The story has been going on for weeks, so things are not definite, but as of right now, the Democrats in the House plan to pass the legislation that includes provisions to lower prescription drug prices sometime this week. If they can do that the drama will then go to the Senate, where it has been repeatedly reported that Senators Joe Manchin (D-W.Va.) and Kyrsten Sinema (D- Ariz.) have been opposed to certain provisions in the legislation.
Once it goes to the Senate, however, it appears a new issue has developed that has caused other Democratic Senators to express doubts about the bill.
(We want to remind you that Republicans have indicated none of them will support whatever bill the Democrats come up with so all the decisions being made are by the Democrats.)
The issue is the Democrats’ push to penalize drug makers if they raise prices of medicine faster than inflation, a provision Republicans and the drug industry see as government overreach — and, they say, a violation of particular Senate rules for considering this kind of bill.
According to a report in Politico, “Republicans are ‘likely to challenge everything and anything that looks or smells like [controlling] private markets,’ said one pharmaceutical lobbyist, who asked not to be identified to speak candidly about the next steps. ‘That is their operating plan.’”
In that same report it says, “Drug industry lobbyists are urging Republican senators to scuttle the drug-pricing language with parliamentary challenges while looking for cracks in the Democrats’ ranks after the industry fought off more aggressive House attempts to impose drug price controls.”
The CEO of the drug makers' big Washington lobby, the Pharmaceutical Research and Manufacturers of America, or PhRMA, said last week that unintended consequences from the Democrats' drug-price effort "will upend our global leadership in biomedical innovation and undermine the quality of care that patients receive for years to come.” The industry argues drug price controls will eat into R&D spending and result in fewer new cures coming on the market.
Business groups like the U.S. Chamber of Commerce and the Small Business & Entrepreneurship Council that are fighting the broader social spending bill have echoed those industry arguments in objecting to the drug pricing provisions.
As we reported last week, PhRMA alone has spent over $23 million so far this year in lobbying against this effort. That does not count what the other groups have also spent
If the drug companies spent that amount of money in developing new drugs instead lobbying to stop lower drug prices, we wonder what new drugs might come of that.
But there is more to this story.
The bi-partisan Congressional Budget Office (CBO) issued a report that says lowering drug prices would reduce the number of new drugs coming to market by two new therapies in the first decade, adding up to possibly 60 fewer drugs over 30 years.
CBO calculates this would lead biopharma companies to abandon the development of drug candidates with less certain returns on investment. Those less profitable therapies, such as for rare conditions or infectious diseases, may be first on the chopping block, as opposed to new medicines that address clear needs for large patient groups.
However, in an article in StatNews in 2019, three health care professionals challenged the claim of reduced research for new drugs. They examined the origin of some of the highest selling drugs of Pfizer and Johnson and Johnson, which were the two largest pharmaceutical and biotechnology companies in 2018.
They concluded that “… these large pharmaceutical companies did not actually invent most of the drugs they sell. Indeed, it appears they have already reduced their investment in the discovery of new medicines to the point where the threat of additional reductions rings hollow and is no longer a persuasive reason for opposing legislation to lower drug prices.”
Their research showed that “The discovery and early development work were conducted in house for just 10 of Pfizer’s 44 products (23%). Only two of J&J’s 18 leading products (11%) were discovered in house.”
The majority (81%) of other products were discovered and initially developed by third parties, including smaller pharmaceutical companies they had acquired and by universities and academic centers.
Those facts are important, and it is why TSCL believes supporting lower drug prices for seniors, as well as for the rest of the nation, is the right way to go.
But the millions of dollars being poured into lobbying against lower drug prices is what TSCL is up against as we continue our fight, and it is an important reminder why your continued support of our efforts on your behalf is so important.