These days, already-hurting pharmaceutical companies are fighting a new uphill battle obtaining insurance reimbursement for newly approved drugs. Not only must companies prove to the FDA that their medications are safe and effective, but they now must demonstrate to insurance companies that these drugs are worth paying for. That is, a drug company must show that a given drug s cost will be offset by future savings in health care services, as well as providing a substantial benefit over existing drugs. This latest hurdle may be a hard sell, especially as lower-cost generic products become widely available.
Many may wonder how these policies affect the average person. Well, it s very simple, says ACSH's Dr. Gilbert Ross. If drug companies no longer have a profitability incentive, then their research and development departments will continue to wither away, and our grandchildren will have essentially the same pharmacopea available to them that we have now.
Additional financial pressures will certainly mean that drug companies will be less inclined to invest money into new research or be willing to commit the massive funds needed to get a new drug approved so novel medications will never get to market, adds ACSH's Dr. Josh Bloom. Certain diseases, particularly in the neuroscience, oncology and antibiotic fields, lack effective treatments, he points out. And reimbursement policies such as this one will surely hamper research in these and other areas.