Unbridled Greed

Unbridled Greed

By

Leonard Zwelling

http://www.c-span.org/video/?404183-1/hearing-prescription-drug-market

         I have labored through many hearings on Capitol Hill.  Most of the time they are of little
consequence and even less drama. The Congressmen and Congresswomen make
speeches. The “witnesses” are under oath and bob and weave trying to say
nothing and hoping the chairman says the member’s 5 minutes has run out.
Nothing gets decided and nothing gets learned most of the time. Lot’s of
hearing but no listening. But, not today, Thursday, February 4, 2016.

         The House Oversight and Government Reform Committee held hearings
about the price of prescription drugs. The link is above and I understand it is
4 hours of video, but it is far more illuminating than most and surely more
than the latest you tube garbage of piano-playing cats.

         Committee chair Jason Chaffetz and Ranking Member Elijah
Cummings led the committee through a detailed and heated interrogation of five
witnesses, but one was the key to it all.

         Michael Shkreli, the young, recently indicted former CEO of
Turing Pharmaceuticals refused to answer any questions, invoking his 5th
Amendment rights against self-incrimination regardless of the question he was
asked beyond his name and the fact that he had appeared on television in the
past to answer questions. The members on both sides of the aisle were furious.
They dismissed the young ex-executive and brought the wrath of the House down
on the other witnesses, particularly Mr. Shkreli’s former COO named Retzlaff
and the CEO of a very large company called Valeant a Mr. Schiller who admitted
to making $27 million last year while he jacked up the prices of vital drugs
like Isuprel and Nipride.

         Two big issues were on the table.

         First, the outrageous profits being made by American
pharmaceutical companies on the backs of the American taxpayer, both insured
and un-, simply because the companies can.

Second,
one of the reasons they can is the FDA is so backed up trying to approve generic
drugs to compete with what is already on the market, that these manufacturers
of drugs that are either single source or for rare diseases have open season on
gouging the payers, the patients, and the hospitals.

Mr.
Shkreli is just a spoiled child who tweeted after the hearing that the Congress
members are “idiots.” Hmm. That will surely endear him to the US attorney of
whatever jurisdiction he finds himself in shortly for wholly unrelated misdeeds.
This young man sat there in front of Congress and refused to answer questions
all the while smirking at the lawmakers. These House members are capable of
doing him real harm. My guess is that they all went back to their offices and huddled with their staffs to
figure out how. Nonetheless, in the case of the Turing drug price gouging, it
is not at all clear that Mr. Shkreli did anything illegal.

Janet
Woodcock and Keith Flanagan (a fellow Health, Education, Labor and Pensions staffer
from my Capitol Hill days who now works for the FDA) acquitted themselves well.
They basically told the members that given the number of applications they
have, the rate at which the applications for approval are increasing, and the
lack of a commensurate increase in their staff or congressionally-allotted budgets,
they are doing all that they can to get competing generics out to the
marketplace. If Congress really wants competition, they ought to consider fully
funding the FDA to get them off the largesse of the very industry that they are
regulating via the users’ fees paid by pharma to keep the FDA afloat. (That’s
right. The agency approving most of the consumer goods Americans ingest is not
fully funded by your tax dollars, but instead gets boosted by the very industry
it regulates.)

The
members did their usual great job of elucidating an obvious problem, some of
which is of their own making (it is they who do not fully fund the FDA), and
then offering no real solutions other than to yell at the witnesses. If only
the witness’s mothers had done the same years ago.

The
problem of prescription drug pricing in the US is a real one and will never be
controlled unless and until a new system of care delivery, care provision and
pharmaceutical and device regulation is installed that makes health care a
right and shrinks the market-based forces that allow this nonsense to go on.
This is unbridled greed at its worst.

The
regulators need far more help and far more money, especially if the drug makers
can continue to compete in a gamed system of no competition.

It’s
worth watching this video, but don’t be surprised if you are depressed at the
end. The greedy are still greedy. The scolds are still scolds. And the adults
in the room are hard to find. I saw two—Dr. Woodcock and Mr. Flanagan. The rest
just wanted to get back to either making money or raising it.