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Prescription for Drug Costs?

Aired January 23, 2003 - 13:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


KYRA PHILLIPS, CNN ANCHOR: Crossing the border for drugs. Prices are so high in the United States, Americans are going to Canada for cheaper prescription pills. Now, when you see what our neighbors to the north are paying, your blood pressure might go up. Here's a sample of prices selling drugs from Canada. For a 90-tablet supply of the cancer drug Tamoxifen, the price is $260 more in the U.S., nearly $200 more in the states for the cholesterol drug Zocor, and nearly $100 more for the arthritis drug Vioxx. And this week, the Supreme Court heard arguments about an experimental program which forces drug companies to lower prices for people there.
So, what if anything can be done to lower prices in the United States?

Joining us now from Washington to talk about this, Edward Coyle, who leads bus trips to Canada for seniors in search of cheaper drugs and Marjorie Powell, from PhRMA, a lobbying group that represents a number of drug companies.

Thank you both for being with me.

Marjorie, let's start with you, and talk about these drugs and why they are so expensive. It seems that drug companies are making such a large profit.

MARJORIE POWELL, PHARMACEUTICAL RESEARCH & MANUFACTURERS OF AMERICA: Drugs are more expensive -- in the United States than Canada, because the Canadian government imposes price controls on prescription drugs, and the result is that many drugs are simply not on the market in Canada.

Canadians wait much longer than we do to have access to the newest medications.

PHILLIPS: Edward, is that true? Let's talk about the drugs. I mean, does Canada have everything that these seniors need in the United States?

EDWARD COYLE, ALLIANCE FOR RETIRED AMERICANS: Well, as you mentioned, my organization, the Alliance for Retired Americans, sponsors bus trips to Canada, in which our own members from the northern-tier states, go into Canada constantly to buy these drugs. We run this as a service to our members, and actually do a lot of advance work for our members as they plan their trips into Canada, and we have never had a problem finding the same drugs in Canada that they get here in the United States. PHILLIPS: Edward, I've head these stories about the seniors that are on your bus trip. And some of them, half of their social security check every month goes toward prescriptions. They can't afford them. Are these stories you hear on a regular basis? Tell me about your seniors.

COYLE: We did -- over this past year -- a lot of our state organization run bus trips on their own. We set out in the spring of last year to try to organize a trip from every state that borders Canada into Canada during the same timeframe. We ran 17 buses, more than 400 people. And the 400 people who rode the buses into Canada during that period saved in excess of $500,000. The average amount saved was $1,340.

And I can tell you there were people that went into Canada with us who told me on the bus trip in that in fact they get up every morning, they look in their bathroom mirror, and they decide whether that's the day they have to start cutting their pills in half to last the rest of the month. There was a woman from Philadelphia I would mention she told me on the 24th of every month, she stops taking her pills because she doesn't have the enough to buy the pills that she needs until the next Social Security check arrives.

PHILLIPS: Marjorie, these stories are heart wrenching. Why can't seniors get the same drugs at a cheaper price right here in the United States?

POWELL: Kyra, the reason drugs are cheaper for those of us who are working is that we have somebody who is negotiating and purchasing drugs for us, and seniors don't pay for their hospitalizations, because that's covered by Medicare. The answer to the problem for seniors is a Medicare drug benefit. It's crazy that in this day and age where prescription drugs are such an important part of health care, that Medicare doesn't cover drugs for seniors. We've been urging members of Congress to pass a Medicare drug benefit for the last several years. And we frankly are hopeful that this is the year that they will pass a drug benefit.

The answer is not price controls, as the state of Maine has tried to do, particularly price controls that are using Medicaid patients, the sickest, poorest people in the state, as the hammer to force the price controls. The answer is to provide coverage through a Medicare drug benefit.

PHILLIPS: So, Marjorie, you're saying let's change Medicare and go ahead and let drug companies use lots of money -- I've been reading millions of dollars in advertising. Why not cut the budget there and make these drugs a little cheaper?

