We Need Regulated Prescription Drug Prices

The federal government needs to step in to start regulating the high costs of prescription medications. The United States is the only advanced country that doesn’t regulate prescription prices and the result is painful for an individual’s pocketbook.

The cost of prescriptions increases 10 to 12 percent each year in the United States. Instead of the government keeping this cost down, insurance companies have to negotiate with drug companies for discounts. Drug manufacturers say the rising costs are due to research and development, but the average profit margins of drug manufacturers is 17 percent each year. Compare this with the average profit margin of three percent for other top industries, and it’s no wonder we’re complaining about health insurance costs.

It would be an easy move for Congress to pass legislation capping the costs of prescription drugs. The legislation shouldn’t hinder research and development of future drugs; but it should put the industry in line with other top industries and prescription costs in other countries. While this would in essence be a small move by the government, it would result in huge decreases each year for the average drug purchaser. If a cap of prescriptions could be placed on drug companies limiting their profit margins to three percent, the prices of drugs could diminish by 14 percent or more.

The problem is that drug companies are incredible lobbyists in Congress and donate huge amounts of money to the political campaigns of our government leaders. Our leaders are under a large amount of pressure by drug companies to keep the drug industry largely unregulated in terms of cost.