Hey, weeds listeners that this is Eric laughed, but this is not the weeds. This is a break, and new podcast. This is our the opposite, we're still figuring out if we're going to do a first season, and it is so new that we do not have a name for this podcast. So I have two requests of you and they both involve sending an email to weeds at box dot com first, Wants you to send us your suggested names. We are desperate for some good name ideas, because all of ours are terrible and second you to send us feedback on this episode, which you liked about it. When you didn't like topics, you'd want us to cover if we do a full season, if you want to hear full season of this I guess please send an email, and let us know that so that I will let you get to listening. Listening and happy things happening. Laura Marston Apartment is pretty average for thirty four year old living in DC. The rooms are

pretty small and she's got these two pet cats running around and at first glance, her fridge. it seems pretty normal till I mean there's Brad, there's eggs, There's, like so does, and Protein Jake's, then it opens up the vegetable crisper and it's got all these plastic bags full of white proscription boxes. Two four: six: eight Earnshaw thirteen rows of insolence licorice rise. Like thirty thousand, isn't far off. Each vile holds less than a tablespoon of insulin, but its retail price is around two hundred and fifty dollars which is obviously really really expensive, especially given that it didn't used to be this ban a violence, just twenty dollars. When Laura was first diagnosed and ninety ninety six the same drug, the same packaging, but now it's ten times more expensive,

and Laura has no way of knowing that price will keep climbing it's just it's kind of a terror buying existence and it's not just Laura under insulin. This is a pattern we see over and over again back in August, the cost poems are on the rise and back in twenty fifteen. There was that farmer, Bro Martin, she credibly who jacked up the price of a key malaria and each ivy drug one tablet of death from used to cost thirteen dollars fifty cents. The drug maker recently increased the price to seven hundred, and it's all part of this really dig in uniquely american story is widely known that spending on prescription drugs continues to arrive. We cannot afford the drone wire the drugs expense. It consistently will take price increases, sometimes every six months, sometimes a reporter can anything be done to stem the tide to help those american struggling to pay for their prescription drugs. Today we

one stock. Through some of those questions, I'm Sarah Cliff and I'm late Sheldon and in this episode we're going to tell you why the prices and prescription drugs are so incredibly high in the United States. We'll talk about how our policies have led to the prices that we have and will walk through the impact of those policies, the good and the bad so Laura. She is an example of the negative side effects that high drug costs can have over the decades she's watch, the price of ever brand of insulin just go up and an up, and it's not just her brand. The two other companies that make insulin have also bumped up their prices right and because Laura has type one diabetes going with out and slain is not an option without insulin, I would die quicker than most people would with. water, so it would be like the water was controlled by three companies and they can charge you whatever they wanted ever since

was diagnosed. Laura has been making very careful choices about what to study and where to work. also that she can be sure she has a job with insurance that will cover the ballooning price of her insulin. What do you want a law school in part? Just so you could get health insurance in part. Every thing in my life is just so I can get health insurance. I mean everything is, but even though- or a structured everything around making sure her insulin was paid for she couldn't plan for the recession and when the economy crashed, Laura lost her job. as a lawyer yoga severance package. But when that's you lose insurance effective that day to afford her insulin, Laura took on credit card that she cast out Where one k, my parents, like me, money out of their retirement It was horrifying Why Laura has this extra insulin stash in her fridge, if she ever This is her job again if her insurance does

come through, she never ever wants to worry about where her next vile of insulin will come from users. Who I mean those? as they deal with my chances, are good. Why? If it tomorrow, they decided insulin ass, a million dollars, a vile I'm using the is you know, and I mean ok, so for Laura, the rising cost of insulin is not just a theoretical thing. It's an issue she really worries about and has shaped her life and what so crazy about this list is that it might not be an issue at all if Laura live somewhere else in the world like if she lived in Europe or if you like, in Australia rate that same insulin, vile, that cost Laura two hundred fifty dollars in the states. It cost six. in pounds in the UK. That's a little more than twenty box and it's not just insight

in general medications cost much less and other developed countries than they do here in the United States, and that is because most developed countries have big government health systems that cover one socialized medicine and share in Britain. They do have something called the National Health service, be an age This isn't any just hearsay from nineteen. Forty, eight, this new health service will be organised on a national scale as a public responsibility, everyone will pay for it. and everyone will benefit, if you need treatment in Britain, the natures pay spreads and because then Hs covers everybody, it can have a with pharmaceutical companies to get lower prices for prescription drugs, so here's how that works! Farrah! Have you ever seen the movie you ve gotten ale, now

