- US drug prices are higher than anywhere else in the world. Congress has been trying to figure out who’s to blame, but there has been a lot of finger pointing.
- The Trump administration has proposed a change that would target shadowy middlemen called pharmacy-benefit managers (PBMs).
- But drug companies have been left largely unscathed. When senators pressed drug companies if they would commit to lowering prices, they were evasive.
- Senator Ron Wyden of Oregon is calling for Congress to take action. “In case there was any doubt, Big Pharma is not about to start self-policing their pricing practices,” he said on Monday.
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The US is facing a crisis about too-high drug prices. And lawmakers have been trying to find out which companies are to blame.
The Trump administration even recently proposed getting rid of a common practice employed by PBMs.
But when senators pushed drugmakers about also playing their part and lowering prices, top leaders at 7 big companies were evasive. Senator Ron Wyden, a Democrat from Oregon, asked big pharma companies if they’d support legislation reforming US drug pricing and requiring them to lower their drug prices. On Monday, he revealed their answers, denouncing the companies for not agreeing to do so.
He said their responses show that Congress has to do something significant to “end business as usual in the broken drug pricing system.”
“In case there was any doubt, Big Pharma is not about to start self-policing their pricing practices,” he said in a statement.
The Trump administration proposal has drug discounts, often called “rebates,” in its crosshairs. Rebates are negotiated by PBMs to get better, lower prices on medications. But patients also don’t always get those lower rates when paying for a medication at the pharmacy.
The proposal is focused on certain government programs, and wouldn’t necessarily translate to private, commercial health insurance companies, which cover another big chunk of American patients.
In late February, during a hearing that Sen. Chuck Grassley of Iowa led to examine high US drug prices, Grassley asked seven top pharmaceutical executives if they would commit to lowering their prices, should rebates be curbed.
“Some of you have voiced support for the recent rebate rule proposed by the administration,” Grassley said. “Should the administration finalise this rule, will you commit to lowering your drug prices?”
Their answers were mixed. Most were clear that they would support it in theory – but also added some caveats. Their companies provided similar answers in written follow-up statements to Wyden.
Here’s what they said:
AbbVie CEO Richard Gonzalez: “Mr. Chairman, we are supportive of the rule. We’d like to see it in its final form, obviously, to make a final decision. But we are supportive of taking the discount to the patient at the point of sale.”
AstraZeneca CEO Pascal Soriot: “The same for us senator. I would go one step further: If the rebates were removed from the commercial sector as well, we would definitely reduce our list prices.”
Bristol-Myers Squibb CEO Giovanni Caforio:“We have the same positions.”
Jennifer Tauber, executive at Johnson & Johnson’s Janssen unit : “Yes we’re supportive, and that definitely would be my goal. We would just need to see the final legislation, provided that there aren’t additional fees that are added into system to compensate for the rebates.”
Merck CEO Kenneth Frazier: “I would expect that our prices would go down if we change the system. Again, on the commercial side as well as the Medicare side.”
Pfizer CEO Albert Bourla: “It is very clear intention that we will not keep a single dollar from these rebates. We will try to move every single penny to the patients. And we think if this goes also to the commercial plans, that it would be even better for more patients.”
- Read more:
- America’s top pharma CEOs just got grilled by Congress over the cost of their drugs
- Everybody is talking about the high cost of prescription drugs. Here’s who’s actually responsible for the prices you pay.
- The Trump administration just took its biggest step yet to bring down the cost of prescription drugs – and it’s dividing the healthcare industry
- The CEO of a $US210 billion pharma company says that US drug prices are working against patients. One chart explains why.
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