Tag: Reference pricing

Germans force competition among drug companies; should the US follow suit?
In an article for Health Affairs, James C. Robinson argues that the US should take a page from Germany to drive competition among pharmaceutical companies and to lower drug costs for individuals. Medicare and other insurers should pay a fixed fee for drugs with the same clinical benefits, regardless of their cost, and leave it to individuals to decide which drug to get. Ideally, drug manufacturers with costlier drugs would be forced to bring down their prices in order to compete effectively.

It seems insane that drug manufacturers can charge very different prices for drugs that are similar in effect, and that Medicare and other insurers will pay more for drugs that are no more efficacious than less expensive drugs.
In Germany, when there are three or more drugs that are equally effective, they are treated as if they are in the same therapeutic class. They might be brand name or generic or both. The insurer then pays no more than a particular price for all these drugs, which the insurers collectively set.

Patients have a powerful financial incentive to choose the lowest-priced drugs when they offer similar clinical benefits as the higher-priced drugs. Patients must pay whatever the difference in cost for the higher-priced drugs. Generally, this leads the manufacturers of the higher-priced drugs to reduce their prices.

Insurers in Germany are generally able to negotiate additional discounts on a single drug in that class through a confidential rebate system with the manufacturer of that drug. The manufacturer wins with more business; consumers win with lower prices.

For the German reference pricing system to work best, there need to be several drugs in a class. So, the German government broadened therapeutic classes for biologics and biosimilars, where there are otherwise too few drugs to promote competition.

The system in the US does not begin to work as well for several reasons. The authors focus on the fact that all drugs in a therapeutic class tend to cost consumers around the same coinsurance amount, so pharmaceutical companies don’t benefit from bringing down their prices. Moreover, the coinsurance amount can be so high that patients are forced to skip filling their prescriptions.

The US drug pricing system is inequitable, discriminating against people with lower incomes. People pay too much for drugs that are fairly priced and not enough for drugs that are overpriced.

Why shouldn’t drugs be priced in keeping with their value so that manufacturers set fairer prices and patient’s can more easily afford them. Higher out-of-pocket costs should accompany drugs that are priced above their clinical value. Drugs should be easily affordable to people when they are priced at their clinical value.

Insurers in the US have not used reference pricing for drugs for two principal reasons. Pharmacy Benefit Managers, the middlemen who buy drugs from pharmaceutical companies and design and administer insurer formularies don’t like it. Reference pricing would eat into the enormous profits they make from rebates they get from manufacturers to list their high-priced drugs on a formulary at a low out-of-pocket cost. And purchasers worry that they take a risk with reference pricing that they don’t want to take.

But, insurers should test reference pricing on biologics and biosimilars with the same clinical value. Patients would then pay less for lower-priced drugs and more for high-priced drugs that are not superior. The result could yield significant savings and help ensure people can afford their drugs.

Here’s more from Just Care:

2023: Medicare Part D prescription drug coverage and costs

Prescription drug middlemen, PBMs, will always drive up drug costs

Will Rx provisions in the IRA disappoint?

The deadly consequences of out-of-pocket drug costs

Millions safely import low-cost drugs from abroad
January 3, 2023
Could the US lower drug costs through “value-based” pricing?
President Biden said in his State of the Union address that he supported Medicare drug price negotiation. Since the Democrats in Congress appear unable to pass legislation that would allow Medicare to negotiate drug prices, would he support a different fix? Some experts believe that “value-based” pricing of drugs is the way to go.

Before we get to value-based pricing as a way to lower drug prices, let’s not forget far simpler solutions. For example, there’s exercising the “march-in rights” authority that the administration has under the Bayh-Dole Act. The administration could use march-in rights to buy the patent of any critical drug that is unreasonably priced and allow other drugmakers to manufacture generic substitutes at lower cost. The administration could also make it legal for people to import drugs for personal use. President Biden does not appear interested in either of these fixes though.

In a blog post for the Commonwealth Fund, Patricia G. Synnott, Daniel A. Ollendorf, and Peter J. Neumann suggest that if Biden wants to lower drug prices, perhaps “value-based pricing is a solution. It would reward drug manufacturers for innovations that delivered valuable drugs and therefore could not be said to stifle innovation. And, it could keep the price of drugs that offered little or no value way down.

Of course, Medicare drug price negotiation could easily promote innovation of high-value drugs. The government could deploy the savings from lower drug prices towards innovations that are of most benefit to the public. This policy was embedded in HR3, Speaker Pelosi’s drug price negotiation bill that passed the House a few years ago.

