Prescription Drug Prices: An investigation into costs and processes

11:14 a.m. Thursday, March 30, 2017 Homepage

In order to give our readers the best information from which to make health care decisions, the Dayton Daily News is digging into what drives prescription drug prices with a multi-part series.

Explore the investigation’s findings with the articles and video below.

File Photo

For every generic drug that costs next to nothing, there’s a Yervoy. The treatment for skin cancer costs more than $92,000 per user annually, or more than $250 a day. 

Consumers are kept hidden from this secret world of drug pricing, which is shrouded in layers of complexity that often confound the principles of basic economics.

Staff Writer
In this July 8, 2016, file photo, a pharmacist holds a two-pack of the EpiPen epinephrine auto-injector. Mylan last year began selling a generic version of the emergency allergy treatment after the high price for the branded option drew public scorn and congressional inquiries. (AP Photo/Rich Pedroncelli, File)

A pair of advocacy groups that get funding from the manufacturer of EpiPens are fighting an Ohio bill that seeks to make cheaper life-saving epinephrine auto-injectors more accessible.

Staff Writer
Pill bottles sit on the shelf of Waynesville Pharmacy. CONTRIBUTED PHOTO.

An unnamed Dayton man is at the center of a $15 billion lawsuit that pits two often vilified segments of the health care system against one another over the cost of prescription drugs. 

John Doe One is an HIV/AIDS patient whose bills for the life-saving drug Atripla — even with insurance coverage — have been more than $1,200 a month, according to the class-action federal lawsuit in which he’s a lead plaintiff.

Pharmacist Phil Pauvlinch works at the Equitas Health Pharmacy in Dayton, formerly AIDS Resource Center Ohio. Hepatitis C and HIV patients who get pharmacy benefits through Medicare Part D are being hit hard by rising out-of-pocket costs. KATIE WEDELL/STAFF

High-priced prescription drugs are driving up the cost of Medicare Part D catastrophic coverage, which is bad news for both patients and taxpayers, according to a new report from the Department of Health and Human Services Office of Inspector General.

Government investigators warn that as more people fall into catastrophic coverage more quickly, Medicare costs will grow to unsustainable levels.

In 2015 the federal government’s catastrophic coverage payments exceeded $33 billion – triple what was paid just five years earlier.

Don and Lisa Gose, of Middletown, sit with two of their three dogs, Zorro and Max. The Gose’s worry how they will continue to pay for Lisa’s medication, one of the most expensive specialty drugs in the world, in the future. KATIE WEDELL/STAFF

After she was told to prepare for the worst, a Middletown woman was given new life by medicine that is so rare — and expensive — interns aren’t allowed to handle it.

Now, Lisa Gose and her husband, Don, have a new challenge: how to pay for it.

Tim Rau of Kettering looks over pharmacy receipts for insulin. He and other diabetics have been angered by rising insulin prices and a lack of transparency over the reasons. KATIE WEDELL/STAFF

Coupons, patient assistance programs and other drug discount offers have become a big part of the prescription market as consumers struggle to deal with rising costs for their medications.

But some in the health care industry question the overall impact of these programs, which critics say mask rising prices while employers and insurance providers still foot the bill.

Staff Writer
Staff work to fill prescriptions at Waynesville Pharmacy. KATIE WEDELL/STAFF

Patients often wonder why their prescription medication in the same dosage is one price at one big chain drug store, and a completely different price at the big chain across the street. 

Sometimes it’s even offered for free.

Tim Rau’s cost for a 90-day supply of the insulin Lantus went up nearly 60 percent in one year. KATIE WEDELL/STAFF

The three largest manufacturers of insulin are accused of conspiring in a price-fixing scheme, driving up the cost of lifesaving drugs for millions of patients, according to a lawsuit filed Monday.

The federal suit filed in Massachusetts accuses drug makers Sanofi, Novo Nordisk and Eli Lilly of raising the list prices of their products “in perfect lock step” for years.

Staff Writer
Abigail Martin holds her son Aston, 22-months, at their home in Miami Township. A medicine to treat Aston’s life-threatening seizures costs $180,000. KATIE WEDELL/STAFF

Abigail Martin is grateful for the life-saving drugs her 22-month-old son Aston takes for his epileptic seizures, but the listed price — $180,000 for an eight-week treatment — leaves the Miami Twp. mother shaking her head.

Fortunately for Martin, her insurance plan covered most of the cost, leaving her to pay the $5,000 deductible. But the drug industry has drawn ire for the high cost of specialty drugs like the one Aston takes — injectable H.P. Acthar Gel.

Staff Writer
Pharmacist Kyle Fields counts pills at Waynesville Pharmacy, Dec. 2, 2016. The Dayton Daily News has been digging into the complex system behind how prescription drugs get priced. KATIE WEDELL/STAFF

After digging into the complex system behind how prescription drugs get priced, here are three things we learned.

The world of drug pricing is shrouded in layers of complexity that often confound the principles of basic economics. For example, despite increased competition for the most common drugs on the market , prescription drug prices continue to rise faster than all other types of health care services, according to the Centers for Medicare and Medicaid Services.

We dig in to how it all works.

Kyle Fields, president of ApproRX, a Waynesville pharmacy benefit management company.

While high-profile stories of price increases for life-saving prescription medications have earned negative attention for pharmaceutical manufacturers, many in the public are unaware of the role played by a less visible piece in the drug supply chain — pharmacy benefit managers.

These companies say they save employers millions by using their collective buying power to negotiate rebates from drug makers. Critics of these middlemen say their opaque tactics are actually the driving force behind some of the price increases vexing consumers.

Here are five things most consumers don’t know about pharmacy benefit managers:

Staff Writer
In this Jan. 11, 2017 file photo, President-elect Donald Trump speaks during a news conference in the lobby of Trump Tower in New York. (AP Photo/Evan Vucci)

Reforming the drug industry has become a hot political topic with both sides of the aisle calling for changes.

Many Americans are demanding changes. In a September Kaiser Family Foundation poll, 82 percent of the respondents favored giving Medicare — the federal government’s insurance program for seniors — new authority to negotiate prices with drug companies. Seventy-eight percent supported limiting the amount companies can charge for high-cost drugs. And 86 percent said they want more transparency on how drug companies set prices.

Produced by Katie Wedell
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