Introduction[MA1] chronic administration of this drug a full year,

IntroductionMA1 

In 2016, Saudi
Arabia’s pharmaceutical expenditure have been estimated to be $6.9 billion with
an annual increase by 10%. Also, pharmaceutical spending per capita is $268 and
expected to rise in 2020 to $400. In Saudi Arabia’s 2030 Vision, the economic growth
was shifted more towards pharmaceuticals. Many factors including aging population, increasing per capita
spending, and the force to purchase patented drugs are driving forces towards
growth of drug expendituresMA2 . 1

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Drug
related factors in increasing drug expenditure

Increases in drug prices are pulling attention to an increase
in pharmaceutical expenditure on health care institutions. The ultimate goal of
innovating drugs is the improvement of patients’ quality of life 2. However, high prices of some drugs that will be
mentioned lately, can put pressure on healthcare providers and consumers. In
particular, the cost-benefit should always be the main goal. This means that
effectiveness of drug is a must compared to its cost. The jump in prices can probably
be explained by the cost of development of new agents by different technologies,
investing in research, and an eager to return a profit to the pharmaceutical
companies 3.MA3 

In order to explain the increase in drug expenditure, we
first should mention some of the expensive drugs used in institutions. First of
all, Hepatitis C virus needs Sovaldi which is used for three months course that
costs $1000 in a day. So, in total, it costs $84,000 in each course. In
addition, some patients may need to take the drug for twice as long or should
receive extended drug treatment that adds more to the cost 4. Second, Cystic Fibrosis and one of its medications is Orkambi.
Mentioning that CF needs chronic administration of this drug a full year, it costs
$259,0005. Third, high blood lipids especially
heterozygous familial hypercholesterolemia which mandates a life-long treatment
called Praluent, that costs $14,600 per year. Not
to mention that this Hypercholesterolemia also needs other medications such as
Statins which are fairly high priced. Lastly, Lyrica,
used for wide range of neuropathy, has brought $517 billion to the company. The
drug’s price has raised by 51% in the past three years and one of the causes is
of patent extension 6,7,8 These drugs
undoubtedly improve patients’ quality of life. Nonetheless they are
astronomically costly.

Why drugs cost
this much?

“Companies
are taking advantage of a mix of laws that force insurers to include
essentially all expensive drugs in their policies, and a philosophy that
demands that every new health care product be available to everyone, no matter
how little it helps or how much it costs.” Peter B. Bach.

There are many
reasons for increasing prices of drugs. Starting with patent abuses and other
monopoly pricing schemes, addressed product-hopping which is intentionally
prolonging drug patents to delay generic alternatives. In turn, this increases
the cost 9. For example, Actavis tried to pull
a very effective and top-selling Alzheimer’s disease drug to switch it with an
extended release, a more expensive drug. This act will prolong the patent and,
stop generic substitutions. Another reason is research and drug investment, and
marketing and sales themselves are a costly process that pushes the
manufacturer to sky-rocket the prices to have more in return. Pay-to-delay, is
a third point in increased drug prices. It is paying to generic drug makers to
keep them out from competing in the market 10. Sometimes
no generic competitors enter the market and the prices just never drop. Clearly,
product-hopping, willing to have profit, and pay-to-delay are some of the
causes of increasing drugs’ prices.

How to control
such expenditure on expensive drugs?

Expenditure can
be reduced by many ways. For example, from disease related point of view, the
pharmacist can evaluate the patient’s need in comparison to the drug price. To
emphasize, Hepatitis C can induce chronic liver disease. So, it can be managed
by reserving Sovaldi to advanced liver disease. Moreover, higher organizations such
as New York State Attorney General should monitor pharmaceutical companies’. New
York Attorney General upheld the switching action of Alzhiemer’s drug which
restricted the increase in price.

“Unfortunately, schemes to block competition, without
considering the consequences to patients, are a growing trend in the health
care industry. By standing up to Actavis, we’re sending a clear message to all
pharmaceutical companies: Prioritizing profits over patients’ rights will not
be tolerated,” Schneiderman said in a statement 10. In other ways, pharmaco-economic departments in health institutions
should look into cost-benefit relationship. To end up, expenditure reduction methods
are various but the role of pharmacist, pharmacy organizations, and the act of
general economic law by NY Attorney General are the main actions discussed
previously.

          Conclusion

Astronomic
prices are for sure a reason to growth is drug expenditure; however, the
effectiveness of drugs and benefit on patients is the main goal for health
institutions. Increase in drug prices is one of the reasons for increasing in
drug expenditure. The
sky-rocketing prices can be explained by the cost of development of new agents
by different technologies, investing in research, and an eager to return a
profit to the pharmaceutical companies. Why are drugs costly? Product-hopping,
willing to have profit, and pay-to-delay are some of the causes of increasing
drugs’ prices. Methods to reduce expenditure are either to cut-up the price by
higher organizations, or can be at the level of pharmacist by weighing the
cost-benefit use.