Steve May: Mylan story is just tip of the iceberg

Editor’s note: This commentary is by Steve May, of Richmond, who is a Progressive candidate for the Chittenden-1/Richmond seat in the Vermont House. May also founded a nonprofit called the Forum on Genetic Equity addressing genetic discrimination and served as former national director of state affairs for the Hemophilia Federation of America. May currently is a licensed independent clinical social worker with a private practice in Burlington.

[H]ow much is enough?

The recent controversy about the EpiPen and its costs raises deep and disturbing questions for Vermonters. Mylan, a drug manufacturer with a heavy presence in Vermont, appears to have been gouging the public; its premiere product has spiked in cost, going up over 500 percent in just over five years. EpiPen relies on a chemical compound, epinephrine, which is commonly available and has been for well more than a decade. By any objective measure this is grotesque, the worst kind of price gouging at the expense of a public held captive.

Manufacturing prescription drugs is costly. There are stranded costs, which are part of doing business as a drug manufacturer. No reasonable person doubts any of this to be true. But attempting to settle the balance on the backs of the most vulnerable consumers is frankly indecent.

In recent days we have learned of obscene compensation packages for company executives along with the sky-high profiteering which has created a crisis for members of the public. While the outrage is real amongst the public, little has been done to assure that this not happen again. Let’s be clear. This need not happen again.

Vermont is precluded by federal law from using Medicaid and Medicare purchasing to achieve cost savings in pharmacy products. That is to say, the largest state health purchasing programs for prescription drugs may not be used to achieve savings in the acquisition of meds. Vermont does not only use Medicare and Medicaid. The State of Vermont should expand use of a purchasing pool to drive down the cost of acquiring prescription meds.

Care must be taken to assure that vulnerable people are not harmed by the very drugs which are intended to improve the lives of these patients and by extension their families, and other loved ones.


So much attention in recent years has been spent on how to deliver a cheaper and more efficient health care benefit to Vermonters. Pharmacy costs have been largely overlooked. Fights over single-payer, broken exchanges and “The ACA, Obama-Care, Romney-Care, I don’t care” … all have been central to the ongoing fight over health care access. They have been central on a national level, and central to our politics here on the state level, with the Lewin report and Gov. Peter Shumlin’s single-payer November betrayal.

Maybe there are sexier policy issues, but be clear; Mylan has a significant footprint in Vermont, with locations in both St. Albans and Essex. This Mylan episode is very much a made-in-Vermont story and it demands that we not lose track of the toll pharma plays in our daily lives. Devices and prescriptions are huge drivers in the cost of administering health care.

The Mylan story sadly is only the tip of the iceberg. Lest we forget the boldness with which disgraced former Turing Pharmaceuticals CEO Martin Shkreli (aka Pharma-Dude) moved to inflate the cost of a generic drug for an orphan disease. Shkreli, also known as the most hated man in America, is best known for massive price gouging around medical therapies for chronic disease states. The strategy repeated multiple times called for the identification of therapies which had come off-patent, which could be bought by any manufacturer, but were bought by Shkreli and his associates with the idea of manipulating prices, creating scarcity where a desperate pocket of patients had no choice but to pay the skyrocketing cost or jeopardize their health.

Shkreli first did this with a prescription med called Thiola. Shkreli executed a plan where his company bought the licensing rights to off-patent generic drugs, and then manufactured scarcity by either reformulating the med or playing havoc with supply and demand. Thiola (the drug in question) is used to treat the rare kidney condition cystinuria.

Rare diseases are often especially expensive to treat. In many cases, the treatment itself is not something that can be used for other health conditions and, as such, is extremely expensive to produce. Not so in this case, an average course of treatment, according to experts, for an average patient addressing cystinuria would involve taking 10-15 pills per day. Under Shkreli, the per pill cost of Thiola went up 500 percent. This would ultimately set the stage for Shkreli to purchase another off formulary med, Daraprim. Daraprim is critical to the care of HIV and some cancer patients. Shkreli’s company bought Daraprim and then raised the per pill cost by a factor of 5,000 percent. There was and is no similar type treatment for Daraprim users. These patients effectively were held hostage by corporate greed on steroids and the wild machinations of the business cycle.

A special formulary must be created to protect patients with rare and chronic conditions from price gouging. Care must be taken to assure that vulnerable people are not harmed by the very drugs that are intended to improve the lives of these patients and by extension their families, and other loved ones. It is beyond peculiar to engage in the practice of saving lives through groundbreaking medical research on one hand, only to turn the very people whom you serve through your research into captives through a combination of circumstance and biology. Patient needs must be on par with shareholder profits as a matter of public policy in these cases.

The patients with the rarest of medical conditions deserve access to adequate care. When there is no similar therapy available, the state has an abiding interest to protect Vermonters from wild gyrations in the supply of life-sustaining therapies. Further, when the therapy in question is no longer on patent, the state should act to assure routine access. This is a logical extension of generic-first prescribing, a practice which has been supported in Vermont for more than a decade. When the brand name drug is medically necessary physicians are able to ensure access, but when generics are a prudent, cost-effective substitution, substitution occurs seamlessly.

The Mylan-EpiPen issue is simply the latest episode in a sector of the economy removed from the normal rigors of the economic cycle. Daraprim and EpiPen are simply the latest in a long list of med manipulations. Corporate greed and largess cannot be tolerated when these corporations are acting as guardians of well-being for the majority of us. Drug manufacturers are not just like every other large multinational corporation and can’t be treated as such, as a matter of course. With one in two Americans relying on some kind of prescription drug daily, according to the Pharmaceutical Research and Manufacturers of America, and the continued graying of both Vermont and the nation the numbers are destined to rise. To this end, the creation of a special formulary for prescription meds which are specifically tied to rare and chronic conditions represents a prudent safety valve against price gouging the most vulnerable Vermonters.


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