Lawmaker Ramps Up Investigation of Gray Market Rx Distributors
Rep. Elijah Cummings (D-Md.) continues to seek information for an investigation he launched last month into so-called gray market distributors that sell drugs in short supply at prices significantly higher than standard retail, CQ Today reports (Ethridge, CQ Today, 11/2).
Last month, Cummings sent a letter requesting information from Superior Medical Supply in Colorado; Allied Medical Supply and Reliance Wholesale in Florida; and Premium Health Services and PRN Pharmaceuticals in Maryland (Lee, Modern Healthcare, 10/5).
The letters cite a recent Associated Press report claiming that drug shortages were linked to at least 15 recent patient deaths and that drug distribution companies are selling drugs for various types of illnesses at significantly marked-up prices. In some cases, the sale price is up to 80 times more than the normal price.
Cummings asked the distributors to explain their markups on various drugs and gave them two weeks to respond. Although there currently is no federal law against price gouging on medicines, Cummings noted in an interview that the practice "ought to be criminal" under the current circumstances. As part of the probe, Cummings has established an Internet tip site to gather information about price gouging on drugs that are in short supply (Johnson, AP/San Francisco Chronicle, 10/5).
Four of the companies have responded to Cummings' request. However, Superior Medical Supply is not cooperating, according to his staff. An attorney for Superior told Cummings' office that they would cooperate with his investigation, but they have not provided any of the requested documents and have stopped returning phone calls. Cummings pushed the deadline to Nov. 14 for Superior to respond to his request (Lee, Modern Healthcare, 11/2).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.