His Cancer Meds Were Nearly $1K A Pill. How Did That Happen?

Summary

Fresh Air Episode Summary: "His Cancer Meds Were Nearly $1K A Pill. How Did That Happen?"

Host: Dave Davies
Guest: David Armstrong, Senior Reporter for ProPublica
Release Date: May 14, 2025

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I. Introduction: A Personal and Investigative Journey

David Armstrong, a seasoned investigative reporter for ProPublica, shares his deeply personal journey intertwined with his professional investigation into the exorbitant costs of cancer medication. Diagnosed with multiple myeloma in 2023, an incurable blood cancer, Armstrong found himself reliant on Revlimid, a drug priced at nearly $1,000 per pill. This personal stake fueled his determination to uncover the mechanisms behind such high drug prices.

“I couldn’t believe that nearly $1,000 a pill is what my health plan was paying for this drug. So I wanted to know how this was possible.”
— David Armstrong [05:31]

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II. The Origins of Revlimid: From Thalidomide to a Cancer Breakthrough

Armstrong delves into the history of thalidomide, a drug initially developed in the 1950s by a German pharmaceutical company to treat morning sickness in pregnant women. Tragically, thalidomide caused severe birth defects, leading to its ban in most countries by the 1960s.

“Thalidomide was developed... it was sold... over the counter... It was incredibly potent... caused severe birth defects.”
— David Armstrong [06:51]

Ironically, the very property that made thalidomide dangerous—its ability to inhibit blood vessel growth—became beneficial in treating cancer tumors. This repurposing marked the birth of Revlimid, a derivative developed by Celgene, designed to combat multiple myeloma by starving tumors of necessary blood supply.

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III. Celgene’s Strategic Maneuvers: Patents and Pricing

Celgene, initially a struggling pharmaceutical company, recognized the potential of thalidomide as a cancer treatment after witnessing promising results in Arkansas. However, they faced a significant challenge: Celgene did not hold the patent for the active ingredient in thalidomide due to its age. To circumvent this, Celgene developed Revlimid, a slightly modified version of thalidomide, allowing them to secure a more robust patent.

“Celgene started to explore alternatives to thalidomide... ended up developing Revlimid.”
— David Armstrong [15:14]

Upon its release in 2005, Revlimid was priced at an astonishing $55,000 annually, a figure far exceeding initial market expectations. In stark contrast, the manufacturing cost per pill remained approximately 25 cents, highlighting a massive markup.

“The cost to manufacture Revlimid is approximately 25 cents a capsule.”
— David Armstrong [15:47]

Despite criticism, Celgene justified the high price by citing research and development expenses, even though ProPublica's investigation revealed that the $800 million spent on Revlimid's development was minimal compared to its $100 billion in total sales.

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IV. Maintaining Monopoly: Tactics Beyond Patent Expiry

Celgene employed strategic measures to extend its monopoly on Revlimid beyond the original patent period. By controlling the drug's distribution through FDA-mandated safety programs—designed to prevent birth defects—Celgene ensured that generic manufacturers struggled to compete.

“They controlled the distribution... Celgene refused to sell it to [generic companies], maintaining their market grip.”
— David Armstrong [17:19]

Regulatory bodies like the FDA and Federal Trade Commission became aware of these tactics. However, limited enforcement capabilities and settlements delayed generic competition until 2022, keeping prices artificially high until then.

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V. Price Hikes and Internal Pushback

Celgene demonstrated a pattern of arbitrary price increases to maximize revenues. For instance, in 2014, a 9% price hike was implemented when Revlimid sales fell short. In 2017, after abandoning a promising drug for Crohn's disease, the price surged by 20%.

“They used Revlimid to boost overall revenues... described it as a piggy bank.”
— David Armstrong [20:02]

Internal dissent surfaced when a Celgene official filed a whistleblower complaint against these price hikes, revealing a corporate culture indifferent to ethical considerations.

“The CEO admonished her, said, ‘what's the worst that's going to happen? A bad tweet.’”
— David Armstrong [21:10]

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VI. Broader Implications: The American Drug Pricing Dilemma

Armstrong expands the discussion to the broader issue of why Americans pay more for prescription drugs compared to other wealthy nations. He attributes this to the fragmented U.S. healthcare system, lacking a single payer, which complicates price negotiations.

“We have a very fractionalized system... it's very hard to negotiate a price when everybody's doing their own negotiating.”
— David Armstrong [23:10]

Amidst this landscape, political efforts emerge to curb drug prices. President Trump’s executive order aimed to compel pharmaceutical companies to offer lower prices comparable to other countries. However, Armstrong emphasizes the challenges ahead, citing potential legal battles and entrenched industry resistance.

“The pharmaceutical lobby is not to be underestimated... this will be a tough fight.”
— David Armstrong [25:33]

Comparatively, the Biden administration's measures, though more modest, faced skepticism regarding their impact, with projections of only modest price reductions.

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VII. The Role of Middlemen and Industry Defenses

The discussion also touches upon Pharmacy Benefit Managers (PBMs)—middlemen in drug pricing. While President Trump criticized PBMs for taking profits without delivering products, Armstrong highlights the opaque nature of their operations and the call for greater transparency.

“These are middlemen that set prices through sometimes secret rebates and discounts... there's been a lot of calls to eliminate the middlemen.”
— David Armstrong [27:20]

Pharmaceutical companies defend their pricing by citing the high costs of research and development. However, Armstrong counters this by referencing studies indicating that government funding plays a significant role in drug development and that companies often allocate substantial funds to stock buybacks and dividends rather than R&D.

