Why the US Healthcare System Sucks Wet Farts from Dead Pigeons,

How many of you have an Albuterol inhaler for Asthma?

It's great, isn't it?

The drug is out of patent, so it's cheap, and it works.

It's not like a big pharma would lobby to get the FDA to ban the cheap inhalers because of their miniscule use of CFCs, and then wrap new propellants in a patent web and jack up the price, right?

Oh, silly me, that IS what they did:

The arsenal of medicines in the Hayeses’ kitchen helps explain why. Pulmicort, a steroid inhaler, generally retails for over $175 in the United States, while pharmacists in Britain buy the identical product for about $20 and dispense it free of charge to asthma patients. Albuterol, one of the oldest asthma medicines, typically costs $50 to $100 per inhaler in the United States, but it was less than $15 a decade ago, before it was repatented.

“The one that really blew my mind was the nasal spray,” said Robin Levi, Hannah and Abby’s mother, referring to her $80 co-payment for Rhinocort Aqua, a prescription drug that was selling for more than $250 a month in Oakland pharmacies last year but costs under $7 in Europe, where it is available over the counter.

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Unlike other countries, where the government directly or indirectly sets an allowed national wholesale price for each drug, the United States leaves prices to market competition among pharmaceutical companies, including generic drug makers. But competition is often a mirage in today’s health care arena — a surprising number of lifesaving drugs are made by only one manufacturer — and businesses often successfully blunt market forces.

Asthma inhalers, for example, are protected by strings of patents — for pumps, delivery systems and production processes — that are hard to skirt to make generic alternatives, even when the medicines they contain are old, as they almost all are.

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But in the United States, even people with insurance coverage struggle. Lisa Solod, 57, a freelance writer in Georgia, uses her inhaler once a day, instead of twice, as usually prescribed, since her insurance does not cover her asthma medicines. John Aravosis, 49, a political blogger in Washington, buys a few Advair inhalers at $45 each during vacations in Paris, since his insurance caps prescription coverage at $1,500 per year. Sharon Bondroff, 68, an antiques dealer in Maine on Medicare, scrounges samples of Advair from local doctors. Ms. Bondroff remembers a time, not so long ago, when inhalers “were really cheap.” The sticker shock for asthma patients began several years back when the federal government announced that it would require manufacturers of spray products to remove chlorofluorocarbon propellants because they harmed the environment. That meant new inhaler designs. And new patents. And skyrocketing prices.

“That decision bumped out the generics,” said Dr. Peter Norman, a pharmaceutical consultant based in Britain who specializes in respiratory drugs. “Suddenly sales of the branded products went right back up, and since then it has not been a very competitive market.”

The chlorofluorocarbon ban even eliminated Primatene Mist inhalers, a cheap over-the-counter spray of epinephrine that had many unpleasant side effects but was at least an effective remedy for those who could not afford prescription treatments.

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A result is that there are no generic asthma inhalers available in the United States. But they are available in Europe, where health regulators have been more flexible about mixing drugs and devices and where courts have been quicker to overturn drug patent protection.

“The high prices in the U.S. are because the F.D.A. has set the bar so high that there is no clear pathway for generics,” said Lisa Urquhart of EvaluatePharma, a consulting firm based in London that provides drug and biotech analysis. “I’m sure the brands are thrilled.”

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And here is the money quote:

This year the price of Advair dropped 10 percent in France, but in pharmacies in the Bronx, it has doubled in the last two years.

For what it is worth this is not technically a failure of the free market.

These companies' profit margins are being directly supported by the state. That is the nature of patents and other exclusive licenses that we grant, particularly in the drug industry.

Then we allow for these exclusive licenses to be extended ad infinitum through evergreening.

The problem is that we as a society allow people to patent nothing at all, and sometimes we grant exclusive right to people who didn't invent anything at all, as in the case of colchicine, where exclusivity was granted for a study of the drug which consisted primarily of a survey of the historical literature.

The price of colcicine went from $0.09 a pill to $5.00 a pill.