But they don't just price gouge. Drug companies need to file patents on their drug almost as soon as they sketch they come up with drug. From there they need at least 8 years to get through the FDAs approval process, so the manufacturers don't get nearly as much exclusive time with their IP as other industries. (They started getting around that by slightly tweaking the formula to last longer and calling it XL.) Plus they have to recoup the money they sank into other drugs that never made it to market. Sure, they can write down those losses, but a write-down ain't a refund.
If the government wants to start lowering drug prices, they can start by creating a special patent for the drug industry—call it a research patent—that can get converted to a regular patent when it gets FDA approval, and then give the drug companies the patent for the standard 20 years plus a renewal if they work the patent.
The next step: they can shorten time to market. We have evidence that the FDA errs too conservatively and doesn't approve (or delays) drugs that would have turned out totally safe and helped people. I remember they granted special approval to bring in a meningitis vaccine that Europe had for a while when an east coast school saw an outbreak. The vaccine still hadn't cleared the FDA, but I guess FDA special clearance is better than doing nothing. If it's safe enough for Western Europe, it's probably safe enough for Americans.