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Daytona Beach News-Journal (FL) Op-Ed
By: Sally C. Pipes
7.20.2006

Daytona Beach News-Journal, July 20, 2006

Letters to the editor

The July 6 editorial "Higher drug prices: Medicare Part D fails seniors" argues that seniors would be better off with Medicare negotiating drug prices, just as the Department of Veterans Affairs does. As president and CEO of Pacific Research Institute, I beg to differ. When governments must pay for medicine, they invariably try to save money by restricting availability of cutting-edge drugs. In fact, the VA system is a perfect example of this perverse incentive.

 

The VA drug formulary, which determines the medicines available to veterans, is extremely restricted. Only 19 percent of drugs approved by the FDA since 2000 are listed on the VA formulary. Only 38 percent of drugs approved in the 1990s are listed. For example, the top-selling drug Lipitor, a statin that lowers the risk of heart attack and stroke, is not on the VA's list.

 

Government "price negotiations" have already choked off drug innovation in far too many countries. That's why people the world over use cancer and AIDS medications invented here. If Congress now strikes the noninterference clause -- i.e., implements price controls for the Medicare drug market -- even more life-saving breakthroughs will be lost.

 

SALLY C. PIPES,
San Francisco

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