POWELL: In fact, Kyra, the majority of the drug companies marketing money is actually spent on providing samples that doctors can use so that a patient can try a drug to see if that particular drug will work, or if they'll have side effects that are not acceptable. The sampling is a central part of the health care system, and in many cases doctors use those samples for people who can't afford their drugs. But we think the real answer is to provide a Medicare drug benefit rather than just impose price controls.

PHILLIPS: Edward, is that the answer?

COYLE: Let me just say that, we would agree, I think, on the notion that we have to have a prescription drug benefit under Medicare as our position.

The position that PhRMA takes, and in fact, the only bill that was passed in Congress this last session took the position that it ought to be delivered by private insurers.

What Marjorie doesn't share with you is the notion that there's a difference between providing this benefit under Medicare and having it be provided by a private insurer, which is what they want to do, because then if you're older and wealthy, you have no problem, and you're healthy and wealthy, you have no problem getting a covered by insurance. If you're older, and poorer and, God forbid, not healthy, you're going to find yourself without any prescription drug coverage at all.

PHILLIPS: So, Marjorie, what do we do about the seniors that are in that low-income bracket?

POWELL: Well, I'd like to point out that all federal employees have health benefits through the private insurance industry, and the government doesn't tell them which drugs they can have and which drugs they can't have. We think using private insurance as a system for providing a Medicare drug benefit makes sense, because it doesn't have the government in the role of making the decision about which drugs an individual patient can have, which drugs the doctor can prescribe; where we think if there were a Medicare drug benefit, there would also be assistance for state Medicaid budgets, because Medicare would pick up some of the costs now covered by Medicaid.

We just -- we're urging members of Congress to work toward a Medicare drug benefit, and think that makes much more sense than a prescription drug program like Maine (ph).

PHILLIPS: Marjorie, let me throw something out, why not these drug companies that obviously make a lot of money, why not for the time being cut these seniors a break and get them the drugs they need so they don't have to go to Canada on these buses?

POWELL: Kyra, let me answer that, because we have a number of drug companies that have established drug discount cards for seniors as an interim until Congress does establish a drug benefit. I have a chart that has 800 numbers for five different cards. In addition, all of the PhRMA member companies have patient assistance programs.

COYLE: The bottom line here is how much people are paying for their drugs, and the programs that are mentioned here are fine programs, but the bottom line, is people are still paying way too much for their prescription drugs.

In the state of Maine, which was the subject of the Supreme Court case hearing the other day, PhRMA took them to court two years ago. There's a piece of legislation that passed the Maine legislature, Democratic controlled, signed into law by an independent governor, Angus King, and supported by the two Republican senators from Maine, Olympia Snowe and Susan Collins.

Susan Collins, by the way, received $70,000 from the pharmaceutical industry last year for re-election to the Senate. So PhRMA must feel awfully alone out there. They alone are fighting this bill, which was actually passed two years ago and, by everyone's estimate, would be saving up to 25 percent on Maine residents prescription drug costs, if it had bee in effect the last two years.

We have run five buses into Canada the last two years out of Maine because people can't afford to buy their drugs in Maine, and PhRMA is standing in the way of that.

PHILLIPS: I just -- Marjorie, final thoughts. We've got to go, but Edward does make a point about the millions of dollars funneled to politicians that support PhRMA. I want you to be able to respond to that before we go, please.

POWELL: Kyra, the reason that we're suing the state of Maine is they're going to prevent Medicare patients, the sickest, poorest people in the state, from getting their prescription drugs in order to impose price controls on the drug companies. We think that that's just inappropriate health care for Medicaid patients, that the state didn't need to do that. They had a senior pharmacy assistance program that all of the PhRMA member companies were participating in that provided a discount to seniors in the state.

COYLE: It would be inappropriate, but it's all inaccurate.

PHILLIPS: All right, I'm going to have you both come back, because the State of the Union address is supposed to address this issue. I want you both to come back. We'll continue this conversation. Lot of issues at hand.

Edward Coyle, Alliance Retired Americans, Marjorie Powell, with PhRMA, thank you both very much.

