The Generic Drug Rip Off: Life Extension Editorial

The Economic Collapse of Argentina

In the 1940s, Argentina was the ninth wealthiest country in the world. At one point it was richer than France and boasted a higher standard of living than Canada. It was considered one of the best countries in which to live.1

After an endless series of reckless governmental actions including uncontrolled borrowing and economic mismanagement, Argentina’s standard of living ranking has plummeted to 46th.2 If you had money in an Argentinean bank in 1999, it vanished. If you owned Argentinean government bonds, you lost most of your principal as the central government defaulted on its obligations.

Health Care Costs Bankrupting United States
The Generic Drug Rip Off

Everything Life Extension® predicted about the health care cost crisis is happening before our eyes. Major corporations, individuals, and the government are being bankrupted by out-of-control medical costs. Some say the economic challenges facing the United States will result in substantially reduced standards of living. This does not have to happen.

As we long ago identified, the cause behind spiraling medical costs is a crooked and ludicrous regulatory structure.

Today’s health care cost crisis is widely acknowledged and feared. No one, however, has yet proposed a practical solution to resolve it.

Even We Are Selling Overpriced Drugs

Three years ago, we established the Life Extension Pharmacy™ to provide members with unique health services and the lowest drug prices. Even though our prices are consistently at the rock bottom end of the marketplace, you still grossly overpay for generic drugs—no matter where you buy them.

The reason for high-priced generics is not because the active ingredients are expensive. On the contrary, compared with complicated nutrient extracts, the ingredients in drugs are usually synthetic chemicals that cost only pennies a day.

The culprit behind overpriced generic drugs is an archaic regulatory environment that functions to protect pharmaceutical financial interests, forcing consumers to pay artificially inflated prices for their generic medications.

If our proposal to overhaul today’s inefficient regulatory system succeeds, at least part of the health care cost crisis will disappear quickly. A side benefit to lower-priced generic drugs is that it will force pharmaceutical companies to bring out life-saving medications faster, since almost-as-good generics will cost virtually nothing.

An Example of a Grossly Inflated Generic Price

Once a brand drug comes off patent, generic equivalents emerge, but they cost far more than they need to because of FDA over-regulation.

Take the drug finasteride (Proscar®) for example. It came off patent in 2006, but at the end of 2008, chain pharmacies were charging about $90 for 30 tablets (a one-month supply). All it takes to make this drug is to put 5 mg of finasteride into a tablet that dissolves in the stomach. Vitamin companies do this every day with nutrients, but the FDA does not allow them to freely do the same thing with drugs.

We checked on the cost of buying finasteride and making it into tablets.

The free market price for 30 tablets is only $10.25, which includes an independent assay of the ingredient quality, potency, and tablet dissolution—and a reasonable profit margin.

It is against the law, however, for GMP (Good Manufacturing Practices)-certified vitamin manufacturers to offer low-cost generic drugs. This prohibition must be lifted as America can no longer afford to subsidize those who are politically connected while the country is driven into insolvency.

Finasteride is a drug that not only helps relieve benign prostate enlargement, but may also reduce the risk of prostate cancer.3-5 Widespread use could save Medicare lots of money in expensive prostate treatments. Those who follow Life Extension®’s other recommendations would be expected to reduce prostate cancer risk even more.

As evidence mounts about the prostate cancer risk reduction associated with drugs like finasteride, more companies are competing to make it, but its average price at chain pharmacies is around $86 a month—a staggering eight times higher than what its free market price would be!

Please note that generic prices tend to wildly fluctuate. In this case, as more competitors entered the market, chain pharmacies did not substantially lower the price of finasteride. In some cases, the opposite occurs, and by the time you read this, the price could vary.

Mollifying the Cynics

No matter how many facts I list showing that these free market drugs will be safe, there are alarmists who believe that even if one person suffers a serious adverse event because of a defective generic drug, then the law should not be amended to allow the sale of these less-regulated products.

What few understand is that enabling lower-cost drugs to be sold might reduce the number of poorly made drugs. The reason is that prescription drug counterfeiting is a major issue today. Drugs are counterfeited because they are so expensive.

With a month’s supply of free market simvastatin selling for only $3.20, it is difficult to imagine anyone profiting by counterfeiting it.

So amending the law to enable these super-low-cost drugs to be sold might reduce the counterfeiting that exists right now.

Another reason these less-regulated generics will do far more good than harm is that people who need them to live will be able to afford them. The media has reported on heart-wrenching stories of destitute people who cannot afford even generic prescription drugs. They either do without, or take a less-than-optimal dose. The availability of these free market generics will enable virtually anyone to be able to afford their medications.

Preserving Our Country’s Financial Future

The cost of prescription drugs is a significant factor in today’s health care cost crisis, a problem that threatens to bankrupt consumers and this nation’s medical system. Passage of common-sense legislation would quickly slash the cost of generic drugs so low that consumers could obtain them for less than what their co-pays currently are. Enormous amounts of money would be saved by public and private insurance programs, and ultimately consumers.

According to the Government Accountability Office (GAO), all federal revenue will be eaten up by government outlays for Medicare, Medicaid, Social Security, and public debt interest by 20258,9—just 16 years from now!

We as a nation can no longer afford to be bound by today’s inefficient regulatory system that artificially inflates the cost of our prescription medications. The money is no longer there to support this bureaucratic morass.

Fight Back Against This Institutional Corruption

The United States of America faces a health care cost crisis that will render Medicare and many private insurance plans insolvent. Next month I will reveal shocking details about how bad Medicare’s finances really are.

When terrorists attacked the United States in 2001, there were patriotic Americans who enlisted in the armed services. Many lost their limbs, their vision, and their lives.

No one has to engage in physical combat to save this country from the institutionalized inefficiencies and corruption that plague today’s disease-care system. All you have to do is type-in www.lef.org/lac on to your computer and easily send a copy of this article to your Representative and two Senators (along with the letter that appears at the end of this article "Letter to Washington").

Just punch in your name and address, and our Legislative Action Center (www.lef.org/lac) locates your Representative and Senators. It is that simple to take affirmative action to help save our country from the insolvency so many countries chronically suffer with.

This article will be read by over 300,000 Americans. In previous legislative initiatives, fewer than 6,000 people bothered to spend a few minutes logging on to our convenient Legislative Action Website. This kind of citizen apathy is why the federal government continues to trample our liberties and empty our pocketbooks.

The form letter below "Letter to Washington" can be printed (along with this entire article), and mailed to your members of Congress. To find out where to mail these letters, call 202-224-3121. It is of course much more convenient to log on to www.lef.org/lac

I sincerely hope that after reading this article, not one Life Extension® member will fail to take this simple action to help protect this nation’s economic future.

For longer life,

For Longer Life

William Faloon