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Feb 02, 2005
CONTACT: Jerry Flanagan - 310-392-0522 x319
State of The Union: Strong Profits for Drug CompaniesPresident Bush's continued opposition to making prescription drugs affordable will mean "increased profits for drug companies, a larger national deficit and more Americans going without the care they need," according to Jerry Flanagan of the Foundation for Taxpayer and Consumer Rights (FTCR).
Drug company profits have surged in recent weeks as analysts predict increased profits as a result of President Bush's Medicare drug plan, which banned Medicare from negotiating volume discounts on prescription drugs.
"Every American is hurt by overpriced prescription drugs in the form of higher health care costs and increased taxes," said Jerry Flanagan of FTCR. "Instead of making health care more affordable, President Bush has handed over control to those who will stop at nothing to make a profit."
Although the President will likely discuss his plans to privatize the Social Security system in his State of the Union address tonight, the Congressional Budget Office has concluded that cost increases in the Medicare and Medicaid public health care programs pose a larger problem for the federal budget.
Under pressure from drug companies, President Bush and Congress opposed amendments to the 2003 Medicare drug law that would have allowed the Medicare program to harness the buying power of its 41 million members to negotiate discounts with drug manufacturers.
The Medicare prescription drug program, expected to cost more than $500 billion over the next 10 years, could save 30-70% if the program were to be allowed to negotiate volume discounts on drugs. The 39 million-member U.S. Department of Veterans Affairs uses a similar strategy to save 70% and more on prescriptions.
Yesterday, Michael Leavitt, the new head of the U.S. Department of Health and Human Services, said Medicaid, which provides health coverage for low-income Americans, could save $15 billion over the next ten years if price-gaming by drug companies and pharmacies were put to an end.
"We know how to make health care affordable for all Americans but corruption and political pandering at the highest level has halted reform," said Flanagan.
Drug companies gave $1 million in campaign contributions to President Bush and $16 million to members of Congress in the run-up to the November elections.
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The Foundation for Taxpayer and Consumer Rights is a nonprofit and nonpartisan consumer advocacy organization. For more information visit us on the web at http://www.ConsumerWatchdog.org
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