Drug Company Profits Soar as Taxpayers Foot the Bill

It was a coincidence hard to overlook: The government released a new report on Tuesday projecting rising health care costs for the coming decade while a major pharmaceutical company issued a new earnings report showing extraordinary profits on the sale of new wonder drugs.

While drug spending increased by a modest 2.5 percent in 2013, it surged by 12.6 percent last year according to estimates in a new report on trends in health care costs by the Centers for Medicare and Medicaid Services. One of the major factors was the relatively recent Food and Drug Administration approval of highly effective -- but extremely expensive -- specialty drugs like Sovaldi and Harvoni for the treatment of Hepatitis-C, a potentially fatal liver disease.

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