whose public policy work focuses on the cost and value of anticancer drugs, shared charts that illustrated the dramatic rise in cancer drug costs over the last 50 years. Even though drugs are indeed improving over time, he said, they aren’t improving at a rate that justifies these price increases.

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Bach discussed some common theories for the rise, with his thoughts on the validity of each.

While a common theory is that innovation — and the research and development supporting it — is costly, prices are frothy even for copycat generics, which require no innovation.

Another suggestion is that prices may be high, but at least they’re rational. But that’s not always the case, Bach said, pointing to a slide that illustrated two cancer drugs approved this year — Farydak and Ibrance — that differ in everything from reductions in deaths achieved to side effects. Yet despite the drugs’ clearly disparate results, they both cost about $10,000 a month. 

“The question is: If prices make sense, how can these two drugs have the same price?” Bach said.

Another argument is that prices are high, but the market still works. Yet, if that were true, Bach countered, companies would lower prices as they gained a larger market share (as they recoup their investment costs). And, when competitors enter the marketplace, the market would respond accordingly. Bach then pointed to another graph which showed how prices steadily climbed for one drug even as new competitors entered the space.

“That’s not about recouping the price of investment … no one can look at this graph and say anything about the market is working,” Bach said.

Bach also focused on who suffers from such high costs: taxpayers, state Medicaid programs, the Veterans Administration Health Administration system, and patients, who may be unable to access life-saving medications. Specifically, he pointed to a leukemia drug that can turn a rapidly fatal condition into a manageable one:

Nothing could be more frustrating than for the scientific and biomedical research enterprise to have a drug that’s essentially a cure unavailable to patients because of a broken market.

So what might be done in response? One strategy is simply to say no to overpriced drugs, Bach suggested. For example, Memorial Sloan Kettering Cancer Center, where Bach works, balked at paying for one costly cancer drug, a move that led to the pharmaceutical company halving the price of that drug.

Another approach emphasizes the value of a drug to patients and doctors. Earlier this year, Bach’s center launched Drug Abacus, an interactive web site that provides a value calculator for cancer drugs. Users can alter the weight for features such as whether the treatment is for a rare disease and how severe the side effects are. Then, they can compare this “value-based” price to the drug’s actual price.

“This to me is a way to show that, as a proof of principle, we could have value-driven prices and we could have a transparent marketplace as well,” Bach said.  

The webinar concluded with health care reporter Gourlay discussing her series on Hepatitis C, which focused on the high cost of highly effective new drugs that can cure the disease. Her goal was to humanize the story of high price tags, which limit access to such game-changing drugs for many patients in need. (It can cost about $94,000 for a course of the new treatment, she said.)

But there was more to the story than just sticker shock for Gourlay. She also delved into questions such as: Will the drug help me? Will it harm me? Do I have access? Will my insurance cover it? How many patients might benefit? Can we afford to treat all patients?  Do we have to offer this treatment?

The conversation of costs can be an uncomfortable one when peoples’ lives are at stake, she said. But, in public health systems with limited funds, it has to be part of the conversation.

Gourlay said reporters doing stories on drug prices should always look at who is granted access to expensive treatments: Are insurers and other payers restricting access to a treatment because of its cost? (In the case of Hepatitis C, for example, the number of patients receiving the new drugs has been limited since treating everyone who was infected all at once could bankrupt the health system.) Often, patients need to be at a certain stage in their illness to qualify for treatment. And caring for sick prison inmates with tight budget constraints can lead to the rationing of treatment as well.

To localize the Hepatitis C story, journalists might examine how local agencies are attempting to curb injection drug use, or create needle exchanges. To find patients, Gourlay suggested talking to medical specialists as well as contacts at community health centers and addiction treatment clinics. State Medicaid agencies may provide estimates of the number of people with a certain diagnosis and share their policies for covering drugs and providing access.

In the Q&A, Bach discussed how accountable care organizations (ACOs) and their push to contain costs could lead to the elimination of high-cost drugs that are only marginally effective.

“That is actually a concern,” he said. “I may rail against the high prices of drugs but I am not going to rail against their minimal benefits because I know the science is hard. What I would like is for the two of those things to line up.”

Better aligning prices with the value of drugs is more beneficial than having doctors eliminate those drugs altogether. “Drug companies should be willing to sell products at a fair price,” he said. “And those with highly successful (drug) agents should garner more than those with poorer agents.”   

As valuable as it is to discuss the data and costs surrounding pharmaceuticals, it’s also important for physicians and reporters alike to remember that people’s lives and health are often at stake, said Kaiser’s Brodie.

We’re talking about something very emotional: We’re talking about the health and well being of people’s loved ones,” she said. “As important as it is to be talking about the economics… the other part of this is a very human story that is playing out in doctor’s offices, in hospitals, in people’s bedrooms and kitchen tables across the country.” 

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