“Government funding has been just as important... drug makers spend more on stock buybacks and investor dividends than they do on research and development.”
— David Armstrong [28:20]

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VIII. Navigating as a Patient-Reporter

Balancing his role as a patient with his investigative responsibilities, Armstrong addresses concerns about potential biases. He maintains transparency about his condition and strives to ensure objectivity, acknowledging that while his perspective has shifted, his commitment to uncovering the systemic issues in drug pricing remains steadfast.

“Being a patient changed my perspective... there's so much more research and discoveries that need to happen.”
— David Armstrong [39:35]

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Conclusion: A Call for Systemic Change

David Armstrong's investigation into Revlimid's pricing illuminates the complex interplay between pharmaceutical companies, regulatory bodies, and the healthcare system. His personal narrative underscores the human cost of these high prices, advocating for a more equitable and transparent approach to medication affordability in the United States.

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Find David Armstrong’s full investigative piece, "The Price of Remission," on the ProPublica website.

Transcript

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[Dave Davies]

This is FRESH air. I'm Dave Davies. Our guest today, David Armstrong, is a veteran investigative reporter who in 2023 was writing stories about challenges for patients in American health care when he was suddenly plunged into his subject in a deeply personal way. He was diagnosed with multiple myeloma and incurable blood cancer. He would soon be prescribed a drug called Revlimid, which is cheap to make but really expensive to buy. A single pill costs nearly $1,000, roughly the price of a new iPhone. Armstrong decided to research the development and marketing of the drug, and he discovered tactics used by drug companies to maintain monopolies on their medications as long as possible and keep price. Revlimid is one of the best selling pharmaceuticals of all time, with total sales of more than $100 billion. This is also remarkable since the parent compound in Revlimid, thalidomide, was banned in most of the world in the 1960s after it was shown to cause severe birth defects when given to pregnant women. David Armstrong is a senior reporter for ProPublica who focuses on health care. He previously reported for STAT, the online service reporting on health and medicine, as well as the Boston Globe and the Wall Street Journal, where he shared a Pulitzer Prize for coverage of the 911 attacks. His news story about Revlimid is the Price of Remission. You can find it at the ProPublica website. Well, David Armstrong, welcome to FRESH AIR.

[David Armstrong]

Thanks for having me.

[Dave Davies]

I want to begin with your illness and the drug that you need to treat it. Multiple myeloma is an incurable blood cancer. Tell us about its symptoms, the course it typically takes in the human body.

[David Armstrong]

Sure. Well, I can describe for you what happened in my situation, and every case, for every patient's a little bit different. But for me, it started with a pain in my side that wouldn't go away. It felt like for many weeks, a bad runner's cramp. And I sought out care for it and went to a doctor who thought, you know, this is probably a muscle strain. But it ended up getting worse. And one morning, I woke up, and I couldn't get out of bed. I mean, I had to grip the wall. I was in so much pain. And decided to go to the emergency room. And it was there. They did some testing, some scans. And what happens with a lot of multiple myeloma patients is the disease really impacts the bones. It gets in there with these things called lytic lesions, Creates holes in the bones, and many people don't know they have multiple myeloma until they break a bone. I talked to another patient who was golfing and took a swing in his sp. Part of his spine literally collapsed, and he went to the hospital, and that's how he found out he had this disease. So it often lurks without people knowing it's there, and it takes something fairly dramatic for a patient to discover it. So in my case, I found out that I had it and then began a course for drugs, including revlimid.

[Dave Davies]

And how long do typically patients live with this illness?

[David Armstrong]

Well, so, you know, one of the amazing things about this particular cancer is that, you know, 20, 25 years ago, it was a very grim prognosis. You know, two, three, maybe five years is what many patients lived with the cancer before passing away. That has changed dramatically thanks to drugs like revlimid in the past 10, 15 years in particular. And for many patients, you know, you can almost live with it as sort of a chronic disease. If you fail one line of treatment, there's now second, third, fourth, fifth lines of treatment. So, you know, it's many more years than it was 15, 20 years ago.

[Dave Davies]

And with the treatments you have now, what kind of shape are you in? How's your day?

[David Armstrong]

So, for me, it's pretty good. You know, I do have some side effects from the drugs I take. You know, there's things like fatigue. But, you know, most days, I feel good. I'm able to exercise fully and grateful that my cancer is in remission.

[Dave Davies]

So being the dogged reporter that you are, you decided there was a Story here in the high cost of the drug. We should note that you don't pay $1,000 a pill. Right. You're lucky to have a health plan covers it, but that's what it costs, a health plan, right?

[David Armstrong]

That's right. So, you know, when I was diagnosed with this cancer, I was in the hospital and one of the doctors said, you know, you'll get a regimen of drugs, and one of them will be a thalidomide drug. And, you know, I've covered and written about medicine for a number of years, and I said, thalidomide? How is that possible? This is a drug that does so much harm, it's, you know, it's notorious. So that piqued my interest. I wanted to know how this drug that was so dangerous became a cancer fighter. And then once I started taking it and received my first claim summary, I was really taken aback by the price. And look, I'm not naive about drug pricing. You know, I've written about healthcare for the better part of two decades. I wrote extensively about Purdue Pharma and the Sackler family and how they manipulated the Marketplace to make OxyContin appear safe and at low risk for addiction. So, you know, not naive to the ways of drug makers, drug pricing and marketing. But even with that background, I couldn't believe that nearly $1,000 a pill is what my health plan was paying for this drug. So I wanted to know how this was possible.

