The United States has the most expensive prescription drugs in the world. We often pay ten times the price for the same drug, even though there's no difference at all. Why is American healthcare so expensive? In this episode, we take a brief look at America's prescription drug cartel, and why one critical drug, insulin, is so absurdly expensive.

With the transition from Team Red powerful old Guy to Team Blue powerful old Guy, a number of important topics have returned to the forefront of the American consciousness. One of the most important issues, as is the case in any country, is healthcare. While other develops, nations and even many far less developed nations enjoy less expensive healthcare with better outcomes than the US. American citizens are on the brink of disaster now more than ever. In this episode, we're going to talk about the absurd cost of prescription drugs and why a life-saving medicine in the US can cost 100 of times more than in other countries. How did the drug improve? If I were to look at a pill and analyze it from 2 thousand and five, when it costs 200 and 15, and I was looked today at when it cost 700 and 63, would that pill be the same? I understand your question about the pill, the pill, the manufacturing for it would be the same. Great. Thank you, i want to turn to one other number. If you, you would help me. 

Do you know what this number is. 

I does it ring any bells? I think you're referring to my compensation in some way, you in some way. This was your compensation in 2017 for being CEO of S. Gene and that's a lot of money. Any increase in the price of revlimid would also increase your bonus by increasing earnings. Isn't that right. Mr. Ellis. If revenues increased and expenses did not, then earnings would be enhanced. Thanact, you personally received of. 
Half a million dollars personally just by tripling the price of revlement. So to recap here, the drug didn't get any better. The cancer patients didn't get any better. You just got better at making money. You just refined your skills at price gouging. 

What you just saw was representative Katy Porter grilling mark Alice, the former CEO of Pharma Company. Sell Gene over massive price hikes on their cancer drug recent. The executive admitted that despite the huge added cost of patience, the drug was fundamentally unchanged. It didn't work better or faster. There had been no improvements to effectiveness. It was exactly the same product, and yet the price for a single pill had jumped from 200 and 15 dollars already very expensive to 700 and 63 dollars. Where did this extra money go straight into executive pockets? Alice, who was already paid 13 million dollars per year, netted an extra 500 thousand dollars simply for raising the price of a single drug. This particular exchange went viral back in 2020, but the despicable practice of medical price gouging is far more widespread than this single example. In fact, it's standard American operating procedure before we get into the specifics. Let's look at a few basic facts about the American healthcare industry as a whole. 

The US spends more money per capita on healthcare than any other nation on Earth. You would assume that this expenditure would guarantee the best care in the world. That is not the case. Despite being the most expensive healthcare system on Earth, consuming over 16 percent of our GDP, it's one of, if not the least, effective in the developed world. We spend over 10 thousand dollars per capita on healthcare, and not only is the quality of care subpar, we don't even come close to covering everybody. Compare this to places like Germany, who pay drastically, less per capita and guarantee coverage to all citizens. There were over 27 million uninsured Americans in 2018, and that number will have skyrocketed in the last year thanks to millions of COVID layoffs across the country. Even before the pandemic, we had more uninsured and underinsured citizens than any other developed nation. In addition to not covering a large portion of the population, even those with excellent health insurance by American standards, that is, struggle to pay medical bills. Over 25 percent of insured people reported having difficulty paying for the exorbitant cost of their treatment. 

Of this group, 63 percent had to pay most or all of their savings to cover the medical bills and 42 percent had to find a second job. Life-saving drugs in America often cost ten times what they cost in other countries. For example, in Canada, one vial of insulin cost 32 dollars, in the United States, the same drug from the same factory costs 300 dollars. And that's not even an extreme example. 

Take the HIV drug Druvada. In Australia it cost just eight dollars. In the US it cost 2 thousand dollars. Despite US taxpayers footing the bill for its development. Every year over half a million people go bankrupt trying to pay their medical bills. In a country where 40 percent of the population can't afford a surprise 400 dollars expense, an ambulance ride to the hospital will cost you more than twice that amount and all of this is happening in the richest country on earth. 

This all sounds pretty bad right. It is of all the things Americans choose to defend. Our sadistic healthcare industry should not be one of them. It's inhumane, ineffective, and deeply corrupt. If you're wondering why our system is so awful, just follow the money. The healthcare industry spends more money on lobbying than the oil and defense industries combined, and those are both massive lobbies. Lobbying, of course, is just a euphemism for bribery. Lobbyists make generous donations to politicians. Those politicians pocket the money and write legislation that favors the donors industry. They both make money and average Americans are worse off than they were before. 

This cycle continues indefinitely and features a ludicrous revolving door wherein politicians often go on to become lobbyists themselves. It's a twisted charade and bears no semblance to actual democracy. But why are pharmaceuticals so lucrative? There are several reasons, one of them, the fact that the relationship between manufacturers, insurance companies, hospitals and middlemen is so convoluted that it's incredibly difficult to nail down when any one of them is price gouging. But beyond that, it's just simple math. Nearly half of all Americans take prescription drugs that's almost 100 and 65 million people, and it represents a massive market for pharmaceuticals. It's especially lucrative because many people require these drugs just to stay alive, so they'll pay whatever they have to. 

