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Posts Tagged ‘Drug Prices’
February 14th, 2019 at 5:08 pm
Want to Address Drug Costs? Avoid Price Controls, Eliminate PBMs and Don’t Weaken Patents
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In an excellent piece in today’s Wall Street Journal, Scott Atlas of Stanford University highlights how Americans enjoy far greater access to new lifesaving drugs than patients in Europe and elsewhere, and how the movement to impose government price controls would only restrict access to new drugs and degrade Americans’ health outcomes, as we at CFIF have been emphasizing:

America has superior treatment results for virtually all serious diseases reliant on drug treatment, including cancer, heart disease, stroke, high blood pressure and diabetes.  Price controls would jeopardize that advantage…

Pegging drug prices to those of foreign countries, as both Bernie Sanders and Donald Trump have proposed, would ultimately lead to the same consequences Europeans endure – reduced access to critical drugs and worse outcomes, including more deaths from disease.”

Mr. Atlas also notes how the Trump Administration has taken positive steps toward actually reducing drug prices, by targeting rebates received by pharmacy-benefit managers (PBMs) from drug manufacturers:

The Trump Administration has announced a proposal to do away with rebates paid by drug manufacturers to pharmacy-benefit managers, replacing them with discounts to beneficiaries at the point of sale.  PBMs are middlemen that control ‘formularies,’ the lists of drugs covered by a plan.  Rebates from drug companies to PBMs are payments for influence – either to position a drug on the formulary as ‘exclusive’ or to give it preferred status over competitors.

PBMs act counter to patient interest while aggravating the lack of price transparency.   These complex behind-the-scenes payments – $179 billion in 2016 – reward inflated list prices, on which patient premiums are often based.  This prevents patients from taking account of price…  Go-betweens like PBMs should be eliminated.”

Finally, and just as critically, Mr. Atlas adds that weakening patent and intellectual property (IP) rights would constitute a particularly destructive course:

Drugs are the most significant reason for the past half-century’s unprecedented gains against deadly disease.  But policies that aim to reduce drug prices – price regulation and weaker patent protection – are also associated with delayed availability, less innovation, and limited access.”

Mr. Atlas delves into statistics showing the enormous advantage that Americans enjoy in terms of new drugs and health outcomes, and his piece is well worth the full read.  Hopefully policymakers at all levels of government are listening.

January 15th, 2019 at 11:31 am
Drug Price Controls Would Kill Innovation
Posted by Print

We at CFIF have been emphasizing the threat posed by new drug price controls inexplicably contemplated by the Department of Health and Human Services (HHS).  In December, CFIF filed formal Comment opposing that ill-advised proposal, and hopefully wiser minds will prevail before the damage is done.  In similar vein, The Wall Street Journal ran a welcome commentary entitled “The Drug Price-Control Threat” on January 8 of this year, and a followup letter from reader Bruce Zessar of Highland Park, Illinois in today’s edition offers a personal, real-world illustration of what could be lost:

Insulin isn’t the same now as when it was discovered a century ago.  My wife is a Type I diabetic, diagnosed when she was 14 in 1980.  She has been a beneficiary of the tremendous advances in insulin therapy during the last four decades, including Lantus and Humalog.  When we got married in 1990, she had to live on a rigid schedule, eating lunch at, say, noon, and then dinner by 6:30-7:00 every day.  That’s becaue of the way prior insulin therapies worked in managing blood sugar.  With the invention of Lantus and Humalog, she can now live a normal life like everyone else.

Insulin is a shining example of why drugs deserve the utmost patent protection to encourage continual innovation.”

Price controls have never worked in any nation that has tried them, or with any commodity.   Few, if any, products are as important to our lives as America’s world-leading pharmaceutical sector, and we mustn’t let the price control scheme contemplated by the HHS kill the goose that continues to lay golden eggs.