[Dave Davies]

You know, thalidomide is such a notorious drug. Tell us a little bit about why it was originally developed and what caused the birth defects.

[David Armstrong]

So thalidomide was developed by a German pharmaceutical company as a treatment for morning sickness for pregnant women, also to help them sleep. And it was sold in Europe, in Germany, for instance, over the counter. And there were advertisements in the UK telling women how safe this drug was. And it turned out not to be the case. Even a single dose of thalidomide was associated with birth defects. It was incredibly potent that way. And tragic, as it turned out, in more than 10,000 babies, some estimates are up to 20,000 babies, primarily in Europe, Canada, Australia, were born with some really horrific birth defects, and a large number of them died shortly after birth. And this was just a horrific scandal that rocked the developed world in the 60s and led to a number of reforms for how drugs are tested for safety, including here in the United States.

[Dave Davies]

And the thalidomide would basically cut off the development of blood vessels to the fetus.

[David Armstrong]

Yeah, the way I understand it is it deprived the fetus of new blood vessels that the fetus needed to develop.

[Dave Davies]

Right. Which is, ironically, what made it helpful in fighting cancer tumors.

[David Armstrong]

That's exactly right.

[Dave Davies]

Right. So it's a fascinating story as you tell it in the article. I mean, there's a breakthrough at a hospital in little rock, arkansas, Aided in part by a tenacious woman named beth wolmer. You want to tell us that story?

[David Armstrong]

Yeah. So ira wolmer, Beth's husband, was an interventional cardiologist in the new york area who was diagnosed with multiple myeloma in his 30s. Unfortunately for him, this was in the mid to late 1990s, when there were really few options for myeloma patients. So they. They went all over the country to different cancer centers Looking for a doctor who could promise them something more than just, you know, a couple of years. And they ended up in arkansas with a doctor named bart barlogi, who was gaining a reputation for trying just about anything to help multiple myeloma patients. And people, literally from all over the world were going to his clinic in little rock. So the womers arrived there, and unfortunately for ira wolmer, he wasn't getting better. They did some stem cell transplants with him, but he relapsed after each one of them and was just getting sicker and sicker. But beth woolmer wouldn't quit. You know, she would read medical journals all day long. She'd call researchers all over the world. She was, you know, bound and determined to find anything that would help her husband. And it was in the course of doing that that a researcher told her about the work of judah folkman in boston, who had a theory that if you could block blood vessel growth, you could starve tumors of what they needed to grow. And his lab was studying thalidomide. One of his researchers was deep into studying this and actually published some work about it. So when beth finally connected with him, he said, try thalidomide.

[Dave Davies]

And she went to balogi, the doctor, and he said, try it.

[David Armstrong]

Yeah, I mean, you know, at the time, you know, nobody really thought that this would work. I mean, it was. It was an idea that did not have a lot of people endorsing it. But, you know, Ira wolmer was in a desperate strait, and, you know, bart borlogi, you know, had a reputation for trying things. So even though he might have been, you know, somewhat skeptical about it, he agreed to try it on both ira wolmer and two other patients. And unfortunately, it didn't work for ira wilmer. He didn't get better, and he died a few Months later. But one of the patients, a guy named Jimmy, showed a miraculous recovery. I mean, he was at death's door. And all of a sudden, the cancer markers in his blood started going down. And the folks in Arkansas realized that for the first time in really forever, they had a potential drug that would help multiple myeloma patients.

[Dave Davies]

So the doctor who was treating Jimmy, this multiple myeloma patient, I guess, was involved in a study of, was it 89 patients or so? I guess. And the results showed what?

[David Armstrong]

Well, so after the response that Jimmy experienced with the drug, they immediately launched a larger trial with these 80 something patients, as you mentioned. And you have to keep in mind that it had been 30 years since any kind of treatment for multiple myeloma had been approved. And even that was a chemotherapy drug that was just sort of blunt force, you know, killed the good cell, the bad cells. It's a very hard drug to tolerate. And the success rate for that drug, which was followed by a stem cell transplant, you know, was. Was a mixed bag. So there was tremendous excitement about the possibility of a drug, first of all, that you could just swallow and that might help multiple myeloma patients. So they did this study, and they found these were patients who were high risk and really running out of options. And one third of them showed declines in cancer in their. In their blood work, which was something that doctors in the specialty had never seen before. It was an incredible response.

[Dave Davies]

So it turns out there's a company called Celgene that held the patent for thalidomide. What did this discovery do to their financial position?

[David Armstrong]

Yeah, so Celgene was a small struggling company in northern New Jersey who was studying thalidomide with the idea that it would be a treatment for AIDS patients who were getting it in the black market from places like Brazil and using it to treat a condition associated with AIDS where patients would lose a tremendous amount of weight, a dangerous amount of weight. And they thought that there'd be a market for that. They, interestingly enough, to get FDA approval. The FDA approved it for a complication of leprosy. Doctors all over the world have been using it for leprosy patients to treat this condition that often causes painful skin lesions and other things. But, you know, there's only, you know, in the United States at the time, you know, hundreds of leprosy patients, a tiny, tiny market. But when the Arkansas results came in, the people at Celgene immediately realized that this was a cancer drug. And that was a game changer for the company.

