Among the foremost threats to individual freedom in America is the abusive and oftentimes lawless behavior…
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More Legal Shenanigans from the Biden Administration’s Department of Education

Among the foremost threats to individual freedom in America is the abusive and oftentimes lawless behavior of federal administrative agencies, whose vast armies of overpaid bureaucrats remain unaccountable for their excesses.

Among the most familiar examples of that bureaucratic abuse is the Department of Education (DOE).  Recall, for instance, the United States Supreme Court’s humiliating rebuke last year of the Biden DOE’s effort to shift hundreds of billions of dollars of student debt from the people who actually owed them onto the backs of American taxpayers.

Even now, despite that rebuke, the Biden DOE launched an alternative scheme last month in an end-around effort to achieve that same result.

Well, the Biden DOE is now attempting to shift tens of millions of dollars of…[more]

March 19, 2024 • 08:35 AM

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White House Drug Price Control Order Threatens U.S. Pharmaceutical Preeminence Print
By Timothy H. Lee
Thursday, September 17 2020
Imposing a new drug price control scheme constitutes an inexplicably reckless attack on the very same pharmaceutical innovators that are currently speeding toward coronavirus treatments.

In World War II, the United States became the world’s “Arsenal of Democracy,” a label introduced by President Franklin Roosevelt in a December 29, 1940, fireside chat as “a call to arm and support” nations allied against the unthinkable Axis menace as global war expanded.  

Although Russians to this day chauvinistically refer to World War II as “The Great Patriotic War,” as if they single-handedly defeated Hitler and the Axis, the reality is that America saved the world and won the war.  After all, the Soviets stood on the precipice of defeat with Hitler’s Wehrmacht within eyesight of Moscow’s spires when America finally entered the war, and were spared a two-front war against Germany and Japan that the U.S. was more able to master, in addition to the western fronts and vast supplies of American arms that kept Russia alive.  

“American industrial genius, unmatched throughout all the world in the solution of production problems, has been called upon to bring its resources and its talents into action,” Roosevelt said.  

Today, that story remains the same.  In the ensuing decades, and today amid a global coronavirus pandemic, America has played a similar “Arsenal of Democracy” role in providing the overwhelming share of lifesaving pharmaceutical innovations to the world.  

Disturbingly, however, a new White House executive order this week suddenly threatens our leadership role by introducing the prospect of drug price controls imported from foreign countries, some of which may practice socialized medicine.  

To understand the sheer scale of American leadership in pharmaceutical innovation, consider some simple yet awe-inspiring facts.   For years, the U.S. has accounted for jaw-dropping two-thirds of all new drugs introduced to the world.  That didn’t occur by accident, but rather from our market-based approach and strong tradition of patent and other intellectual property (IP) protections compared to the rest of the world.  

Today, in the race to defeat the coronavirus, the typical years-long or even decades-long development timeline has been compressed into mere months.  Health experts now state with increasing confidence that not one vaccine, but multiple vaccines, could be tested and available in upcoming weeks and months.  That constitutes a remarkable human and scientific achievement, with U.S. innovators once again leading the world.  

A new White House executive order, however, inexplicably threatens to undermine that sort of innovation going forward.  The order calls upon the U.S. Department of Health and Human Services (HHS) to introduce a new “International Pricing Index” (IPI) payment model that would tie the cost of certain Medicare Part B and Medicare Part D drugs to other nations’ price control systems.  

In other words, the new executive order imports drug price controls imposed by foreign regimes.  It’s worth noting that our current system has actually reduced the cost of the 50 most popular Medicare Part B drugs in recent years.  

More broadly, the order flatly contravenes President Trump’s promise earlier this year in his State of the Union Address to oppose any and all efforts to import socialism or socialized medicine to our shores.  

Americans know from first-hand experience with 1970s gas lines, as well as from examples like Venezuela today, that price controls never work.  Nations imposing drug price controls simply cannot access the array of new drugs available to Americans, and as a consequence their survival rates for such diseases as cancer are substantially lower.  For example, of all new cancer drugs introduced to the world over the past decade, fully 96% have been made available to American consumers.  Swedes, in contrast, can access only 64% of those drugs, while Canadians only receive 59%, Japanese only 58% and Greeks only 16%.  

In 2018, the Trump Administration’s own Council of Economic Advisers reported that, “If the United States had adopted the centralized drug pricing policy in other developed nations twenty years ago, then the world may not have highly valuable treatments for diseases that required significant investment.”  

The good news is that there’s still time for the Trump Administration to come to its senses, recognize in its broader wisdom the potentially destructive effects of this order and reverse course.  Federal rulemaking generally requires months or even years to complete, providing an opportunity for sobriety to prevail.  

Indeed, as demonstrated just this week on the issue of Canadian aluminum tariffs, the Administration has demonstrated a flexibility and willingness throughout its tenure to reconsider and reverse its earlier decisions when appropriate.  

This is precisely one of those instances.  

Imposing a new drug price control scheme constitutes an inexplicably reckless attack on the very same pharmaceutical innovators that are currently speeding toward coronavirus treatments.  Instead of importing foreign nations’ socialized medicine price controls to the U.S., we should be exporting our superior market-based system with strong patent protections to their shores.  

The White House must reconsider this potentially catastrophic executive order and take corrective action while there’s still time.  

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