I hear you nothing sound on the streets of New York, just the breed of my own mail from you, think I saw it at some point in middle school. Maybe ok so Here's what you need to know. It's a romantic comedy. Of course starring men, Ryan and Tom Hanks may grow and owns this cute little children's book store and Tom Hanks is opening a soulless, big box, competitor just down the block fox books. Restore, has nothing to do with us. It's big overstocked and full of ignorant salespeople, but they discount, but they discount. can bring about the difference between the: U S and Britain, sort of like the difference between MEG Ryan, small Store and Tom Hankses Fox books and instead of drugs there,

buying and selling books, I felt sure books are do so soon me. The key thing here is how Tom Hanks his character can sell. Those books for so cheap his giant chain fox books by his millions and millions of books from published. So if Tom Hanks his character, decides the price is too high and that he's just not gonna buy the talks. The publisher is gonna, lose millions of dollars, so they have to negotiate to bring their price down and because Tom Hanks gets his books for cheap, he can pass that low price down to consumers as discounts. make Ryan store. On the other hand, what is charming little bookstore, you probably so what Fifty thousand dollars were the books in Ear Tom Hanks is

oh so romantically telling MEG Ryan that that's nothing. Compared to his millions and sales. The publishers can afford to lose migs business, so she can't really negotiate for lower prices. She has to take whatever price the publishers give her and that's why her books are more expensive, All these american insurance companies are like MEG, Ryan Stores, They have enough patients to really go to town with big karma companies like you lay Lily, which makes Laura's insulin but the age ass. They are like the Fox books of health care can go to you. I lily and say: look here's the deal you are selling us ends. For sixteen pounds, not a shilling. More

we are walking away in the you lose sixty million british customers. That is how the age ass gets lower prices for the british people and because we don't do this, there are thousands Americans, like they worry about the price of drugs. They rack up debts to afford their medications and some people skip doses to make their medications last longer, etc. So this means, if we want lower, prescribed drug prices in the. U S, we need a fox books, write something like Britons and age. S are we gonna get socialized medicine or was no. We actually already have and ensure that could be black Fox books. Is it Medicare its metal gear. You are right, so Medicare covers all american Sixty

an older there about fifty million people on it, which is only slightly smaller than the entire population of Britain, and some people think, if we let Medicare negotiate and it becomes like Fox books, it could force prices down. Lower prices, they would ripple out to the rest of the health care system. This sounds like a great idea, I'm all from more Tom Hanks in my life Let's do it. Yes, I'm sorry to birth above all, but we can't dammit seriously yeah seriously and you're gonna. Tell me why right I am, but I am going to need some help to do, yet I am Julie Ratner. I have now covering Health policy in Washington for thirty years. I was five when I started. And I think, when I started covering healthcare, they were talking about prescription drugs now there, years later there still talking about prescription drugs. They were. Even talking about prescription drugs before Julie Rosner was covering healthcare. I was there when Lyndon. Johnson sign

the Medicare Bill into law in nineteen, sixty five, that's the late. Had Kennedy. Speaking on C span back in two thousand three. He was telling the audience that the very first version of Medicare covered a lot of things, doctors, as it were in their so we're trips to the hospital, the one aspect that wasn't, there was the prescription drugs and that with some the kennedys constituents kept telling him. They wanted him to change its essays senator. When are you going to put in that prescription drugs? so he, along with a lot of other politicians, were trying to do just that. Proposals came up in the nineteen It is under Reagan again in the nineties under Clinton and go anywhere every time this came up. The pharmaceutical industry pushed back. They did not want Medicare to cover prescription drugs because they were afraid of exactly the thing we ve talking about this actually seems kind of weird like if Medicare covered, prescription drugs. That I mean a lot more business for pharmaceutical companies, but they were.

