Roosevelt Institute | Cornell University

The Double-Edged Sword of Prescription Drugs in the U.S

By Daniel HuynhPublished November 2, 2017

Current prescription drugs in the U.S have allowed medical professionals to treat patients more efficiently. However, with the current skyrocketing costs of Rx drugs, many patients are left with the tough decision of choosing to empty their wallets or to suffer with their conditions.

Hepatitis C is a debilitating viral infection that can cause liver failure. What's more debilitating is the medical bill patients face when they receive treatment. Failure to treat Hepatitis C can cause chronic symptoms and eventually lead to liver failure. It is estimated that around 3.5 million Americans are currently affected by this disease.
Technology has allowed the invention of drugs such as Harvoni to cure up to 90-95% of patients. This amazing drug costs $1,125 per a pill or $94,500 for a 12-week course of treatment. Patients must decide whether they can afford a treatment that can potentially cure them of this disease or face a jaw-dropping medical bill.
Although insurance does provide some coverage for prescription drug costs, not all insurances policies cover all drugs. Depending on the provider and plan in which patients are enrolled their insurance will only cover a portion of the drug cost. Another large issue is that not all patients who need treatment have insurance. The high cost of the Harvoni drug may actually hinder patient access to a life-saving drug.
A large question is "Why do prescription Drugs in the U.S cost so much?".  There are two reasons. One reason is that the U.S government doesn't participate in negotiating prices with pharmaceutical companies when drug contracts are being formed between insurance companies and the pharmaceutical companies. Another reason is that pharmaceutical companies have a 10-year patent protecting their product against competition. In these 10 years, pharmaceutical companies have the power to monopolize drug prices and raise them much higher for profit. It is only after 10 years when the patent expires that other companies can develop and sell these drugs under a generic brand at much lower costs.
In 2013, the U.S spent about $858 per capita compared to the average of $400 for 19 other industrialized countries. This excessive spending on prescription drugs seems to be burning holes in the wallets of many patients, yet it seems like lowering the prescription price isn't an option. It is possible that increased government involvement in Rx drug pricing can actually be a disincentive for many companies from developing many new drugs. There is much debate about whether lowering drug Rx prices would actually affect the research and development of new drugs. According to statistics, pharmaceutical companies spend much more money marketing drugs than research and development.
Whether increasing government intervention to reduce drug prescription prices or decreasing prices to promote competition amongst companies, the most important issue at stake is improving access to these drugs for all groups of people who need them.