Value-based pricing works to ensure that costly drugs for which there are no alternatives are evaluated. Is their cost appropriate relative to the health they promote? So, instead of Medicare drug-price negotiation focusing on the prices other countries pay for the same drug, value-based pricing would focus on a drug’s value.

The blog post authors appear to think it would make sense for Americans and Medicare to pay a lot more than people in other countries for highly effective drugs developed in the US and/or with US taxpayer money. Really? It’s not clear if they are offering up this proposal because they think it is more likely to be enacted into law than international reference pricing–setting prices in this country at the same average level as other wealthy nations–or because they think it is preferable.

The authors say that international reference pricing is imperfect because it could lead drug manufacturers to delay release of drugs in countries where prices would be lower. And, it could also increase prices in other wealthy countries. While true, these points are trivial relative to the huge price reductions people would see for drugs with a high value—and that’s what’s needed.

Moreover, value-based pricing is beyond imperfect. Just imagine the money and lobbying that drug manufacturers would put into ensuring that a mediocre drug was credited with being highly effective. How do you define a drug’s value anyway? Remember, it didn’t seem to take that much effort for the Sacklers, aka Purdue Pharma, to get the FDA to allow broad use of OxyContin. And, it seems to take virtually no effort for Medicare Advantage plans to get CMS to give them four and five-star ratings, even when the government has sanctioned them for endangering the health of their enrollees.

It’s similarly difficult to believe that a value-based approach undertaken by the federal government or a non-profit working for the government would lead to lower drug prices for drugs that did little if anything to improve health.

The authors acknowledge this issue, explaining that you would need an independent agency–be it a non-profit or an independent government agency–to set prices. Again, does anyone think that is possible in today’s world, with so much money on the line for the pharmaceutical industry?

It goes without saying that we should not be paying high prices for drugs with low value. It also is the case that other countries, including the United Kingdom and Italy, base their drug prices on the drugs’ value. And, at some point down the road, it would be wise to adjust drug prices in the US so that those that deliver value are appropriately priced and that pharmaceutical companies cannot profit wildly off of drugs with little or no value.

But, the US needs to act quickly to address a drug price crisis that is keeping tens of thousands of people, if not more, from being able to take the drugs they need. The world is flat. And, setting prices quickly at a level commensurate with the prices in other wealthy countries seems the smartest way to launch drug price reform. Opening up our borders to drug imports from verified pharmacies around the world would be a great first step.

Here’s more from Just Care:

Poll: Prescription drug prices in 2022

GAO finds US drug prices more than four times those in France

Public supports benchmarking US drug prices to prices in other countries

Drug companies can make out like bandits regardless of drug’s value

We pay a lot more than we realize for prescription drugs
May 10, 2022
Government drug price-setting could save millions of lives and end diseases
In an opinion piece for Stat, James Glassman, a former undersecretary of state for public diplomacy, overlooks the fact that proposals to base drug prices in the US on the prices other wealthy countries pay are the most likely way the US will have the money and interest to invest in research to end cancer and other deadly diseases. Glassman fails to consider that right now the pharmaceutical industry is price-gouging and targeting its research where it can maximize profits, not end diseases. Drugs don’t end diseases if people can’t afford them or if they are never developed.

Right now, every other wealthy nation sets drug prices. And, though it is not technically legal, millions of Americans with means are able to take advantage of those prices through importation. The FDA has never prosecuted anyone for importing drugs for personal use. So long as the US does not set drug prices, Pharma will price-gouge and set the agenda as to where to invest in research.

Moreover, our government’s failure to permit importation, let alone to import drug prices leads millions of Americans with limited assets to go without life-saving medicines. By not importing drug prices, Congress is permitting excessive pharmaceutical company profits at the cost of millions of American lives.

Setting drug prices at a level comparable to other wealthy countries makes market sense. That’s the price Americans pay when they import drugs. It’s a reasonable and quick way to level the international playing field on drug prices. And, it would generate hundreds of billions a year in savings.

If the US set prices at a level comparable to other wealthy countries or even to the Veterans Administration, it could help end cancer. Yes, Pharma innovates under the current system, as Glassman contends. But, Pharma only develops new drugs—often new versions of drugs currently available—to support its bottom line, not the needs of people with health conditions that drug companies do not think they can profit from. If the drug companies don’t see big dollar signs, their research goes in other directions.

