GAO: Drug Companies Are Cheating the Military-Industrial Complex​

A vital element in keeping the peace is our military establishment's access to pharmaceuticals, but according to a new study from the U.S. Government Accountability Office, drug companies are overcharging the Pentagon, on average, by 50 percent on generics, and 60 percent overall. Way to support the troops!

This conjunction of an immense military establishment and a bunch of greedy pharmaceutical company parasites is new in the American experience. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. As John Tozzi writes for Bloomberg Businessweek:

It's a bit of a shell game. Discounts in one program are often offset by higher prices somewhere else—for either the government or private insurers or both.

The GAO makes this clear. Theoretically, the government could save billions if it got the Medicaid rate for all the pharmaceuticals it buys—69 percent lower than Medicare gets for brand-name medicines—if drugmakers didn't raise other prices to make up for the lost revenue.

That notice about private insurers is perhaps especially worth noting.

While, true, we must guard against the acquisition of unwarranted expenditures, whether sought or unsought, by the Military-Industrial Complex, drug company arbitrage is actually pandemic within the whole healthcare industry. You know it by the customer friendly "sliding scale" and doctors, pharmacists, insurers, alcoholic Pfizer sales associates, and so on, know it as the "payer mix."

But that's the price of freedom, and freedom is what we fight for.

[photo via Staff Sgt. Andrew H. Owen, Virginia Guard Public Affairs]