[Dave Davies]

You know, it's interesting that when they were using the thalidomide based drug to treat AIDS patients, they kept the prices low. And there was an interesting explanation for this which did not apply to the multiple myeloma patients. You want to explain that?

[David Armstrong]

Yeah. So when the drug was initially approved, and again technically for leprosy, but once it's approved, doctors are free to prescribe it. Off label, they call it, for other indications. And the CEO at the time was speaking to at an investor conference and said, you know, look, we kept the price low because that's what you do if you don't want protesters at your door. In other words, the AIDS community was very active. They would protest if there were developments that they thought ran contrary to the interests of the AIDS community. So they were concerned about that. And he said to the investors at the time, we have a lot of.

[Dave Davies]

Room for growth now because multiple myeloma patients wouldn't protest.

[David Armstrong]

You know, essentially that's the implication. You know, one of the executives at Celgene said at the time the company had the impression that cancer patients would pay whatever it takes.

[Dave Davies]

So we were saying that there was this discovery that thalidomide, this drug, which had such a terrible reputation for causing birth defects, proved effective in treating multiple myeloma. And the patent was held by Celgene, this little pharmaceutical company. And it's interesting you write that, I guess not all patents are created equal. Celgene's patent was limited in a way. How and why does this matter?

[David Armstrong]

So the problem that Celgene had with the thalidomide patent is they did not have a patent for the active ingredient. And that's because thalidomide was such an old drug. It was discovered and developed in the 1950s by a German pharmaceutical company. And for drug makers, the active ingredient is a really important patent. So Celgene started to explore alternatives to thalidomide. And there was two reasons for that, at least two. One is they hoped to find a drug that didn't cause birth defects and a drug that they could patent in a more influential way. So they started studying analogs of thalidomide. And this is just a slightly tweaked version of the parent compound. You know, you move an atom here, do this here in the chemical structure, and that's how they ended up developing Revlimid.

[Dave Davies]

And when they finally released the drug in 2005, how expensive was it?

[David Armstrong]

So in 2005, they released the drug with a price of $55,000 a. And that really surprised a lot of people, including the analysts who follow the company. They thought that it would be half as much as that. But the company did its own due diligence, and that was a price they thought that they could justify, and it ended up being a price that people paid.

[Dave Davies]

And what did it cost to manufacture a pill?

[David Armstrong]

So the cost to manufacture revlimid is approximately 25 cents a capsule. And that was true at the start, and it was true through most of the history of the drug. And that's according to a Celgene official who testified in a court case.

[Dave Davies]

That heavy cost drew criticism, of course, including from some doctors treating multiple myeloma patients. How did the company respond to complaints that this was just too expensive? I mean, the typical claim is, look, we spend a lot on researching and developing these drugs. I mean, that really wasn't the case here, was it?

[David Armstrong]

No. I mean, there's certainly costs associated with developing the drugs. And, you know, Celgene should be given credit for developing this drug. It's not easy to get FDA approval for a drug, and running clinical trials is hard business, you know. That being said, the company estimated about $800 million was spent to develop Revlimid, a few hundred million more to test it in clinical trials for other cancers. You know, when you consider the revenue in excess of $100 billion, you know, it's a fairly small amount in terms of the research and development costs for this particular drug.

[Dave Davies]

So when Celgene creates Revlimid and it's an effective treatment for this disease, they have to deal with the fact that, you know, you don't keep an exclusive patent forever. There are laws that allow generics to eventually come in, provide competition and lower prices. This company was remarkably effective installing that. How did they do it?

[David Armstrong]

They did it by turning the most dangerous aspect of this drug, the fact that it potentially causes birth defects, into an asset. They controlled distribution because the fda, in approving the drug, mandated a safety program. They wanted to make sure that only the patients who needed it got the drug. They didn't want to see somebody accidentally take it and get pregnant and develop a birth defect. They were extremely concerned about that. So they controlled the distribution. And that meant that generic companies who wanted to develop a competing product had to acquire Revlimid from Celgene because you have to test your generic product against the brand name to prove to the FDA that they're essentially the same thing and safe. They couldn't get the drug from Celgene. Celgene simply refused to sell it to them, and they controlled the distribution. So that enabled them to really maintain a grip on the market for a number of years beyond the exclusivity period that the FDA granted.

[Dave Davies]

And the FDA and the Federal Trade Commission became aware of this, took some steps, but somehow were ineffective. Right.

[David Armstrong]

They became aware of it. The FDA at one point ordered or directed Celgene to sell to a generic competitor. The FDA didn't have any enforcement ability. However, the Federal Trade Commission did do a lengthy investigation, and the staff proposed taking legal action against Celgene, but that didn't happen. The company promised that they would sell the drug. The commissioners that are needed to approve litigation thought that they were going to sell the drug and were not interested in pursuing litigation at that time. And that enabled them for several more years again to have this market all to themselves without any competition.

[Dave Davies]

So what did that mean for Celgene?

[David Armstrong]

In the end, Celgene still had a monopoly on the marketplace, and they maintained that monopoly until 2022. In 2015, they settled with one of the generic companies who was involved in litigation with them. And that settlement required the generic maker to stay out of the marketplace until 2022. And even when it comes into the marketplace in a very limited way, less than 10% of the market, and what's the effect of that? The price still stays high. There's not unfettered competition with generics until next year, 2026. That's right.

[Dave Davies]

For a drug that was released in 2005. So that's a long stretch. When Celgene kind of had the ability to raise the cost of the drug at its own discretion. What did you discover about the price hikes?