POWELL: We'd love to come back. Thank you.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com







Aired January 23, 2003 - 13:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Crossing the border for drugs. Prices are so high in the United States, Americans are going to Canada for cheaper prescription pills. Now, when you see what our neighbors to the north are paying, your blood pressure might go up. Here's a sample of prices selling drugs from Canada. For a 90-tablet supply of the cancer drug Tamoxifen, the price is $260 more in the U.S., nearly $200 more in the states for the cholesterol drug Zocor, and nearly $100 more for the arthritis drug Vioxx. And this week, the Supreme Court heard arguments about an experimental program which forces drug companies to lower prices for people there.
So, what if anything can be done to lower prices in the United States?

Joining us now from Washington to talk about this, Edward Coyle, who leads bus trips to Canada for seniors in search of cheaper drugs and Marjorie Powell, from PhRMA, a lobbying group that represents a number of drug companies.

Thank you both for being with me.

Marjorie, let's start with you, and talk about these drugs and why they are so expensive. It seems that drug companies are making such a large profit.

MARJORIE POWELL, PHARMACEUTICAL RESEARCH & MANUFACTURERS OF AMERICA: Drugs are more expensive -- in the United States than Canada, because the Canadian government imposes price controls on prescription drugs, and the result is that many drugs are simply not on the market in Canada.

Canadians wait much longer than we do to have access to the newest medications.

PHILLIPS: Edward, is that true? Let's talk about the drugs. I mean, does Canada have everything that these seniors need in the United States?

EDWARD COYLE, ALLIANCE FOR RETIRED AMERICANS: Well, as you mentioned, my organization, the Alliance for Retired Americans, sponsors bus trips to Canada, in which our own members from the northern-tier states, go into Canada constantly to buy these drugs. We run this as a service to our members, and actually do a lot of advance work for our members as they plan their trips into Canada, and we have never had a problem finding the same drugs in Canada that they get here in the United States. PHILLIPS: Edward, I've head these stories about the seniors that are on your bus trip. And some of them, half of their social security check every month goes toward prescriptions. They can't afford them. Are these stories you hear on a regular basis? Tell me about your seniors.

COYLE: We did -- over this past year -- a lot of our state organization run bus trips on their own. We set out in the spring of last year to try to organize a trip from every state that borders Canada into Canada during the same timeframe. We ran 17 buses, more than 400 people. And the 400 people who rode the buses into Canada during that period saved in excess of $500,000. The average amount saved was $1,340.

And I can tell you there were people that went into Canada with us who told me on the bus trip in that in fact they get up every morning, they look in their bathroom mirror, and they decide whether that's the day they have to start cutting their pills in half to last the rest of the month. There was a woman from Philadelphia I would mention she told me on the 24th of every month, she stops taking her pills because she doesn't have the enough to buy the pills that she needs until the next Social Security check arrives.

PHILLIPS: Marjorie, these stories are heart wrenching. Why can't seniors get the same drugs at a cheaper price right here in the United States?

POWELL: Kyra, the reason drugs are cheaper for those of us who are working is that we have somebody who is negotiating and purchasing drugs for us, and seniors don't pay for their hospitalizations, because that's covered by Medicare. The answer to the problem for seniors is a Medicare drug benefit. It's crazy that in this day and age where prescription drugs are such an important part of health care, that Medicare doesn't cover drugs for seniors. We've been urging members of Congress to pass a Medicare drug benefit for the last several years. And we frankly are hopeful that this is the year that they will pass a drug benefit.

The answer is not price controls, as the state of Maine has tried to do, particularly price controls that are using Medicaid patients, the sickest, poorest people in the state, as the hammer to force the price controls. The answer is to provide coverage through a Medicare drug benefit.

PHILLIPS: So, Marjorie, you're saying let's change Medicare and go ahead and let drug companies use lots of money -- I've been reading millions of dollars in advertising. Why not cut the budget there and make these drugs a little cheaper?