Savings from US regulation of drug prices could be applied to a national drug innovation agenda that ensured research and development of drugs to treat untreated diseases, which might not be as profitable as drugs to treat other conditions, but that would save lives. Moreover, the US could direct development of medicines that cure diseases, an important differential, as Pharma tends to develop drugs that people take for a prolonged period, as another way to maximize profits.

Here’s more from Just Care:
June 29, 2021
Senator Wyden sets forth principles for drug price reform
Jonathan Cohn reports for The Huffington Post that Senate Finance Committee Chair, Ron Wyden, just announced his principles for drug price reform. They should appeal to both progressive and conservative members of Congress. They speak to the need for lowering prescription drug costs for everyone in the US, without compromising innovation. Now, we need Congress to pass legislation that adheres to these principles.

Principle number one recognizes that the federal government should have the power to negotiate drug prices directly with manufacturers. That is a no-brainer. Without that federal power, because there is no meaningful drug price competition for brand-name drugs, Congress is allowing pharmaceutical companies to set drug prices.

Because pharmaceutical companies are setting drug prices in the US, tens of thousands of Americans are dying prematurely each year. They cannot afford their cancer, diabetes and heart medicines. If we paid the prices that other wealthy countries pay for drugs, we’d be paying less than half and sometimes as little as one fourth of what we pay today.

The government would negotiate drug prices for people with Medicare, but Senator Wyden wants private health insurers and the people they cover to benefit from lower drug prices, as well. How Congress achieves that goal is an open question. It would be easiest if it gave everyone Medicare simply for the purpose of benefiting from Medicare’s negotiated drug price. That likely won’t happen. Short of that, Congress might be able to make these low prices available through the thousands of Federally Qualified Health Centers.

Senator Wyden does not specify how Medicare would decide the prices of different drugs. He does not call for international reference pricing, which is the simplest way to ensure that drug prices come down without letting politics get in the way. It is the approach described in HR3, the House bill passed in 2019 that would lower drug prices for 250 drugs over ten years.

Some say that international reference pricing is “passing the buck.” They want an “American” solution. Really? If Congress passes it, it will be an American solution. Congress will have to decide which countries it should benchmark US drug prices to and under what circumstances. Congress will still have to decide what happens when Pharma fails to adhere to these prices.

International reference pricing is about as close to a “market solution” as we can get. If Congress allowed drug importation, drug prices in the US would end up being an international reference price of some sort.

Senator Wyden would also cap drug price inflation from one year to the next.

In short, Senator Wyden wants everyone to see lower drug costs at the pharmacy. Good idea. Everyone needs lower drug prices. Moreover, unless everyone enjoys lower prices, the pharmaceutical industry will threaten to raise everyone else’s prices. And, millions of Americans who don’t have Medicare will continue to die prematurely because they can’t afford their medications.

Senator Wyden’s principles for prescription drug reform should also lead to several hundred billion dollars in savings. That’s money that could go towards putting an out-of-pocket cap in traditional Medicare as well as adding vision, hearing and dental benefits.

Senator Wyden recognizes that reining in drug prices will not affect the innovation we need. Rather, it will allow us to direct more money toward critical and effective innovations. Right now, pharmaceutical companies spend relatively little on innovation. Moreover, a lot of their innovation money is focused on developing me-too drugs (variations on a drug already available) that do not add meaningful value.

Here’s more from Just Care:
June 23, 2021
Will Congressional Democrats agree on a way to lower drug prices?
The Wall Street Journal reports that Congressional Democrats are trying to find a path to lowering drug prices. But, will they agree on a policy that delivers lower drug prices? Or, will they defer to the pharmaceutical industry and let prices continue to mount, even though such an outcome will be mean the needless death of tens of thousands of Americans each year.

President Biden, for his part, has been relatively quiet on this issue. He has said that he supports lower drug prices. But, he did not include it in any of his reform proposals this year. Notwithstanding, many Democrats in Congress recognize that delivering lower drug prices in the US will help to keep the Democrats in power in 2022.

Senator Wyden and his team on the Senate Finance Committee are focused like a laser on this issue. Reports are that the Senator would like to marry the Wyden-Grassley prescription drug bill with Speaker Pelosi’s bill in the House. The House bill goes a lot farther than the Senate bill; it is not finalized but, in 2019, it called for setting drug prices for 250 drugs at not higher than 120 percent of what other wealthy countries pay.

