The AMA to Drug Companies: It’s Time You Stop Lying to Consumers

Will the AMA's new plan ensure pharmaceutical companies operate with transparency?

Transparency: The condition of being free from pretense or deceit; readily understood; characterized by accessibility of information.

According to the American Medical Association (AMA), Big Pharma lacks transparency. Consumers don’t really know what these companies are up to and it’s hurting patients.

Keeping true drug prices close to their vest, pharmaceutical companies use marketing campaigns to drive expensive prescription requests – then raise those prices even more. The AMA claims this combination of marketing tactics and hidden price increases is far from honest transparency. Frustrated with current trends, doctors are calling for changes to correct this obvious deficiency in open, honest business practices.

A Three-Fold Change

During their annual meeting in June, the AMA called on the pharmaceutical industry to increase transparency in three steps:

  • #1 – List suggested retail prices of drugs in direct-to-consumer ads
    Did you know direct-to-consumer advertising of prescription drugs wasn’t always legal? Until 1997, it was banned in the U.S., and it’s still illegal in almost every other country. Perhaps that’s for a good reason. The AMA reports that prescription medications advertised directly to consumers saw price increases of 34.2 percent, while others saw only a 5.1 percent increase. Unaware of their exorbitant cost, patients request certain medications from their doctor, even though lower-cost alternatives might be available. Consumer knowledge of drug costs could help curb this overspending.
  • #2 – Increase affordable access to naloxone
    The AMA correctly pointed out a sudden and disturbing increase in cost of naloxone. It seems more than a coincidence that naloxone manufacturers enlisted the help of public officials and healthcare providers to raise awareness and use of naloxone, then dramatically increased the prices. First responders, schools, and community groups that rely on this drug to save lives are now finding it tough to keep up with the rising costs. The AMA plans to support legislative and regulatory efforts that will make access to this life-saving drug more affordable.
  • #3 – Give public notice before increasing the price of drugs
    The AMA is asking pharmaceutical companies to provide notice if they increase a drug’s price by more than 10 percent during a 12-month period. This would (hopefully) put a damper on the prices of prescription drugs, which have a tendency to quickly but quietly climb. The AMA believes this requirement to announce significant price increases will help prevent skyrocketing prices that gouge consumers.

Steps in the Right Direction

AMA President-elect Barbara L. McAneny, M.D., explained in a statement, “Taken together, these policies would bring much needed transparency to drug pricing and provide a clear benefit to consumers struggling with exorbitant costs. There seems to be no logic – or warning – to these price spikes. In the case of naloxone, communities are struggling to afford this life-saving treatment. Sunlight is needed to help respond to price shifts, because if the pricing trends continue, patients and communities will not be able to afford life-saving drugs.”

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