KEY TAKEAWAY: The stock price of Eli Lilly dropped suddenly on Tuesday after Sen. Bernie Sanders criticized the rising price of the company’s insulin drug Humalog on Twitter. Drug companies are going to hear a lot more about drug pricing which in turn is going to put pressure on everything pharma does.
According to Sen Sanders: Last year, nearly one in five Americans between the ages of 19 and 64 – 35 million people – did not get their prescriptions filled because they did not have enough money. In the wealthiest country in the history of the world, Americans should not have to live in fear that they will go bankrupt or die because they cannot afford to take the medication they need.
In any given month, more than half of all American adults take at least one prescription drug. There is no question that medicines help millions of people live healthier and longer lives, and can also prevent more expensive illnesses and treatments. However, it is unacceptable that the United States now spends more than $370 billion on prescription drugs and spending is rising faster than at any point in the last decade.
Ouch! If the drug industry believes it can continue to spend money to lobby Congress and suppress drug cost issues, like the one in California, it is sadly mistaken. There are too many eyes on big pharma and the strategy of annual price increases is not going to work much longer.
Cuts are coming
So what happens when pharma sees a threat to their business model? They start cutting everything from expenses (DTC) to people (layoffs). Make no mistake the cuts are going to come like the ripple in the water after you throw in a rock.
If this election has taught us anything, it’s that voters are angry and they want payback. Drug companies represent a good target with their high drug prices and CEO’s who make millions of dollars. PhRMA is spending over $100 million to defeat drug pricing controls at the state and Federal level. Some brave CEO’s have come forward and said that “the model of high drug prices is unsustainable” but unfortunately that call is falling on deaf ears.