The Senate bill is also not finalized, but it aims to keep drug prices from rising more than inflation, which rewards all the drugmakers with the most inflated drug prices today. We do not yet know whether it will do anything to reduce the cost of life-saving drugs. In its last iteration, it also reduced out-of-pocket prescription drug costs for people with Medicare, but that’s simply squeezing a balloon. Most likely, premiums and other costs would rise.

A recent Government Accountability Office report found that brand drug prices in the US are three to four times higher than they are in France and other Western European countries.

Bringing down drug prices in the US for everyone is far more complicated than you might imagine. Congress does not have clear authority over corporate health insurers or over the price retail pharmacies charge for drugs. So, while the House bill will have Medicare negotiate drug prices and allow corporate health insurers to benefit from those prices, it’s not entirely clear how. The House bill does not cover the uninsured.

The easiest way to extend regulated drug prices to everyone is for Medicare to negotiate lower prices and for Congress to extend Medicare to everyone free of charge exclusively for the purpose of benefiting from these lower prices at the pharmacy. That is not likely. Alternatively, Congress could make drugs at low prices available to everyone through Federally Qualified Health Centers. At the moment, it does not appear that Congress is looking at this option either.

Congress could also lift the ban on prescription drug importation. Corporate health insurers, in turn, could then perhaps be required to cover drugs at those imported prices. The problem, of course, is there are many lifesaving drugs that cannot be imported. And, it can sometimes take months to receive drugs that are ordered from abroad.

Republicans now say that they are against Medicare-negotiated drug prices. But, Republican members of the Senate Armed Services Committee just a few years ago supported international reference pricing–pricing drugs at a level comparable to other wealthy countries–by unanimous vote.

Innovation would benefit significantly from negotiated drug prices. Congress could allocate some of the hundreds of billions of dollars saved each year towards research and development of new drug therapies. Right now, Pharma invests little in research and tends to invest primarily in new versions of drugs already available on the market–“me-too” drugs–rather than drugs that are truly breakthrough.

Democrats do not need a super majority to pass drug price legislation. They can pass it by simple majority through the budget reconciliation process. But, they will need Joe Manchin and Kirsten Sinema and Bob Menendez to vote with them. And, they are not yet guaranteed to do so.

Here’s more from Just Care:
June 10, 2021
A small group of drugs make up most of Medicare drug costs
With Medicare prescription drug spending, the 80-20 rule applies. A new Kaiser Family Foundation analysis by Juliette Cubanski and Tricia Neuman finds that a small portion of Medicare Part B and Part D prescription drugs make up a large percentage of Medicare drug costs.

Cubanski and Neuman estimate that Medicare Part D drug spending in 2019 was about $145 billion after rebates. Medicare Part D currently covers about 3,500 drugs purchased through a pharmacy. Just 250 of these drugs–brand-name drugs with no competitors–no generic substitutes or biosimilars, accounted for 60 percent of that prescription drug spending.

The average net cost for each of these 250 drugs was $5,750. You have to wonder how many people with Medicare could not afford to fill these prescriptions given high Part D out-of-pocket costs. The ten costliest of these 250 drugs accounted for 16 percent of Medicare Part D spending but just .3 percent of all drugs covered under Part D. Cancer and diabetes medicines as well as medicine for rheumatoid arthritis are among the top ten.

Bottom line: If Congress passes legislation to rein in Medicare prescription drug prices on 250 drugs, as specified in the House bill that passed in 2019, H.R.3, savings would be significant.

Fifty drugs covered under Medicare Part B account for 80 percent of Part B drug spending. Medicare Part B covers drugs received in hospital or administered by a doctor in the doctor’s office. It does not cover drugs purchased from a pharmacy.

In 2019, the ten costliest of these Part B drugs represented 43 percent of all Part B drug spending but just 2 percent of all the drugs Part B covers. Cancer, rheumatoid arthritis and osteoporosis drugs are among these top ten, as well as two drugs for macular degeneration.

Cubanski and Newman suggest that policymakers in Congress might be wise to limit drug price negotiation to 250 drugs given that they account for such a high proportion of overall spending. However, they also recognize that there’s value in extracting savings from all drugs. What they fail to mention is that there are millions of people with Medicare who will be left with unaffordable drug and health care costs–and won’t be able to fill their prescriptions–if Congress limits negotiation to just 250 drugs and takes no further action to limit out-of-pocket drug costs. In addition, higher Medicare drug spending drives up Medicare premiums.

