Want Cheaper Drugs?

U.S. drug pricing is in the crosshair s. Martin Shkreli, formerly of Turing pharmaceuticals and KaloBios, made headlines last fall after he hiked the price for the 1950s-er a drug Daraprim (pyrimethamine) nearly 5,500 percent. Throw in some super sized price increases by Valeant pharmaceuticals, condemnations by presidential candidates Hillary Clinton, Bernie Sander s, and Donald Trump, Wall Street Journal articles about high American drug prices, U.S. Senate and House committee hearings on drug pricing, and a comprehensive report on government spending on prescription drugs that is being prepared by the U.S. Department of Health and Human Services, and we have one pharmaceutical industry–sized black eye. Every imaginable product and service has a price, and yet there is some thing different about pricing prescription medicines. The unique characteristics of this industry should be under stood, lest politicians—eager to be seen addressing a “crisis”—severely damage an industry that has restored health and eased pain for hundreds of millions of Americans. To “fix” drug pricing, we need more competition, more cost sharing, and the liberalization of some regulations.

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