New Drugs: Myths and Facts

We know that the U.S. spends twice as much per person on drugs as other advanced countries and has worse health. People sometimes have to choose between drugs and food, while drug company profits soar. But why? Why do drugs cost so much, and what can we do about it?


Newer and More Expensive
The journal Archives of Internal Medicine reports that spending on diabetes drugs increased by 87% between 1994 and 2007, from $6.7 billion to $12.5 billion. Much of the increase came from doctors prescribing newer, brand-name drugs such as rosiglitazone (brand name Avandia) instead of older generics such as metformin (Glucophage and others).

This would be fine if the newer drugs worked significantly better than the old ones, but they usually don’t. Marcia Angell, M.D., in her book The Truth About the Drug Companies, shows that the U.S. Food and Drug Administration (FDA) only requires that new drugs work better than placebos. They don’t have to be better than existing drugs. So generics get pushed aside for new, vastly more expensive brand names that usually don’t work any better.

The new drugs are often not as safe, either, because they haven’t been around long enough for the long-term problems to become known. We saw this recently with Avandia being implicated in heart attacks. But there are hundreds of other examples. The arthritis drug rofecoxib (Vioxx) was recalled for contributing to heart disease. Other drugs in this class, the “COX-2 inhibitors,” were also implicated.

But when those drugs came out, they were called miracle drugs that would basically end arthritis pain forever. Drug companies called them “superaspirins,” and Jerome Groopman, M.D., a highly-esteemed physician and science author, wrote in The New Yorker that “the drug represent[s] a quantum leap forward in the therapy of arthritis but, if some promising research is borne out, it may even play a role in preventing or treating a host of other conditions, from cancer to Alzheimer disease.”

Dr. Groopman forecast a possible ten billion dollar market for celecoxib (Celebrex), the first COX-2. He looked forward to being able to play tennis without pain and without even having to apply ice or heat to his knees. Sorry, Jerome. Outside of marketing campaigns, no scientist even claimed that the new drugs were more effective than ibuprofen or aspirin. They were just easier on the stomach. Unfortunately, they were harder on the heart, and billions of dollars were wasted on them.

Sometimes Newer is Better
In reply to Tara Dairman’s Oct 31 blog entry on drug costs (“The Rising Costs of Treating Type 2”), CalgaryDiabetic wrote, “I found using the long lasting insulin ‘Lantus’ much easier and possibly even less expensive overall, when you include less BG testing than when using the older NPH.” Basal, or long-acting, insulin analogs really are an improvement in treatment. They are still much more expensive than older insulin products, however. (You can read about why there are no generic insulin products on the market here.)

Drug innovation is worthwhile, and we don’t want to stop it by taking all the profitability out of drug research. It’s true that drug studies are very expensive to run, so companies need some reward. But new drugs’ advantages are oversold. Pharma’s marketing hype is like a Spielberg movie—very impressive, but not particularly believable. Most new brand name drugs are no better than old ones—in fact, they are often the same exact drugs in slightly different combinations!

What Can You Do?
I think it’s better to stick with generic drugs unless they’ve proven not to work for you. It’s better to wait until a new drug has been out a couple of years, because nasty, even fatal, side effects might not show up until then, as with Avandia, Vioxx, the Crohn Disease drug natalizumab (Tysabri), and many others.

Even if safe, a new brand name drug may not work any better, so be careful. Familiarize yourself with the treatment guidelines, like the new American Diabetes Association ones for treating Type 2. But be aware that the guidelines may not work for you, either. People with Type 2 diabetes tend to get overloaded with drugs, because insulin resistance may also contributes to high blood pressure, bad cholesterol, and depression. Doctors may medicate all these symptoms, leaving patients overmedicated and broke.

If this is you, discuss with your doctor what drugs you can do without. See some other tips about saving money on drugs here.

Don’t be afraid to try new drugs, but don’t get too excited either. Most generics work just as well for pennies on the dollar. And please let us know your experiences with new drugs by commenting here.

Learn more about the health and medical experts who who provide you with the cutting-edge resources, tools, news, and more on Diabetes Self-Management.
About Our Experts >>

  • CalgaryDiabetic

    Dear David and fellow diabetics. Would you please blog how much a 1000 IU vial of Latus costs you at your favorite pharmacy? Also what a box of 5 cartridges of 300 IU of Novorapid costs? If there are any replies I will tell you what they cost at Safeway here in Calgary, Canada. There is no govt subsidy here so it is purely capitalist transaction and I am wondering if America is being ripped off. There could be some difficulty in establish the relative value of Canadian/US dollars since the exchange has gone from 1.10 to 0.77 US /1 Canadian in the last year. But if the prices compare at $0.85 US = 1.00 Canadian that would be fair.

  • Jan Chait

    Calgary, I’ve blogged some about costs, on Jan. 2, 2008. See “Diabetes Costs, by the Mile and by the Gallon,” at


  • Robert Miles

    My doctors haven’t been saying much about changing to the newer diabetes drugs. However, I had enough bad reactions to metformin that I was changed to Actos. Later, for reasons that were never explained, at a time I didn’t have a good chance to ask, I was changed to Avandia. After a few years with no problems that appeared to be from Avandia, my insurance company insisted that I switch back to Actos. This time, it gave me digestive problems, constipation, and swelling of the feet and ankles. Finally, my doctor switched me back to Avandia, even though I haven’t heard whether my insurance company will now pay for it.

    Know any cheaper diabetes medicines other than metformin that might be worth trying?

  • CalgaryDiabetic

    Dear Diabetics.

    It does appear that the US pays more for diabetic drugs than Canada. Jan Chait said the Humalog vial was $97.00 US vs I paid $63.00 Canadian for a vial of Novorapid which is about the same “modern” type of insulin. I presume that the vial size of 1000 units of insulin is the same.

