Some US pharmacies are selling their entire inventories to "gray" marketeers, who make enormous profits by buying hard-to-find drugs and re-selling them at huge mark-ups, a joint Congressional investigation has found.
Moreover, prescription drugs had leaked into the gray market through pharmacies in 69% of the distribution chains examined for the probe. "Instead of dispensing the drugs in accordance with their professional duties, state laws and the expectations of their trading partners," the pharmacies had resold them to gray wholesalers, says the report of the investigation, which was begun last autumn by Representative Elijah Cummings, ranking member (Democrat) of the House Committee on Oversight and Government Reform.
Pedigree and price information collected by the investigation for five different short-supply injectable drugs showed similar patterns of leakage and aggressive price mark-ups. For all five drugs, units normally costing $10-$20 were regularly marked up to prices of $200 or more while they travelled through the gray market, the members of Congress found.
"By the time the gray market has done its work, a cancer drug that originally cost $10 can cost $500 or even $1,000," said Senator Jay Rockefeller IV, chairman of the Senate Committee on Commerce, Science and Transportation, who conducted the investigation with Rep Cummings and Senator Tom Harkin, chairman of the Senate Committee on Health, Education, Labour and Pensions (HELP).
"These gray market companies seen to know when drugs are in shortage, even before the hospitals do. And they always seem to be able to get their hands on short-supply drugs, even when authorised prescription drug distributors don't have them in stock," said Sen Rockefeller, opening a Senate hearing on the problem last week, held as part of the Congressional probe.