Politics

Lesson of EpiPen Scandal: Government Is Not Your Friend

Flawed federal programs and regulatory failures allow and encourage drug-price gouging

President Ronald Reagan’s warning to beware of anyone who says, “I’m from the government, and I’m here to help,” is extremely applicable to the latest EpiPen scandals — and the whole problem of drug prices.

Americans pay four to 10 times more for prescription drugs than what citizens of other developed countries pay. It’s true that drug prices must be high enough to pay for research and development, but there is no reason that only American consumers should bear that cost. We effectively subsidize the generous national health systems of Canada and other western countries by allowing them to get away with paying much lower prices that don’t reflect the much greater R&D costs of the drugs they use.

In short, not only do western countries, like the NATO alliance, not pay their fair share of their own defense costs, but they don’t even pay their own health care costs. That cost is paid for indirectly by the U.S. government through Medicare and Medicaid as well as the American consumer and their employers.

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But discriminatory pricing is not the only problem — fraud may also be a big part of the picture. And the government may have its own part in allowing that fraud to continue.

On May 31, Sen. Chuck Grassley (R-Iowa), chairman of the Judiciary Committee, received an estimate from the Department of Health and Human Services Inspector General that taxpayers may have overpaid for EpiPen by as much as $1.27 billion from 2006 through 2016, far more than the $465 million that the company reported it had agreed to in settlement negotiations with the Justice Department. Grassley has pressed EpiPen maker Mylan and the Centers for Medicare and Medicaid Services (CMS) for documentation and answers on why EpiPen was misclassified under the Medicaid Drug Rebate Program, resulting in huge overcharges to the states and taxpayers.

Grassley has pressed for months for a complete accounting of the overcharges and sought records of communications between CMS and Mylan about the misclassification. Recently, CMS provided records to the Committee that show CMS told Mylan on several occasions that the EpiPen was misclassified, yet Mylan failed to correct the classification.

Mylan has repeatedly refused to provide its records of those communications with CMS to the committee and now seeks a private meeting with Grassley while avoiding public comment.

Per Grassley, “It looks like Mylan overcharged the taxpayers for years with the knowledge EpiPen was misclassified, and the previous administration was willing to let the company off the hook.” But the Obama administration isn’t the first administration to not vigorously advocate for Americans when it comes to drug prices. President George W. Bush before him also turned a blind eye.

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What has been Mylan’s response? When concerns of price gouging were raised internally, Mylan’s chairman was far from distressed, according to The New York Times in a June 4 article. “Mr. Coury replied that he was untroubled. He raised both his middle fingers and explained, using colorful language, that anyone criticizing Mylan, including its employees, ought to go copulate with themselves. Critics in Congress and on Wall Street, he said, should do the same. And regulators at the FDA? They too deserved a round of anatomically challenged self-fulfillment.”

Perhaps the arrogance of Mylan’s Coury only reflects the fact that he thinks or knows he has the government regulators in his pocket.

This once again proves that government regulation of health care is the problem, not the solution. We need transparent markets with an end to the discriminatory pricing that hurts American taxpayers. This corruption works to the advantage of politicians and regulators who live off the scraps of political contributions and cushy jobs provided as a virtual bribe, in my opinion, by the pharmaceutical industry.

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President Trump must do what his predecessors in office and Congress have failed to do. He must use 15 USC chapter 1 and have the DOJ enforce these 100-year-old statutes to criminally prosecute the executives of the pharmaceutical industry if they charge Americans exponentially more than what our western allies and Canadian neighbors pay. He doesn’t need an act of Congress to do that.

If the ruinous civil fines don’t change their behavior, perhaps seeing their peers do the perp walk in handcuffs will.

Mylan’s actions and our government’s inaction show that two issues exist. Not only is current law not enforced, but we can’t trust the federal government to follow its own rules.

And don’t forget, with “single payer,” where there is no competition against a corrupt government, our situation would be even worse. That truly would be putting the fox in charge of the henhouse.

Dr. Ramin Oskoui, a cardiologist in the Washington, D.C., area, is CEO of Foxhall Cardiology PC and a senior health care adviser to LifeZette.

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