    She also mentioned that one month of Metformin at 1000 mg cost $170.00 per month. This seems wildly out of line since I paid about $27.00 canadian for 120 pills of 500 mg each. Jan did not say if the 1000 mg was three times a day. Even with this worst case senario it would still be only $54 Canadian for the month. Mind you mine was generic metformin. Glucophage would cost much more.

    Jan said thge test strips are about $0.80 US each. Here in Canada they are $0.75 Canadian or less if on sale. This is at Safeway not at any discount pharmacy.

    And to boot, usually the Canadian dollar is worth less than the US one. Except once last year when Warren Buffet shorted the Canadian at nearly $1.10 US, a genius.

  • David Spero RN

    Dear Robert,
    I can’t really suggest drugs. The sulfonylureas, such as orinase, micronase, and diabenese, are generic and cheap. But all they do is push your beta cells to produce insulin, putting you at risk for hypos, and probably wearing out your pancreas faster, although this is disputed.

    If your doctor thinks you need Avandia, because Actos and metformin haven’t worked, insurance should have to pay for it. Find out how to file an appeal if they give you a hard time.

    You might also consider herbal approaches, which I’ll blog about soon.

    Good luck,

  • James

    Reagarding the cost of Actos, my insurance company was charged $504 for a three months supply of 30 mg Actos tablets. an outragous sum in my opinion. You can purchase a generic drug from Canada drug called Piodlitazone for $196 (manuafactured in India)

  • Linda the Pharmacist

    David, I cannot believe that you failed to mention your local pharmacist as a resource for valuable medication information. Newer drugs are more costly and do not have the advantage of years of patient use behind them, so may be more risky than older medications. But they are usually developed to eliminate or minimize side effects from the oleder medications or to treat a condition with a new modality (Ex. Januvia – nothing else like it and it MAY prove to prolong the life of pancreatic beta cells). The Celebrex you dismiss as being worthless was a viable, helpful arthritis medication for many who suffered from ulcers when taking older NSAID pain medications. Many took this drug with NO problems and were devastated when it was removed from the market. Many of these medications are approved WITH appropriate warnings for appropriate use and contraindications. Unfortunately, MD’s try to please the patient demanding some drug they saw advertised on television or being taken by a relative and do not always assess the patient for possible problems with the requested medication.

    At our pharmacy: metformin XR 500mg #60 – $59.45 w/o discounts, etc.
    metformin 1000mg #60 – $92.15
    Lantus 10ml vial – $98.62 ($5.00 over cost)

    How many people complaining about the costs of medications also pay for computer service, cell phones, ipods, manicures, pedicures, frequent restaurant meals, etc. I think we need to get our priorities straight and quick expecting cheap quick fixes or government bail-outs.

  • Linda the Pharmacist

    Sorry – In the heat of the moment I misspoke. Celebrex has not been taken off the market, but Vioxx was – same story.

  • Margaret

    I have type 2 diabetic and I take metformin even if my sugar is low at bedtime 130 -150 when I get up in the morning it sometimes will be as high as 157. Will Januvia help control this spike of sugar in the morning? I don’t know how long its been on the market or what the side effects are. Can you give me some details?


  • David Spero RN

    Well, Januvia is one of those new drugs that people get very excited about. There is some evidence that it helps if given in addition to metformin in people who still have some beta cell function.
    Some patients love it, but some report that their sugars actually get worse, and/or they have serious side effects like major joint pain. In general, I’d avoid it, but your decision may be different. You can see a good discussion on Diabetes Mine at

    I didn’t say the Cox 2 inhibitors were useless. They do help some people who can’t tolerate the older NSAIDs. But that’s NOT how they were marketed. They were said to be a virtual arthritis cure, and millions of people took them who didn’t need them, and some of them got heart attacks, and a billion dollars were wasted. I’m just saying to be very skeptical of drug company marketing.

    Thanks for your insights and participation,

  • CalgaryDiabetic

    Dear David and Readers.

    My friend Ernie is super fit physically took Celebrex (he has inherited severe arthritis), he said it is unmatched for pain relief. But one day he had to be rushed to emergency with heart attack symptoms. He survived with no damage.

    I was reading the blood-glucose meter evaluation in the September 2008 issue of Consumers Report that said taht Wal-Mart has a ReliOn Ultima meter with test strips that are only $0.44 each. The strips are rated very good for consistency and accuracy. I tried to buy them here but Wal-Mart Canada had never heard of their own US brand.

    I tried some other discount brands possibly including the True Track and they where neither consistent(how closely two readings done at the same time compare, usually called precision) and of course neither accurate (how well the measurement compares to the blood lab results).

    Also it would be interesting to start a blog on the accuracy of meters and test strips by taking simultaneous readings with are meters when we go to the blood lab. My best meter was the Ascentia Elite with a 60 second measurement time that was always 5% less than the official lab blood glucose reading. The new meters with 5 second response time have all been way worst.

  • Lorraine

    Hi, for Calgary I am a type 2 senior diabetic and live in Quebec and am paying $39.03 for glucophage-120 for 500 mg. so I would say you and I are pretty close.I am not sure if it is the original or not. My perscription receipt says glucophage and is bought from Jean Coutu. For Margaret I am takeing Januvia for about 6 months with no side effects. My sugar is also about the same as yours at nite and the januvia is to try and lower my BS before and after breakfast taken with my glucophage. One thing is that Januvia is expensive. I am taking one 100mg tab at $106.99 per month. It has lowered my BS somewhat but not as much as I had hoped because I have a fear of taking insulin as I live alone. My Dr. has also added Diamicron at nite.Today my bs was 7.5 before breakfat and 11 after.