[David Armstrong]

What we found is the company, in certain situations, used Revlimid to boost overall revenues. There was a situation in 2014 where Revlimid sales were not up to what the company expected, and a memo was sent out saying, we need a price increase. Another situation in 2017 where they had a drug that was very promising for another condition called Crohn's disease failed, and they abandoned that project. And the day they abandoned that project, they raised the price of Revlimid 9%. You know, we described it essentially as a piggy bank. They could tap Revlimid whenever they needed to. And there was really no regulator or governor on the price increases. It was really up to the company.

[Dave Davies]

And you found some evidence of objections even within the company? Right?

[David Armstrong]

We did. 2017, they raised the price 20% during the year. And one of the company officials filed a whistleblower complaint. And in her complaint, she said she was at a meeting and she objected to these price increases. She said it was just too much. And she said the CEO admonished her, said, what's the worst that's going to happen? A bad tweet. And that's how she said they viewed these price increases.

[Dave Davies]

So that was the company. The CEO's response, a little complaining, don't worry about it. Yeah.

[David Armstrong]

Might be a bad story here or there or a bad tweet, but, you know, why wouldn't we take the increases is what she quoted him as saying.

[Dave Davies]

We need to take another break. Here we are speaking with David Armstrong. He is a senior reporter for ProPublica. His new story about the high cost of the cancer drug Revlimid is the price of remission. He'll be back to talk more after this short break. I'm Dave Davies, and this is FRESH air.

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You know, along with the story that you've just published about the price of Revlimid, you have a companion story which asks the question, why do Americans pay more for prescription drugs? And you're right that Americans do pay more than other wealthy countries for the same drugs. Why?

[David Armstrong]

Well, I think the big reason is that here in the United States, we do not have a single payer of health care. We're one of the few countries where the government is not the provider or the sole provider of health care, and that makes it hard to negotiate. We have a very fractionalized system in terms of the number of payers. You know, there's hundreds and hundreds of private payers, even among the government. There's Medicare, Medicaid, the Veterans Administration, Department of Defense, who are all big payers. So it's very hard to negotiate a price when everybody's doing their own negotiating, right?

[Dave Davies]

Well, you know, President Trump has announced that he's assigned an executive order which he says will require pharmaceutical companies in the United States to give Americans the lowest price they charge to other countries, which he says are much cheaper in Europe, for example. And he says that'll have a big impact. What's your sense of what we might expect from this effort?

[David Armstrong]

Well, you know, I think first of all, the administration should be given some credit for bringing attention to this issue and pledging to do something about it. I think the executive order didn't have a lot of specific mechanisms for how this is going to be accomplished. A lot of it will be down the road. They talk about getting together with the drug companies and discussing prices of certain drugs. And if that doesn't work, they could turn to rulemaking, which would probably be Medicare and Medicaid programs, instituting rules on what prices they will pay for drugs. But, you know, a lot of it is the devil's in the details here, and I think we'll have to see. It's a complicated thing to get these prices down. You know, that doesn't even address the issue of what drug prices are launched at. You know, cancer drugs in particular are being launched at prices that are so expensive that, you know, you have nowhere to go when you start negotiating a decreased price because they started so high. So we'll have to see.

[Dave Davies]

Right. You know, there's been a lot of discussion of the federal government negotiating for better prices for Medicaid and Medicare, where the government is, in fact, the one buying the product. In the case of, you know, controlling transactions among two private entities, Right. I mean, an American drug maker and American buyers and those who buy in Europe. You're really talking about price controls, aren't you?

[David Armstrong]

I think you can make the argument it is. And the reality with, you know, things like this executive order is that whatever comes from it in terms of real concrete actions is likely to be challenged in court. You know, the Trump administration ran into this problem the first time around. They proposed a very modest, I think, idea where they would test out drug pricing for some of the Medicare drugs that are administered in a doctor's office. And that, you know, was held up by the courts. And then the first administration expired. So it's going to be a fight. You know, the pharma lobby is not to be underestimated. You know, they spend billions of dollars on lobbying or millions, I should say. So this will be a tough fight trying to wrangle prices down.

[Dave Davies]

Right now, the Biden administration has claimed credit for reducing prices of certain widely used drugs. I think particular diabetes medications. Is that similar different here?

[David Armstrong]

The Biden effort, frankly, was much more modest, at least in execution. The Trump administration is promising, you know, greater results. We'll have to see. But, you know, essentially the Inflation Reduction act that was from the Biden administration allowed Medicare some limited ability to negotiate prices on the first year 10 drugs, the next year 15 drugs. But the Congressional Budget Office found that those impacts are going to be very modest. You know, it's not going to change the game, essentially.

[Dave Davies]

You know, one of the things President Trump said when he was talking about his new executive order is that he plans to cut out the, quote, middlemen in drug purchasing who make a fortune without ever offering a product. I guess these are presumably the pharmacy benefit managers whose role I've read about but don't really understand. Is he right?

[David Armstrong]

Well, you're not alone in understanding that. It's very opaque, it's very secretive. Lots of people have tried to crack the code there, and it's difficult. These are middlemen that set prices through sometimes secret rebates and discounts back to the drug maker. And on the other side, they have the health insurer. And a lot of people have called for transparency in pricing. What is the actual price, taking out all of these rebates and other things that the middlemen put in. So there's been a lot of calls to eliminate the middlemen. President Trump said something like, you know, they're taking money out of the system without actually making a product. And I think there's some truth to that. But again, this is a very entrenched interest in the drug pricing arena, and it'll be hard to do.

