Grumpy-One-Lung Posted April 9, 2004 Share Posted April 9, 2004 Prescription Drug Pricing, July 2002 By Steve Wilson News in Detroit WXYZ July 22, 2002 If you're one of the millions of Michiganders who have to pay out of your pocket for the prescription drugs you need, hold onto your wallet. Action News Chief Investigative Reporter Steve Wilson has the story your neighborhood drugstore doesn't want you to see. Alan Greenspan testified on Capitol Hill bemoaning what he called "infectious greed" that has gripped much of America's business community. You knew about it at Enron, you've heard of Worldcom, Kmart and the others?but even down at your local pharmacy on the corner, when it comes to pricing? Greg Pabb may not be the last honest man in the drugstore business but I didn't find many like him in my investigation of pharmacies throughout Metro Detroit?a local businessman with the courage to confess what he admits is nothing less than price gouging rampant at all kinds of drugstores all across Metro Detroit and beyond. Now we're not talking about the skyrocketing cost of brand name drugs which year after year make the American pharmaceutical industry richer, nor the fact that Americans can cross the border into Canada and buy the same U.S. made drugs for a fraction of the cost. No, we're talking about the drugs we're promised will save us lots of money. How to avoid paying too much for prescriptions? Pharmacists all agree generic versions of name-brand drugs give you the same medicinal benefit at a tiny fraction of the cost of their brand-name equivalents. But the truth is if you're like these folks and paying for your own prescriptions because Medicare doesn't cover it, or you don't have a job that gives you health insurance, or even if you do but your insurance doesn't cover drugs, you may be saving some, but what your friendly pharmacist doesn't tell you? He's putting the lion's share of the savings right into his own pocket and hoping you never find out. It's a fact the industry vehemently denies. But that's exactly where we found it. It's a secret every insider seems to know but virtually nobody wants to tell. We went to store after store after store where a prescription for a generic that costs the pharmacy only about $2 is being sold to many of you for as much as $100, despite their denials. A Closer Look at Cost Prescription drug prices, they're the fastest growing segment of health care costs today, and now we're learning it's not only the big drug makers reaping sky-high profits, local drugstores encouraging you to buy lower-cost generic drugs are quietly keeping most of the savings for themselves. Take Vasotec, which many people need to treat their high blood pressure and heart problems. But now the generic version called Enalapril Maleate is also available. The shape may be different but it goes down just as easy, and instead of spending $76 on a one-month supply of the name-brand Vasotec, wouldn't you be pretty happy if somebody behind the pharmacy counter at CVS suggested you buy the generic for only $61??And buying these got you a 20% savings of $15? only guess what the friendly pharmacist at CVs never tells? That generic the pharmacist recommended and sold you for $61 has a true wholesale cost of less than $6? and CVs probably pays even less for it. While the markup on Vasotec is only minimal, CVs marks up the generic by a good 921%. And CVs is by no means alone. The markup at Walgreens is only a tiny bit less. Walgreens in Oak Park sells the same prescription for $58.19. Some of the independents we checked seemed even greedier. At Birmingham drug? The cash price was about $68?and even though it says Save On Pharmacy, we found Pharmacist Pabb was the one saving the most by charging what he now admits is an "unconscionable markup." Now, we heard them singing the same song at lots of Motown drugstores where the pharmacists claim the big insurance companies are to blame for this because Blue Cross, and the others, just won't pay enough when insured people need medication. In Lansing, Bill Knox speaks for the American Association of Retired Persons, whose members are among those hardest hit by what he says are these unconscionable markups. Insurers like Blue Cross do save millions when their members choose generics because the big players keep an eagle eye on the true cost of drugs. Franz Neibrecht at the Michigan Pharmacists' Association says Blue Cross sometimes pays the pharmacy so little on some drugs, it's members sometimes have a hard time making any profit?A claim denied by Richard Cole of Blue Cross Blue Shielf of Michigan, who says there's just never any excuse for unethical, if not illegal, markups to people not covered with a prescription plan. Generic Prozac is an even better example of what so many druggists are quietly doing to those who can least afford and have no help to pay for the prescriptions they need. A 30-day supply of the generic Prozac is a prescription that costs drugstores just $2.16 or less. But when a month's supply of the name-brand Prozac itself sells for about $100, drugstores like Heritage Pharmacy in Allen Park sell the generic for $92.24?and tell you "you're still saving a few bucks." And now don't focus your anger on Gregory Papp just because he's honest enough to admit it?over here at Birmingham Drug, the $2.16 generic Prozac called Fluoxetine has been fetching $89.59. That's a markup of more than 4,000% for you math fans out there. And Walgreen's is not that far behind at $74.49. CVs and Rite Aid both collect $72.99. Mr. Didur, who works for a corporation that claims to be committed to the highest level of integrity in every aspect of its business, was kind enough to do another price check?but no happier with the result. The truth is no matter where we went, from the big chain drug stores to the independent, to the pharmacies at Krogers and Farmer Jacks, even to the so-called discounters like Meijer and WalMart and Kmart, too, we found to one degree or another, much if not most of the potential savings on generics are going into the till at the pharmacy. It's true on the generic form of Zantac, the popular ulcer drug that costs $7.50 wholesale but has been sold for more than $127 in Birmingham where owner Bill Krasnick told me affluent customers can afford to pay a little more?and Atenolol, another blood pressure drug, that costs less than $2 but is selling for as much as $25.49?and the generic brand of Pepcid, the popular heartburn medication, a $5 prescription that's been bringing well over $100 at a couple of those places where the pharmacists believe the market will bear it. Is their anybody we found NOT cashing in? Martin Peltz manages the pharmacy at Costco and on each and every one of the drugs we checked, it was the pharmacy at Costco that was not only cheaper but dramatically far and away cheaper than everyone across the Metro area. While that other pharmacy is charging $92 for generic Prozac, Costco is selling it for $9. When the chain stores sell generic Pepcid for close to $100? 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