Affordable Drugs: Saving Money by Splitting Pills
One of the least appreciated cost-savers in medical treatment is the simple act of splitting pills. Suppose you're a U. S. citizen with depression who needs to take Lexapro brand of escitalopram oxalate, a commonly prescribed antidepressant, at a typical starting dose of 10 milligrams (mg) per day. Let's figure out how much your treatment will cost, both by month and by day.
Isn't that amazing? And it's not just an isolated example. If you do a similar analysis for many other drugs, you'll find that taking half of a double-strength pill costs substantially less than taking all of a regular-strength pill. Or another way of saying this is that the cost of a month's treatment is driven more by the number of pills involved than by the total number of milligrams taken.
Is this an accident of pricing? Should we be whispering about this? Is this pulling something over on the drug companies? Hardly. If you think that multi-billion-dollar companies trading on the New York Stock Exchange make pricing mistakes, then I've got some choice swamp-land in Florida I'd love to sell you.
So why would drug companies create these pricing mismatches (read: opportunities)? To understand this, let's walk through two prescribing scenarios. First, suppose a doctor is prescribing Lexapro to a patient who is lucky enough to have drug insurance. The patient pays a predetermined co-payment for each month's worth of medication, so he or she has the exact same out-of-pocket expense whichever way the prescription is written. So will the doctor write for thirty 10-mg pills or fifteen 20-mg pills?
Now here's the second prescribing scenario. Joe Workingman has no drug insurance and has to shell out cash to pay for the full price of medication. The doctor feels that 10 mg daily of Lexapro is needed. This time, the doctor prescribes fifteen Lexapro 20-mg pills per month, instructing the patient to take a half-pill per day. Medically, there is no loss of efficacy. The patient is pleased to pay less money. The doctor is a hero for being thoughtful and clever. Because the doctor still prescribed the same product, the drug company is happy. (The drug company would rather get half their price than nothing. Besides, they've already priced this scenario into their drug.)
In the author's practice there are some pill-splitting overachievers who even manage to break quadruple-strength pills into quarters. Imagine the savings in doing that.
In fact, the only obstacle to saving the patient money is if the drug company puts their product into capsules, because capsules can't be split. Would a drug company do such a mean-spirited thing? You betcha.
Lexapro was the sixth so-called serotonin-reuptake-blocker to come on the market, so it had to compete with all the earlier drugs in its class. But the first serotonin-reuptake-blocker to come on the market had first-mover advantage and was able to retain market-share even after the competing products arrived. This first-mover was the world-famous Prozac brand of fluoxetine, made by the Eli Lilly Company.
So what did Lilly do after competing products appeared? They stone-walled the consumer by never ever putting their product into anything other than a capsule. Moreover, for the entire time their product was still patent-protected, they never produced a higher-strength capsule. So if you needed a higher dose of Prozac, you had the honor of paying for two or three capsules per day. Why did they choose such a consumer-unfriendly approach? Because they could. (Everyone now turn toward Indianapolis and wave to the nice people at Lilly.)
My medical students look at me strangely when I start talking about publicly traded companies and market forces while I'm supposed to be teaching them about medicine. But the way I look at it, if you don't understand market forces, then you'll never understand why things in medicine are the way they are.
(C) 2005 by Gary Cordingley