[Dave Davies]

You know, the drug companies say in their defense that, yes, they make a lot of money, but that's the cost of doing all the expensive research and testing that it requires to get new medications to innovate. How well does their defense stand up?

[David Armstrong]

Well, you know, the fact of the matter is, and there's been some studies about this, you know, industry funding of research is certainly important, but government funding has been just as important. You know, 300 and something drugs approved by the FDA in the last decade, all but two of them had some element of government funding in them. So there are some studies out there suggesting that the industry estimates of what it costs them to bring a drug to market. What they spend on research and development have been inflated and perhaps most damning. The House oversight committee did a study that found drug makers spend more on stock buybacks and investor dividends than they do on research and development.

[Dave Davies]

You know, I've always wondered when. I mean, like, in the case of Revlimid, I mean, the medical breakthroughs, the research breakthroughs occurred here, I guess, at a hospital in Arkansas and doctors in Boston, what kind of credit or compensation did they or their institutions get for this breakthrough drug?

[David Armstrong]

So the doctors in Arkansas didn't get anything. At least the ones I've spoken to. You know, there was no financial benefit to them from this discovery. And, you know, the ones I talked to said they really weren't looking for that. They were just incredibly gratified to find something that was going to help patients. You know, it was a pretty grim period where, you know, they want to help patients, they want to get them better, give them an extension of life, and it was really hard to do. Before this discovery. The Boston doctors who were researching this drug, they didn't directly get something, but their institution did. They get royalties from Revlimid. So there is a little bit of a benefit there to the research institution.

[Dave Davies]

Is it typically the case that, you know, grants from the National Institutes of Health, which go to, you know, research hospitals and teaching hospitals all over the country, that when they achieve something that's lucrative for a drug company, they share in the proceeds?

[David Armstrong]

Yeah, I think usually that's the case. And, you know, a lot of the most important developments have come out of academic labs, hospital labs, and, you know, these labs are willing to take chances that often pharmaceutical companies aren't. You know, they will study things that a drug company might look at and say, oh, there's not a big enough market, or, we're not sure that this will work. So once they're found in the labs, they often strike deals with pharmaceutical companies that might be a royalty arrangement or something else, but that's not uncommon.

[Dave Davies]

Gonna take another break here. Let me reintroduce you. We are speaking with David Armstrong. He is a senior reporter for ProPublica investigating healthcare. His new article about the high cost of the cancer medication Revlimid is the price of remission. We'll talk more after this break. This is fresh air.

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[David Armstrong]

I'm Tonya Moseley, co host of Fresh air. At a time of sound bites and short attention spans, our show is all about the deep dive. We do long form interviews with people behind the best in film, books, tv, music and journalism. Here, our guests open up about their process and their lives in ways you've never heard before. Listen to the FRESH AIR podcast from NPR and whyy on the Indicator from Planet Money podcast, we're here to help you make sense of the economic news from Trump tariffs. It's called in game theory a trigger strategy or sometimes called grim trigger, which sort of has a cowboy esque ring to it to what exactly a sovereign wealth fund is. For insight, every weekday, listen to NPR's the Indicator from Planet Money.

[Dave Davies]

You know, we talked about the high cost that people pay for prescription medications. You've also written about many cases in which insurance companies deny doctors and patients reimbursement for certain tests or treatments that they have ordered. And you wrote extensively about a young man named Christopher McNaughton who suffered from a condition called ulcerative colitis. This really affected him in a bad way. Got it when he was in college, he finally got to the Mayo Clinic. He had a Dr. Edward Loftus, who put him on doses of two biologics, which are more expensive drugs because of the way they're produced. But his insurance company, UnitedHealth, scrutinized the cost. What ensued then?

[David Armstrong]

Well, you know, this was a situation where Christopher McNaughton had a very serious case of ulcerative colitis. He had to drop out of college. He was a basketball player in college. He was losing tremendous amount of weight. So it was a really detrimental effect to his life. And he struggled to find a specialist who could give him some relief from this disease. And that's when he got to the Mayo clinic and found Dr. Edward Loftus, who prescribed a pretty aggressive regimen of drugs that were very expensive. And the interesting thing about Christopher McNaughton's case is he sued UnitedHealth and was able to access records about the company's decisions on his healthcare, including some audio recordings. And it was apparent from these records that cost was the issue. And what they did was they denied his care, saying it was not medically necessary because the regimen that his doctor prescribed was not an ordinary regimen Chris had a very extreme case, and his doctor said that cutting him off in this regimen would be life threatening.

[Dave Davies]

Right. Even delaying care could be terribly damaging.

[David Armstrong]

Right, that's true. This is a very serious case that had a debilitating effect on a young man.

[Dave Davies]

Yeah. There was also a moment at which UnitedHealthcare said that the doctor who had diagnosed him and had provided this elaborate and expensive treatment, that he was agreeing that a lower dose of the medication would be medically appropriate. Which was simply not true. Right.

[David Armstrong]

It was not true. And it was reflected in internal documents that he had said this when he had never said that. You know, they did admit later that he never said that, but there was such an effort to control the cost of Chris McNaughton's care that these kinds of things happened. In this case, you know, something that simply wasn't true and in other cases, sort of misrepresenting what his care was all about. And, you know, finally, Chris did win his case. You know, he won an agreement from the company to continue his care. A lot of details of that settlement are not public, but it took a tremendous effort, and most people are not so equipped to do something like that. In fact, it's so rare to find somebody who's actually sued their health insurer over denied care. It's an expensive proposition. People are sick. They don't necessarily want to go through it. So his case was extraordinary, both in what it revealed and the outcome.

