Industry dubs Pelosi’s drug pricing plan ‘extreme’
The Biotechnology Innovation Organization (BIO) has claimed that if the drug pricing plan unveiled by US House of Representatives Speaker Nancy Pelosi yesterday, September 19, becomes law, it will upend the US’s ability to lead the world in biomedical innovation.
Pelosi’s plan calls for Medicare (a national health insurance programme) to negotiate prices on at least 25 medicines and up to 250 drugs. To be eligible for negotiation, the drug must lack generic or biosimilar competition.
But the plan has not gone down well with industry—BIO has claimed that the proposal “crushes the desperate hopes of patients and their families that life science innovators will be the answer to their prayers”.
Former Congressman Jim Greenwood, who also serves as president and CEO of BIO, said: “It abandons any pretence of allowing a free and fair market system to determine the value of prescription medicines, including for the most innovative medical breakthroughs.”
Under Pelosi's plan, the upper limit Medicare pays for drugs must be no more than 1.2 times the average price in six countries: Australia, Canada, France, Germany, Japan and the UK, according to news websites including Politico .
Greenwood warned: “It will extinguish any incentive for investors to provide the necessary funds to advance biotech medical discovery. House Democratic leaders would surrender to foreign bureaucracies the power to dictate the value of medicines and the treatments available to America’s patients.”
The US Department of Health and Human Services would oversee negotiations, according to the plan, and would need to consider a medicine's research and development and production costs, the drug’s value and sales information, and alternative treatments.
After the price has been negotiated, drug companies will be unable to raise the price above the rate of inflation until sufficient competition develops in the market.
But Greenwood has warned that BIO will oppose any plan that “destroys our ability to develop new treatments or restricts access to the medicines patients need”.
“It is deeply unfortunate House leaders have chosen an extreme approach that will make it harder to deliver meaningful reform for patients. The last thing we need is for our elected leaders to score short-term political points at the expense of meaningful long-term solutions that will benefit patients,” said Greenwood.
BIO has advised that lawmakers must reject this “extreme proposal” and work on real reforms that lower costs for patients and protect America’s leadership in medical innovation.
Trade association Pharmaceutical Research and Manufacturers of America (PhRMA) also claimed Pelosi’s plan was “radical” and would end the current market-based system that has made the US the global leader in developing innovative, lifesaving treatments and cures.
President and CEO of PhRMA Stephen Ubl said: “We do not need to blow up the current system to make medicines more affordable. Instead, policymakers should pursue practical policy solutions such as sharing negotiated savings with patients at the pharmacy counter, lowering coinsurance in Medicare part D, increasing transparency on patients’ costs, promoting value-based contracts, among other improvements to the system.”
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