so worried about price controls. They said no to the whole thing. The theory was if the government start paying for something and Mary, here eventually will want to set the price that that was what the drug industry feared most that they would just be another regulated provider of health care under Medicare? Okay, so something changed right because Medicare does cover prescription drugs. Now they pay for my grandmother's heart medication. When I go to the pharmacy with her yes fast forward to two thousand and three and two thousand and three when George. W Bush got a republican Congress for the first time he thought. Well, let's steel is issued from the Democrats and do it ourselves good morning. Week. I was honoured to sign the Medicare ACT of two thousand three. This new I will give seniors better choices and more control over their health care and provide a prescription drugs benefit because Kennedy finally got what you wanted, not exactly the bill did pass but Kennedy he was not happy about it.

That's why he was on C span on that day in two thousand three: it's a raw deal. But the seniors again. This country and Kennedy was not alone. Senator John Mccain from Arizona was really mad to this package, explicitly prohibits Medicare from using purchasing power to negotiating lower prices with manufacture. How is that possible? In two thousand three Emma was very clearly in bed with the Republicans, so the drug industry was very adamant and they went in saying that their price for supporting this and they did sport. It was that the government not set prices. The drug industry basically said you want Medicare coverage for prescription you need to promise us. They will never ever be able to negotiate prices Senator Mccain. he had a really choice, analogy for the whole thing. The sledges

It reminds me of the ancient mediaeval practice of leaching. Every special interest in Washington is touching itself to this legislation and sucking Medicare dry. This was not the end of the fight for years after that huge covered at all. So this is two thousand seven. Then Senator Barack Obama took up the issue on the presidential campaign trail. The pharmaceutical goes that's, but no thanks for overpriced drugs, drugs that gas twice as much here as they do in Europe and Canada Mexico will Medicare negotiate for lower prices, so young Oh idealistic! Let me guess it didn't work out that way it did not.

Obama, one enters healthcare law to go through, but in order to do that, he had to get every single Democrats support it, so he needed to get Pharma on board. If farmer had been working against it, not a chance. Obama compromised, Obamacare passed, but Medicare still couldn't negotiate drunk prices, and that is where we are today, the drug companies prices and Medicare pays them. So that's where things stand now, but we still hear politicians talking about Medicare negotiation. We heard Clinton and Donald Trump, both on the campaign trail in twenty. Sixteen saying that they thought it was a good idea and the american people agree with them. A Keyser they foundation poll, shows that eighty three percent of Americans think that is a good idea, but it

really logical. I mean that's why the public support it will, of course, if they could negotiate, couldn't it lower prices. Of course, the the way they could get lower prices is if they were to cover fewer drugs. This is the part that really doesn't come up much and arguments about letting Medicare and be like a big box and bookstore, but but it's a really big tradeoff and we need to talk about it. Medicare in order to negotiate, has to be willing to say this drug is too expensive and we're not going to cover it Tom Hanks is Fox. Books can only get lower prices because its willing to walk away from the negotiating table, and it's pretty much the same with these big government. Healthcare systems like the image ass in Britain there not just negotiating on dry

prices there, also making some really tough choices about which drugs they're going to cover its a sensitive debate, which new drugs can the other chess in England afford this time? Is the breast cancer drug cut soil? It that's from a BBC report in two thousand fourteen, this new breast cancer drug had just come out and the any chasse was negotiating with the manufacturer to get a good price. Andrew Delian was there. He was one of the negotiators for the any chance, and this is what he told the BBC, the price that the manufacturer ones to charge. The annexes puts it well beyond anything, Wickham's portion This is a drug that gave patient around six more months of life, but it would have cost the h US equivalent of a hundred and seventeen thousand dollars per patient. So, instead of asking hey, do they Medicare should be able to negotiate lower prices.