[Dave Davies]

What did the United Health Care officials say when you reach out to them for explanations? I mean, yeah, you know, you had these documents, these recordings. It must have looked terrible.

[David Armstrong]

Well, they didn't answer my specific questions, but did say that they ultimately paid for his care. And they did point out that the dosages he was receiving, you know, exceeded what was in FDA guidelines, which, you know, his doctor said was necessary to get his disease under control.

[Dave Davies]

You know, you and some of your colleagues at ProPublica looked into companies whose business it is to review claims that insurance companies have been submitted for reimbursement and help decide what to pay and what not to pay. I don't know if I'm accurately stating this. One of the biggest is called Evicor. There's another one, Carillon Medical Benefits Management. What did you find that these companies do? What role do they play?

[David Armstrong]

These companies essentially review claims from insurance company's insureds and decide if they should be paid. So they're farming out the work of deciding what's appropriate care for their patients. And this is a growing business, one of the things we found is that companies are engaging in a lot of prior authorization where you can't get a treatment or a drug until they say it's okay. And for patients, this can be really disturbing. A lot of them have said that, you know, essentially the insurance company's playing doctor and deciding what I should get for care rather than my own doctor deciding it.

[Dave Davies]

Right now, insurance companies note that there are tests and treatments that are unnecessary or ineffective and that some unscrupulous doctors and other providers pad their income by ordering tests and treatments that they know aren't indicated. I mean, that is a real thing, right?

[David Armstrong]

That is certainly a real thing. And I've actually written about some of that in the past. I think what has happened is that has been broadened to such a degree that it covers a wide swath of care. You know, cardiology, there's a lot of reviews. Oncology, there's reviews. Certainly in the, in the orthopedic world, you see a lot of insurance companies applying their own medical guidelines and analysis in determining whether someone should get that care. So I think it's true that there are cases where doctors over prescribe or order tests that aren't necessarily needed. But this has broadened into a large practice of deciding what patients should get.

[Dave Davies]

It's interesting that you have a story in which you note that anyone who is having a dispute with their insurance company about a claim, payment for a claim could get actually internal information from the company about its deliberations, including memos, emails, maybe even phone recordings. How do they do this?

[David Armstrong]

Well, you have a right to get that information. You can write to your insurance company to get it. We have on our website an aid for people to draft letters seeking your claim records. You know, one of the things we found when we were looking into insurance denials is that very few people ever challenge a denial. It's a small, small, small percentage, a single digit percentage. But when people do challenge them, they're often successful, you know, as much as half the time. So if you have been denied prior authorization for something, or if a claim came in and it was denied, it's worth the efforts. Especially if it's a significant amount of money to challenge it, it's well worth the effort. If it's an amount of money that makes a difference to you.

[Dave Davies]

When you were reporting the story about Revlimid, you know, you're doing this research, which you've done so many times, and you're also dealing with the effects of your own illness, the multiple myeloma. I wonder did you or any of your editors have a concern that this might compromise your objectivity or offer an opening for critics to challenge your reporting?

[David Armstrong]

I think that's a fair question. And the way that we thought was best to deal with that was to be transparent. You know, I have this disease. I am a patient on this drug. I could at some point be financially impacted, you know, depending on my insurance, which, as I mentioned, has changed several times. So we thought it was important to let people know. And when I sought to interview people, I would tell them I'm a patient, I take the drug, and then people can make their own conclusions about what motivates me. I will say that being a patient changed my perspective. And before I even started on this story, I wondered, is it worth doing? Because for me, this is working. I don't have to pay much. Why write about it if these high prices mean I get an effective drug? But ultimately I came down on the side of this doesn't work for everybody, and that there's so much more research and discoveries that need to happen, and we need money for that. And a lot of money is going to things like stock buybacks and executive pay and just to the bottom line. And I'm not saying that they shouldn't make a profit. They have a good drug. They should make a profit. But it was such an extraordinary amount that could have been directed to other resources that help patients in the long run.

[Dave Davies]

Well, David Armstrong, good luck with your treatment and thanks for your reporting and thanks for speaking with us.

[David Armstrong]

Well, thanks for having me. I enjoyed it.

[Dave Davies]

David Armstrong is a senior reporter for ProPublica. His new story about the high cost of the cancer drug Revlimid is the price of remission. We recorded our interview Monday. Coming up, David Bien Cooley reviews a new documentary about the remarkable life of singer songwriter Janice Ian, whose career dates back to her early teens. This is FRESH air.

[Janis Ian]

Imagine, if you will, a show from.

[David Armstrong]

NPR that's not like npr, a show that focuses not on the important but.

[Janis Ian]

The stupid, which features stories about people.

[David Armstrong]

Smuggling animals in their pants, incompetent criminals.

[Janis Ian]

And ridiculous science studies.

[Dave Davies]

And call it Wait, Wait, don't tell.

[David Armstrong]

Me, because the good names were taken.

[Janis Ian]

Listen to NPR's Wait, Wait, Don't Tell me.

[David Armstrong]

Yes, that is what it is called. Wherever you get your podcasts.

