Meanwhile, as the hospital scrambles to locate the drug, unscrupulous firms are inundating the facility with emails and faxes offering the hard-to-get chemotherapy drug at exorbitant prices. The hospital is left with an untenable choice. It can pay an outrageous amount of money, perhaps as much as several hundred times the customary price, or it can wait months for the normal supply chain to catch up with demand.
Confronted with those paradoxical options, many hospitals pay the extortionate markup to take care of their patients.
Unfortunately, this scene is being played out too often in hospitals and health care facilities across the country. This growing trend is documented in a newly issued federal report prepared by congressional staffs. Until now, not much was known about how the gray market companies acquired the drugs when hospitals were unable to obtain them.
The report is entitled, "Shining Light on the Gray Market: An Examination of Why Hospitals Are Forced To Pay Exorbitant Prices For Prescription Drugs Facing Critical Shortages." It was released July 25, but has attracted precious little news coverage in the mainstream media.
That's too bad because Americans need to know hospitals are being bilked out of millions of dollars by these so-called gray market companies which take advantage of regulatory loopholes to reap unconscionable profits.
The explosive report describes how individuals established fake pharmacies for the sole purpose of buying up drugs that were in short supply. Instead of dispensing the drugs to patients, these faux pharmacies peddled the drugs to wholesalers owned by the same individuals or their shell companies. The conniving businesses then sold the drugs with astronomical markups to desperate hospitals.
Using this and similar schemes, these gray market firms marked up some drug prices by as much as 3,000 to 4,000 percent over the conventional contract price. The price-gouging is not illegal, but a handful of companies have been shuttered for violating state licensing laws covering pharmacies and drug wholesalers.
Despite enforcement efforts, drug shortages are becoming more common. Nearly every hospital in the United States (99.5% to be exact) reported at least one serious drug shortage in 2011, often forcing delays in treatments or procedures. Drug shortages quadrupled between 2005 and 2011.
Many drug shortages can be traced to manufacturing problems. When drug makers decide to shut down facilities for quality issues, it interrupts the steady flow of drugs. However, unethical gray market firms exacerbate the problem by quickly snapping up all available supply, creating a crisis.
In many cases, the medications in short supply are administered for cancer treatment. Examples include drugs to treat colon, stomach, breast and pancreatic cancer. The list also includes supplies commonly used in hospital emergency rooms, such as anesthetics for surgery and electrolytes for intravenous feeding.
The price tag for the shortages is staggering and escalating. A 2011 report by the American Society of Health-System Pharmacists estimated insufficient supplies of drugs cost the nation's hospitals more than $400 million in a single year. Ultimately, these costs are passed on to insurers, businesses and patients.
The federal report on gray market drug firms is a wake-up call for states. Tougher enforcement is required to make certain pharmacies and drug wholesalers operate within the law. In some cases, stricter licensing requirements are needed to weed out unscrupulous operators.
Americans need to be assured hospitals and health care facilities have adequate supplies of drugs for treatment in medical emergencies. Life is too precious to allow the gray market practice to continue endangering lives and threatening medical treatment.
No comments:
Post a Comment