Julie, Rovner thinks we should ask a different question. Well, would you suitable support, Medicare negotiation? If it meant there was a smaller choice of drugs, people don't really like tradeoffs. Ok, that's the short term tradeoff were making is Medicare is going to negotiate prices, it can't cover every single drug, and even if we're ok with that, we also to consider a second longer term trade. Let's say: Medicare does managed to bring prices down. If we do pay last format occasions, we might get less new drug research, but that's it that's the conversation we should be. Having is what's the appropriate innovation approach, trade off we can accept. We can't just ignore the fact that we're gonna get less innovation sticker had the sands, and they then have we if we cut prices there are no negative effects. This is Craig Garth, wait he's in it. See it professor, at the Kellogg School of management. So let's be really clear about what Craig is not saying. It is not that the money you

in profits today is then reinvested or research and development. The future we hear this of argument from pharmaceutical companies. All the time like, oh, we need to charge lots of money for this drug so that I can take that money and put it into making new drugs. Craig said That is not how it works right. He said it's more about people trying to decide whether they're going to invest in the first place. So imagine that Craig and your capitalist. His sitting down at his desk with this giant pile of money, I've got ten million dollars to invest in any number of products right, one of which might be the next Euro, great social, media that generates no valuable people still pay for, and one of which is the potential pure pancreatic cancer, so Venture capitalist crag sees that Medicare as driving down the price of prescription drugs. He might say you know what there isn't a high enough chance. A profit from this. I'm gonna go, invest in that social media upper cellphone game

which could potentially weavers with a bunch of new cell phone games instead of new innovative drugs, accepts ok, we need to make a really important distinction here. Not all expensive new drugs are actually all that innovative. There is a huge difference between breakthrough drugs. These new pills that cure disease and tweaks Where are you just kind of updated drug that already exists? Small changes in the expected, a value of life from a drug are getting pretty outsize rewards, which brings us back to Laura and her insulin. there are some diabetes technologies that are really new. Laura showed us. This great gadget that feeds data about her blood sugar into her smart watch. You grew Roy. You can see journalists were thus which is like a more appetising me, I'm sure it's late, it greatest, but insulin. We

how to isolate it back in the nineteen twenties and yes, there have been tweaks and improvements over time, but the World Health Organs Nation says that those tweaks dont really make enough of a difference in patients lives to justify the ballooning cost. So for Laura. Ok, I'll pay more for further fancy thing that transmits to my watch when it comes to and so on. Just trying to live so Liz you were there with me in lorries apartment, it's such a hard situation, she's dealing with and being their singer insulin the cost so much money in how she's organizing our life around it. I just have this: pulse where I want to fix it. I know me too, and the whole time I'm thinking there has to be an easy way to do this. There has to be an easy fix, but harder than I see it, there are always going to be

It's like consider Laura's situation. On the one hand we could stick with the system we have now, where Laura chooses are insulin and it's two hundred and fifty dollars and it's so expensive for her to afford on the o and we could switch to a system that negotiates, but that's risky for Laura too. She could end up with a lower price for her drug or it may be, a situation where the government says they're, going to cover a different type of insulin and all of a sudden nobody's willing to pay The insulin she's been taking for twenty years in, if we, you decide to go that route. We might have to accept that we'll get less innovation and the drug market if we want to lower drug presses. If we want to help people like lore out. That's fine. That is a totally appropriate policy priority we have to realise that, in order to do that, we have to make some sacrifices.

rates of that was are podcast. We had so much when making it a lot of. Thank for the work that went into this first and foremost our producer, the amazing bird Pinkerton. We had engineering helpful Peter Leonard and Ac Valdez, and thank you so much, ah spawning as applying for some of their feedback along the way. And now we have just a little bit of work for you as you are travelling home for Thanksgiving or making a turkey what every we're doing dont forget to. is an email at reads at box dot com with two things. I do for what we should name, this podcast and any feedback. You have This episode, whether you want to hear, policies- and please please, please and all of that to weeds at boxed outcome, and we are so eager and excited to read all of your emails. Thank you. So much in advance