Anybody surprised to read this (from Knight Ridder)?

The new Medicare drug benefit will give drug companies up to $2 billion in extra profits this year because they're no longer required to pay rebates on drugs bought by the government for the elderly poor....

The boost in profits comes from a shift in the drug coverage of 6.4 million poor and elderly people from Medicaid to the new Medicare drug benefit. Unlike Medicaid, which requires drug companies to charge their lowest or "best price" for medications, the Medicare program relies on competition among private drug plans to keep prices low. By eliminating the need to discount drugs for the government, the industry can now pocket the savings.

"The net effect over 10 years is probably closer to $40 billion in extra profit," said Stephen Schondelmeyer, a pharmaceutical economics professor at the University of Minnesota....

The story tells us that this is based on a study conducted by a really unhinged band of lefty agitators -- the Prudential Equity Group, LLC. (Everybody knows they get their orders straight from Michael Moore and Osama bin Laden, right?)

Professor Schondelmeyer confirms Prudential's estimates with some research of his own:

He studied about 40 plans in one area of Minnesota and found that prices in each plan on 25 different drugs were within four percentage points of the regular retail drug prices. And most of the Medicare plan prices were 20 to 30 percent higher than the cost under Medicaid.

Oh, hell, Big Pharma needs even more of our money, right?

(Via Memeorandum.)