"Americans pay more for health care than anyone else in the world, and disparity in drug pricing is one of the reasons why."

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An exit visa out of Bumper Sticker Land, perhaps past Obamacare
By Jim Galloway, May 3, 2014

Originality is the exact opposite of politics, where the essential purpose is to merge with the largest herd possible.

In poll-tested campaigns, innovation is relegated to the more superficial elements. And so we have TV ads that feature crying babies, old station wagons, and booming cannons.

Which means that when a truly unique bit of substance surfaces — unsuitable for any bumper sticker smaller than a billboard, incapable of being compressed into a 10-second sound bite — it is worth some attention. Regardless of the source.

Art Gardner, an Atlanta patent attorney, is conducting a quixotic, underfunded Republican campaign for U.S. Senate. His decision to position himself as a “socially tolerant” conservative, who says gay marriage is an inevitable fact, should give you a measure of his chances.

But Gardner has a proposal for lowering health costs in the United States that may deserve to survive the May 20 primary, even if he doesn’t.

Better yet, while Gardner is on record as being opposed to the Affordable Care Act, his idea has nothing to do with Obamacare. It might, in fact, take some of the starch out of that never-ending debate.

But again, this requires us to venture beyond Bumper Sticker Land. “It takes me three or four minutes to describe it to a room,” Gardner said. “They’re all over it then.”

Let’s start with one of the prescriptions pressed on Gardner – and perhaps you — by a doctor. Crestor is a drug designed to reduce cholesterol, and costs $7.50 a tablet in the United States – maybe $6.50 if you have decent insurance.

In Canada, the same tablet can be had for $1.78. In the rest of the developed world, the price varies, but is usually under $2.

Americans pay more for health care than anyone else in the world, and disparity in drug pricing is one of the reasons why.

Gardner, who has a rather wide libertarian streak in him, emphasizes that this has nothing to do with the invisible hand of the market. There is no such thing when it comes to patented medicine – not in Canada, not in Europe, and not in the United States.

”The idea behind a patent is there’s not a free market. We’re giving you the opposite of a free market to reward you for the substantial investment required to develop a new drug,” said Gardner, who has been involved in intellectual property law for the last quarter century.

In other countries, drug companies are able to maintain their competition-free arenas granted by patents, but government regulates the prices they can charge.

No so here. “We in this country abhor price controls. We like a free market. Our society doesn’t want any sort of government interference. We’re taking a hands-off approach,” Gardner said.

And so? “The drug companies can’t charge what they need in the other countries. Take Crestor. They probably need $3 per tablet to make a good profit worldwide. But since they can only get $1.78 in Canada, and similar prices in the other G-7 countries, they’ve got to charge a lot more than $3 in the U.S. to make up for it,” Gardner said.

So Americans are subsidizing artificially low prices throughout the civilized world. The cost of prescriptions drugs is so low in Canada – and elsewhere — precisely because you’re paying more here.

“Intellectually, I can rationalize and justify why we should pay a lot more for medicine than Africans who are living on 50 cents a day,” Gardner said. “But the Germans? It’s absolutely crazy that we should pay a lot more so they can pay a lot less.”

Gardner’s solution isn’t the stuff that normally sets a U.S. Senate race on fire. He wants Congress to make a change in U.S. patent law, so that a drug company’s 20-year lock on its unique product could be challenged if its U.S. price is 25 percent higher than elsewhere in the G-7. And the patent could be lost if the U.S. price were 50 percent higher.

The patent attorney said this would force drug companies to negotiate higher prices abroad. “They will be forced to go to those other countries and say, ‘We can’t screw the Americans anymore,’” he said.

Gardner said his idea wouldn’t neutralize the Obamacare issue, but it might lower the temperature of the argument. “The overarching problem with health care is not how you administer the insurance,” he said. “It’s how much it costs. If you could lower the cost of health care in total in America, we could figure out a way to pay for it that people would like.”

Should Gardner fall on the third Tuesday in May, he’s hoping that a surviving Republican will pick up his baton on drug pricing. But he also thinks it might have some bipartisan allure.

Branko Radulovacki, an Atlanta psychiatrist and Democratic candidate for U.S. Senate, met Gardner at a forum this spring, where the patent attorney had made his pitch.

“Dr. Rad” wasn’t ready to endorse it, but didn’t scoff, either. “It’s a creative idea. It’s worth further consideration. I can applaud him for thinking of a different approach,” said Radulovacki, who writes many a prescription himself.

Now if only Gardner could find a way to get Michelle Nunn’s ear….
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