POWELL: In fact, Kyra, the majority of the drug companies marketing money is actually spent on providing samples that doctors can use so that a patient can try a drug to see if that particular drug will work, or if they'll have side effects that are not acceptable. The sampling is a central part of the health care system, and in many cases doctors use those samples for people who can't afford their drugs. But we think the real answer is to provide a Medicare drug benefit rather than just impose price controls.

PHILLIPS: Edward, is that the answer?

COYLE: Let me just say that, we would agree, I think, on the notion that we have to have a prescription drug benefit under Medicare as our position.

The position that PhRMA takes, and in fact, the only bill that was passed in Congress this last session took the position that it ought to be delivered by private insurers.

What Marjorie doesn't share with you is the notion that there's a difference between providing this benefit under Medicare and having it be provided by a private insurer, which is what they want to do, because then if you're older and wealthy, you have no problem, and you're healthy and wealthy, you have no problem getting a covered by insurance. If you're older, and poorer and, God forbid, not healthy, you're going to find yourself without any prescription drug coverage at all.

PHILLIPS: So, Marjorie, what do we do about the seniors that are in that low-income bracket?

POWELL: Well, I'd like to point out that all federal employees have health benefits through the private insurance industry, and the government doesn't tell them which drugs they can have and which drugs they can't have. We think using private insurance as a system for providing a Medicare drug benefit makes sense, because it doesn't have the government in the role of making the decision about which drugs an individual patient can have, which drugs the doctor can prescribe; where we think if there were a Medicare drug benefit, there would also be assistance for state Medicaid budgets, because Medicare would pick up some of the costs now covered by Medicaid.

We just -- we're urging members of Congress to work toward a Medicare drug benefit, and think that makes much more sense than a prescription drug program like Maine (ph).

PHILLIPS: Marjorie, let me throw something out, why not these drug companies that obviously make a lot of money, why not for the time being cut these seniors a break and get them the drugs they need so they don't have to go to Canada on these buses?

POWELL: Kyra, let me answer that, because we have a number of drug companies that have established drug discount cards for seniors as an interim until Congress does establish a drug benefit. I have a chart that has 800 numbers for five different cards. In addition, all of the PhRMA member companies have patient assistance programs.

COYLE: The bottom line here is how much people are paying for their drugs, and the programs that are mentioned here are fine programs, but the bottom line, is people are still paying way too much for their prescription drugs.

In the state of Maine, which was the subject of the Supreme Court case hearing the other day, PhRMA took them to court two years ago. There's a piece of legislation that passed the Maine legislature, Democratic controlled, signed into law by an independent governor, Angus King, and supported by the two Republican senators from Maine, Olympia Snowe and Susan Collins.

Susan Collins, by the way, received $70,000 from the pharmaceutical industry last year for re-election to the Senate. So PhRMA must feel awfully alone out there. They alone are fighting this bill, which was actually passed two years ago and, by everyone's estimate, would be saving up to 25 percent on Maine residents prescription drug costs, if it had bee in effect the last two years.

We have run five buses into Canada the last two years out of Maine because people can't afford to buy their drugs in Maine, and PhRMA is standing in the way of that.

PHILLIPS: I just -- Marjorie, final thoughts. We've got to go, but Edward does make a point about the millions of dollars funneled to politicians that support PhRMA. I want you to be able to respond to that before we go, please.

POWELL: Kyra, the reason that we're suing the state of Maine is they're going to prevent Medicare patients, the sickest, poorest people in the state, from getting their prescription drugs in order to impose price controls on the drug companies. We think that that's just inappropriate health care for Medicaid patients, that the state didn't need to do that. They had a senior pharmacy assistance program that all of the PhRMA member companies were participating in that provided a discount to seniors in the state.

COYLE: It would be inappropriate, but it's all inaccurate.

PHILLIPS: All right, I'm going to have you both come back, because the State of the Union address is supposed to address this issue. I want you both to come back. We'll continue this conversation. Lot of issues at hand.

Edward Coyle, Alliance Retired Americans, Marjorie Powell, with PhRMA, thank you both very much.

POWELL: We'd love to come back. Thank you.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com