A Tale of a Drug and What it Means

Dear Group,

The chemical 5-fluorouracil (5-FU) was patented originally in 1956. It came into medical use only six years later in 1962. As a drug It interferes with DNA production, fouling up the machinery necessary for rapidly growing cells to divide and multiply. 5-FU is used in the treatment of systemic cancers, including cancer of the breast, ovary, and colon. It is NOT a fancy new drug requiring expensive research and development. 

Some of my readers may have used this drug as a topical treatment for the precursors of skin cancer. As a topical 5% cream 5-FU is remarkably safe and effective, and, until recently, was quite inexpensive. Never heard of 5-FU, you say? How about the trade names Efudex, Carac, or Fluoroplex? 

I visited my dermatologist recently and received a prescription for Efudex Cream 5% to “Apply to Scalp BID [twice a day] until red, raw, irritated.” Along with the prescription came some non-medical advice. “Your price point is around fifty dollars,” she said. 

“Fifty dollars!” I exclaimed.

“Oh, yes,” she said. “A while ago patients started calling me back to say they couldn’t afford the Efudex I’d prescribed. Some of them told me of charges up to $300 for a 40 gram tube. Now I spend a portion of every day explaining how to avoid paying ridiculous prices for a drug that used to be cheap. If I don’t spend the time explaining, some of my patients will simply skip the treatment and show up later with invasive skin cancer requiring major surgery.” 

I was stunned. This is a drug I heard about in medical school in the early 1980s. The last time I bought a 40 gram tube of Efudex (5-FU), maybe ten years ago, it was about twenty dollars.

Forewarned, I called my usual pharmacy to ask what it would cost me to fill the prescription.. “Your net cost after insurance will be $100,” I was told. 

“After insurance?” I asked. “What would it cost me if I bought it outright?”

“Two hundred and eighty-four dollars.” she said. I wanted to scream…but it wasn’t her fault. She’s caught in the same un-free market that I am.

Let’s think about this a minute. I could hand over my credit card and accept the $100 cost. If I weren’t a physician myself and if my dermatologist hadn’t prepared me, I probably would have just grumbled and paid, just like a lot of busy people. But what are the consequences to the whole cost of medical care in an un-free market like ours?

I don’t know how much of the quoted $284 goes to the pharmacy, how much to the drug company and how much to the stockholders, but I can guarantee we feel the economic effect in our health insurance bills. Consider: as this scenario is repeated across all the subscribers to my health insurance, the insurance company has to ramp up the premium by some amount to cover the payment to the pharmacy. Insurance, you recall, serves to smooth out unexpected cost over all the subscribers. As long as their money-making business model is not threatened, insurance executives have little reason to try to micromanage ridiculously inflationary drug costs. Why should they bother? Just pass through the average extra cost to the whole pool of subscribers. The drug company and the insurance company both make a profit and the subscriber is none the wiser.

While the patient/consumer understandably complains about the ever rising cost of insurance, McMorris Rodgers and her Republican/Libertarian colleagues blame the Democrats and the Affordable Care Act, intoning “free market,” “personal choice,” and the evils of “government intrusion” into our personal lives. 

A free market requires symmetry of information for supply and demand to establish the proper price for an item, but in the drug and insurance world the corporations have a massive advantages they wield in their pursuit of profit. First, the patient/consumer often feels as though there is no choice about whether or not to buy the drug. To add to the asymmetry, pharmaceuticals are marketed under multiple brand names, a generic name, and multiple sizes and formulations. Sorting out the history, side-effects and efficacy of any given drug can be a time-consuming task. The doctor prescribing the drug and the pharmacist filing the prescription have dozens of other things they should be spending their time on besides trying to make the patient/consumer aware of the price structure for every medicine. 

How much time is there in a life for every patient/consumer to dig around the way I did with 5-FU to figure out the least expensive method of obtaining a drug? “It’s my health! The doctor prescribed it. I must buy it, if I can’t come up with that kind of money, well, I’ll just have to make do without it.” Life goes on…until a vastly more expensive and dangerous surgical procedure might be required to treat the disease easily dealt with by the original prescription.

The ridiculously inflated price of 5-FU has another unintended effect: For a caring doctor trying to provide treatment for pre-cancer that a patient can afford there is another option, an in office light treatment that is often fully covered by health insurance. Never mind it is not quite as effective and never mind it requires repetitive monthly $200 visits. But, voila! the patient/consumers out of pocket cost (the $100 I was quoted for a tube of Efudex) might be less or nothing. Never mind the overall accumulated cost to the health care system is more…

Run this economic scenario through your head again and again with different drugs and different patients and you will have a hint of how broken our system is, why it is so ridiculously expensive, and why we, as a country, have worse health outcomes and pay more for health care than much of the developed world.

Meanwhile, McMorris Rodgers’ solution to the problem? Here’s her full statement from her essay published September 30 in the Spokesman:

I also believe we need to address skyrocketing prescription drug prices. I’ve led on legislation to bring transparency to Pharmacy Benefit Managers (PBMs) who are the middlemen between drug companies and local pharmacists and are often the source of pricing increases. Just this week, I supported legislation to ban gag clauses – contractual provisions that bar pharmacists from informing patients when it’s cheaper for them to pay out-of-pocket for their prescriptions than go through their insurance. If our pharmacists, health insurers and PBMs can know the real cost of prescriptions, so should our patients.

What?? We’re going to control drug prices in a hopelessly rigged and complex market by empowering (not mandating) middlemen to tell patients about drug prices? This is going to result in cost reduction? Even if she grasps some part of the problem of the lop-sided un-free market, this is barely the beginning of a solution.

In contrast, Lisa Brown wrote in her essay of the same day:

I will work to lower the cost of prescription drugs – the federal government can and should use its buying power to negotiate lower costs.

That comment suggesting government intervention is unthinkable to a doctrinaire “free” market Republican/Libertarian like our incumbent. McMorris Rodgers offers to tinker with an un-free market problem that is beyond tinkering. Have her pharmaceutical sponsors convinced her that to have huge government volume buyers like Medicare use their bargaining power in the marketplace would be unfair to them and their stockholders? 

By the way, that $284 tube of 40 grams of 5% Efudex for my scalp? I’m getting it through a Canadian pharmacy for $51.58 USD. I took time out of my life and I had the resources to play the game. Not everyone has that time and resources–nor should they be expected to. It should be a function of government to guard our health care system from profit driven predation in an un-free market.

Read Lisa Brown’s whole essay here. It is a breath of fresh air and comprehension. Lisa gets it.

Keep to the high ground,