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[NPR Announcer]

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[Dave Davies]

Janis Ian, the singer songwriter who had her first hit record as a teenager in the 1960s, is the subject of a new documentary, Janis Breaking Silence, now available to stream on Demand. Our TV critic David Biancooley has this review.

[Janis Ian]

When Janis Ian was young, she was very precocious. She got her first song, both lyrics and music, printed in the same folk music magazine that first published a song by Bob Dylan. But at the time she was only 13. Not long after, she recorded another composition, society's Child, which was about a young girl whose date arrived to pick her up and was met with disapproval from her mother because her daughter was white, but her date was black. That was in the mid-60s, and the song became a hit after Leonard Bernstein featured it and her on a TV special he hosted for CBS in 1967.

[David Biancooli]

I've managed to find marvelous song called Society's Child, written astonishingly enough by a 15 year old girl named Janice Ian. This tune is very well known among the followers of pop music, but you may not have heard it since it's been withheld by most of the radio stations for reasons unknown to me, although probably having to do with its subject matter, which is, as you'll see, somewhat controversial. Listen hard to Society's child come to my door. Baby face is clean and shining, black is night My mother went to Auntie know that now I could understand your tears and your shame. She called you boy instead of your name when she wouldn't let you inside when she turned and said, but honey, he's not our kind.

[Janis Ian]

The next time Janice Ian had a hit record was almost a decade later, at age 24, she appeared as a musical guest on the very first episode of NBC's Saturday Night Live, singing a song looking back on her own adolescence. It was called at 17. In Janice Ian Breaking Silence, the new documentary by Varda Barkar, you get to see and hear Janice perform it, while people such as actress Jean Smart talk about what the song meant to them.

[NPR Announcer]

To this it affects me the same way as when I first heard it. It's not just she's talking about the pain of adolescence and the pain of feeling like an ugly duckling. The pain of not being in the in crowd or whatever. It's also about being the tall, blonde, blue eyed cheerleader.

[David Biancooli]

Remember those who win the game.

[NPR Announcer]

I was the cheerleader. I was the girl that Janice sang about in at 17. I was the good girl who was dating the bad boy.

[Janis Ian]

Janice ian won her first Grammy for at 17 when it was presented to her by Lily Tomlin. Janis noted the long gap between her first and second hit records in her acceptance speech, which I will now play in its entirety.

[David Biancooli]

Thank you. It's been a long time.

[Dave Davies]

Thank you.

[Janis Ian]

Janice ian won her second Grammy not for singing, but for talking. In 2013, she won a Grammy for best spoken Word album for her reading of her just published memoir, Society's Child. That memoir showed that Janice Ian was a gifted writer even when she wasn't writing lyrics. Her writing style is clear and honest and the way she read her own words was both conversational and confessional. The same elements shine through in this new film documentary which has Janice Ian talking candidly about her past. Whether she's talking in vintage or newly recorded interviews, she's a gifted storyteller, even when she's talking about such personal memories as her then husband who abused her.

[David Biancooli]

Go find a fence, locate a shell and h yourself gone. Go to hell. Go away from me. The last time I saw him, he held a gun on me for seven hours. I talked to him about being Catholic, about how his grandmother would feel. I urged him to take more Valium because he took a lot of Valium. I urged him to keep drinking. I hoped he would pass out. He finally agreed with me that he was tired and I helped him up to bed, left the house. That was it. And it's a terrible thing to say in some ways, but the day that he died was the day that I finally felt free because I no longer had to worry about him coming for me.

[Janis Ian]

After that marriage, Janice Ian kept recording albums and writing songs, but approached her work and her life differently. She came out and wrote a regular column for the Address. She married again in 2003, this time to a woman, Patricia Snyder, and after their marriage, she wrote a song about it, Married in London, which she performed gleefully in concerts until a medical problem with her throat forced her to quit touring.

[David Biancooli]

We're married in London but not in New York. Spain says we're kosher, the state say we're pork. We went in Toronto, the judge said amen. And when we got home we were single again. The idea of getting married as a gay person was so foreign. We kept thinking that it wasn't going to mean that much. Everything was going to be the same. We were really shocked when we both started weeping after the ceremony.

[Janis Ian]

Janice E. In Breaking Silence tells her story using several visual techniques, including animation and recreations. Not all of them work, but the best storyteller in this documentary is the artist herself. Whether she's singing or talking, Janice Ian is captivating, and in her 70s now, she's still quite precocious.

[Dave Davies]

David Biancooli is a professor of television studies at Rowan University. He reviewed Janice Breaking Silence, now available on many streaming sites to view on demand. On tomorrow's show, writer Amy LaRocca joins us to talk about her new book, how to Be well, a guide drawn from her search for balance in a world obsessed with wellness. From fitness fads to mental health trends, she tries to unpack what it really means to take care of ourselves. I hope you can join us. Our interviews and reviews are produced and edited by Phyllis Myers, Ann Marie Baldonado, Lauren Krenzel, Teresa Madden, Monique Nazareth, Dana Challoner, Susan Yakundi and Anna Bauman. Our digital media producer is Molly CV Nesper. Roberta Shorrock directs the show for Terry Gross and Tonya Moseley. I'm Dave David.

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[David Armstrong]

It can feel far away. Not on the State of the World podcast with journalists around the world, you'll hear firsthand the effects of US Trade actions in Canada and China. And meet a Mexican street sweeper who became a pop star. We don't go around the world. We're already there. Listen to the State of the World podcast from NPR every weekday.