Congress decries drug price-gouging
Congress raked some specialty pharma companies over the coals on Friday, accusing them of gouging patients with "staggeringly high prices." In a hearing, the Joint Economic Committee targeted companies that had bought orphan drugs--the only available treatments for rare conditions--from larger drugmakers and then proceeded to raise their prices. For instance, Ovation Pharmaceuticals was said to have boosted the price of Indocin, a drug used to treat a condition that interferes with breathing in newborn and premature infants, to $1,500 per unit from $108 soon after buying the product from Merck.
And according to testimony, Indocin wasn't the only drug Ovation marked up so substantially. It bought three other Merck meds--Cosmegen, Diuril Sodium, and Mustargen--and boosted those prices by 3,437 percent, 864 percent, and 979 percent, respectively. Nor was Ovation the only culprit, the committee said; members cited Questcor Pharmaceuticals as another that raised prices on an orphan drug. In fact, a researcher said that she had found more than 100 single-source drugs at least doubled in price, with some increases amounting to more than 10,000 percent. That kind of sticker shock “look[s] uncomfortably like an abuse of the pricing power we give to drug companies,” said Sen. Charles Schumer, who chairs the committee.
What's next? Congress asked the Federal Trade Commission and the General Accountability Office to investigate.