All Things Pharmaceutical

The White House recently launched a task force aimed at addressing the nation’s opioid addiction crisis, headed by New Jersey Gov. Chris Christie.1 According to the U.S. Department of Health & Human Services, the majority of drug overdose deaths that occur today involve an opioid.2

Prescription drugs are a nuanced example of how positive innovations can have negative consequences. Certainly new medications developed over the past three decades have contributed to healthier people and longer lifespans. But they are not without drawbacks.

The number of reported drug side effects has increased by five times since 2004. The proliferation of drugs prescribed to treat rheumatoid arthritis, psoriasis, multiple sclerosis and diabetes are among those with the most challenging side effects.3

It’s worth observing that many things come with possible drawbacks, even those that may be entirely appropriate for you — like diabetes medication. The same holds true when it comes to decisions related to finances. While many financial vehicles, including insurance products, feature benefits to help enhance your situation, it’s important to understand the possible downsides as well. If you’re considering purchasing insurance now or in the future, please allow us to help you fully understand both the advantages and disadvantages that may be associated with the purchase.

Perhaps even more disconcerting than negative side effects to medications is that many people aren’t taking full advantage of today’s pharmaceutical wonders. A recent study found that up to three out of 10 prescribed medications are never filled and about half of those filled for the treatment of chronic diseases are not taken the way they’re supposed to be. While those patients may think that’s not a big deal, collectively speaking, this lack of adherence causes around 125,000 deaths a year and at least 10 percent of hospitalizations. If you’re concerned about rising medical costs, consider this: Poor medication compliance costs the American health care system between $100 billion and $289 billion annually.4

Speaking of expenses, the country anxiously awaits to see if the new presidential administration and Congress will be able to slow the rising cost of medications. It appears there will be a loosening of regulations associated with streamlining approvals of new drugs, and many insiders are in favor of allowing Medicare to negotiate volume pricing with drug manufacturers. However, there are still instances of medications that have been on the market for quite some time, having more than recouped their research and development costs, making substantial price hikes for the sake of increasing profits.5

Of course, a price reduction could actually increase the problem of opioid addiction, making these drugs more affordable. One of the controversial mandates of the Affordable Care Act is coverage for 10 essential benefits — one of which is for substance abuse services.6 Ironically, the combination of reducing the cost of prescription drugs and repealing the Affordable Care Act could worsen the epidemic of opioid addiction. It just goes to show nothing is simple. For every positive action, there could be negative consequences, so all ramifications should be considered. And so it goes for financial decisions as well.


Content prepared by Kara Stefan Communications

1 Jill Colvin. U.S. News & World Report. March 29, 2017. “Trump, Christie Pledge to Combat Nation’s Opioid Addiction.” Accessed April 30, 2017.

2 U.S. Department of Health & Human Services. June 2016. “The Opioid Epidemic: By the Numbers.” Accessed April 30, 2017.

3 Matthew Wynn and John Fauber. Milwaukee Journal Sentinel. March 17, 2017. “Analysis: Reports of drug side effects increase fivefold in 12 years.” Accessed April 30, 2017.

4 Jane E. Brody. The New York Times. April 17, 2017. “The Cost of Not Taking Your Medicine.” Accessed April 30, 2017.

5 Knowledge@Wharton. March 10, 2017. “How Will Big Pharma Fare Under Trump?” Accessed April 30, 2017.

6 NBC News. Feb. 22, 2017. “Opioid Addicts Worry About Losing Obamacare.” Accessed April 30, 2017.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.