Let's take. Perhaps the most common example, insulin. 

There are roughly 23 million diabetics in the US, and if we expand that category to people who are pre-diabetic, the number shoots up to 100 million people, nearly a third of the total US population. When someone has diabetes, they rely on insulin. It's not optional. The average diabetic needs somewhere around two to three vials of insulin per month, though some people require much more in the range of four to six vials. Given the price of insulin in this country, the monthly cost is just too much for many people to afford all right. So got I got a serious question for everybody out there. 
I generally want to know this. Okay. 

How, how is everybody making it? How I'm like I've worked? I've worked for like 17 years. I work all the time. I've been paying medical bills on my son for nine years since he was born and he was just diagnosed with type one diabetes and that has to have insulin every two hours. I just got his prescription. It was 1 thousand dollars. I couldn't pay for it, i couldn't pay for it. I know I have to go in and tell my nine-year-old son i couldn't pay for it. I work a full-time job. My husband works a full-time job. I work. Third shift, i go to school during the night. 

How are you guys? Making It Am I the only one struggling. 

How how are you guys Doing it? 

But surely there's a good reason insulin is so expensive. Right well, let's take a look at the drugs history all the way back. In 1922, researchers from the University of Toronto announced the discovery of insulin. Two of the researchers. Dr. Frederick Banting and Dr. J. J. R. Macleod, received the Nobel Prize for their work. Since these two men held the patent for insulin, they stood to make an enormous sum of money by monopolizing its production. Instead, realizing the life-saving potential of the drug. Banting and macleod sold the patent to the university for one dollar each. To the people who say there would be no innovation without financial incentive, here's a prime bit of evidence to the contrary. There are few things more lucrative than medical patents, and yet these men sold the rights for next to nothing. Why, because they actually cared about other human beings, and not everyone is so perverted by the prophet motive. 

After the patent was handed off to the University of Toronto, the institution made a grave mistake. They licensed the manufacturing of the drug to Eli Lilly and Novo Nordisk. When the US gets its hands on something, it immediately ceases to be a force for good and becomes nothing more than a way to generate ever greater profits. And that's exactly what happened with insulin. The two pharma companies patented their products, essentially creating a monopoly over the life-saving drug. Eventually, a third company. Sanaffi, got in on the action, and today these three companies account for 90 percent of the insulin market. You may be thinking Oka cool, so there's at least some competition well, not really. Here are some graphs plotting the price history of drugs from these companies. Notice anything, the prices for their respective drugs have increased at exactly the same rate, not at similar rates, at exactly the same rate. 

That's not competition. That's collusion. The Insulin Giants are working together to ensure that they all make as much money as possible. 
Well, that's horrible. But surely someone could just make a generic version of insulin right that would force the Big Three to lower their prices. In theory, sure, but here's the thing about patents. If you hold a patent for a particular drug, no one else can produce that drug for a certain period of time. When that time is nearly up, you can simply make a small change to the formula, refile the patent and boom. You've just secured your monopoly for another 20 years. That's exactly what the big insulin producers have been doing, and here's the absurd part. You don't even need to improve the product, you just need to change it, and you need to be able to prove that it's not objectively worse. Patent law is completely broken, and that's part of what has allowed the insulin giants to maintain their stranglehold and keep inflating their prices. While Americans are literally dying over the lack of a drug that was intended to be made available for even the poorest people around the world. 

It should come as no surprise that between 2 thousand and five and 2015 78 percent of drug patents were not for new drugs, but for slightly modified versions of existing ones in order to extend their patents. This practice, paired with the fact that the FDA does not regulate drug prices, has made the US a wonderland for exploitative corporations and predatory institutions. The manufacturer can charge 1 thousand dollars a month for insulin. A hospital can charge 100 bucks for a single IV bag that's worth maybe a dollar. Private insurance companies can make it nearly impossible to find in- network doctors forcing you to pay absurd out-of- network rates. They can set insanely high deductibles which will guarantee a healthy profit for the insurance company while threatening even financially stable Americans with bankruptcy. 

And of course this insurance is tied to your employment. So if you get laid off because oh. I don't know a global pandemic that we completely refuse to address, you'll be paying outof pocketcket for everything. 

This system is not built with the well-being of American citizens in mind. Its sole purpose is to monetize the suffering of 100 of millions of people. When the profit motive is the driving factor, nothing else matters, everything is beholden to the dollar. This is why insulin is ten times more expensive in the US than anywhere else. This is why scumbags like Martin Shkreli can raise the price of a drug by 5 thousand percent overnight. It's why so many Americans go bankrupt trying to pay medical bills. It's why we die of preventable causes. It's why our sick refuse to get treatment because they know they can't afford it. As long as the pharmaceutical industry is allowed to operate without oversight, they will continue to raise prices until there's not a single American who can afford their drugs. Unlike the men who discovered insulin, the ones who peddle it today don't care about their fellow human beings. All they care about is making money. We need to take a look around, realize that our healthcare system is the worst of any developed nation, and demand that those in power drag our country into the 21 St. Century. There is no reason for this amount of suffering in the richest nation on earth.