According to the study, the Medicare program has paid an average of 30% more than Medicaid (the program covering people on low incomes) for the same prescription drugs.
The study especially focused on costs of providing prescription drugs to around six million ‘dual eligibles’ – people who qualify for both Medicare and Medicaid. These dual beneficiaries were switched to Medicare when the Medicare prescription drug benefit (known as Part D) was introduced in January 2006.
Johnson & Johnson reaped the largest windfall, at $615 million, which includes over $500 million in additional revenue from sales of the anti-psychotic Risperdal (risperidone), while Bristol-Myers Squibb profited by around $400 million, including over $200 million in additional revenue from sales of its heart-attack and stroke drug Plavix (clopidogrel).
The study revealed that overall around 29 major drugmakers producing the 100 drugs used most often by dual-eligibles benefited hugely from the Medicare program.
PharmaTimes has quoted House Committee chairman Henry Waxman, as saying: “This is an enormous giveaway and it has absolutely no justification. The privatization of Medicare Part D is a great deal for the drug companies. And it’s a great deal for the private insurers. It’s the taxpayers who are taking it on the chin.”