Here’s more from Just Care:
April 22, 2021
Drugs in the US should be priced on a par with other wealthy countries
The pharmaceutical industry is lining up its allies to help in whatever ways they can to keep Congress from reining in drug prices. Specifically, they want to do their best to mislead the public about the value of benchmarking drug prices in the US to prices in other wealthy countries. International “reference pricing” is the smartest way to ensure that Americans pay fair prices, prices in balance with what other wealthy countries pay, prices we would pay if it were legal to import drugs from abroad.

Back in 2019, the House of Representatives passed H.R.3, which calls for international reference pricing for up to 350 commonly used drugs over 10 years. Now, thankfully, House Speaker Nancy Pelosi wants to include similar legislation in President Biden’s infrastructure proposal. Tom Price, a former Congressman, former Secretary of the US Department of Health and Human Services and a drug industry ally, writes in the Hill about “unintended consequences.”

Tom Price misleads with his arguments. Innovation in our current system is not nearly as good as it could be. Big Pharma has focused far more on producing me-too profit-enhancing drugs that are variations on drugs already available than on meeting the needs of people with rare diseases and conditions. It has invested far more of its revenues on marketing than on research.

Innovation could improve substantially with international reference pricing legislation. H.R.3 would take much of the hundreds of billions in savings and put it towards drug research that adds value. Pharmaceutical companies spend very little of their budget on research.

Moreover, we import food and virtually every other good and service. Safety is always an issue, and we manage it. There are verified pharmacies around the world from which we could purchase drugs safely. Why shouldn’t we be able to import drugs or, at least, drug prices?

If Congress lifted its ban on drug importation, we would be paying drug prices similar to what people in other wealthy countries pay. That’s fair. More important, it would make drugs affordable for millions of Americans who cannot afford them today and do not fill medically necessary prescriptions. It’s also a market-based solution for lowering drug prices.

Now, the Congress has to act.

Here’s more from Just Care:
April 14, 2021
Let’s legalize drug importation and import drug prices
In an opinion piece on addressing high prescription drug prices for The Hill, Gabriel Levitt and Steven Salant argue that Congress should allow drug imports from legitimate pharmacies around the world and cap drug prices at the lowest price paid by other wealthy countries.

Today, all but 1.5 percent of Americans fill their prescriptions in the United States. Most people are worried about the safety of drugs imported. But, many of the same exact drugs sold in the US are available around the world; in the US, you pay 3.5 times more for them. Not surprisingly, three in ten Americans cannot afford to fill their prescriptions.

A large majority of Americans of all political stripes–more than 75 percent–favor drug importation and Medicare drug price negotiation. The authors propose combining policies proposed by Republicans and Democrats to achieve lower drug prices.

The authors explain why importing drugs from certified licensed pharmacies abroad is as safe as buying the drugs in the US. But, the pharmaceutical industry does a good job of scaring people from importing drugs. Consequently, only about 2.3 million Americans import drugs. And, while drug importation is not legal, the FDA has never prosecuted people who import drugs for personal use.

In 2019, the House of Representatives passed HR3, which would have set Medicare prices for 350 drugs over 10 years at a price benchmarked to the average of what other wealthy countries pay, international reference pricing. The Senate did not entertain the bill, and it went nowhere. The bill was a good first step at regulating drug prices, but it covered fewer than five percent of drugs on the market, did not apply to people without insurance, and left it to insurers to decide whether they wanted to piggyback on Medicare rates.

Levitt and Salant propose that Medicare link its drug prices to the lowest prices paid by other high-income countries. They also recommend that a Medicare reference pricing bill must specify that if the drug manufacturer does not agree to the reference price, either its drug cannot be included on the Medicare Part D formulary or the manufacturer loses its patent protection and other companies can manufacture the drug at the reference price.

Savings from reference pricing could be used to fund more drug research. We should not be funding research from the exorbitant prices people who rely on drugs are now forced to pay.

Here’s more from Just Care:

Millions safely import low-cost drugs from abroad

Pelosi drug proposal would bring down drug prices

Prescription drug costs soar for people with Medicare Part D

Coronavirus: Taking supplements poses risks

Coronavirus: Planning ahead for a medical emergency
February 22, 2021
Trump might actually lower drug prices for people with Medicare
In one of his parting acts as president, Donald Trump appears to be trying to lower drug prices for people with Medicare or to wreak vengeance against Pharma for not announcing test results for their COVID-19 vaccines before the election. The Trump administration is working to speed up the process for pricing drugs for people with Medicare in line with what other wealthy countries pay. Many are dubious that Trump’s plan will work, but, for once, he has the right idea, freeing people with Medicare from the high cost of drugs.

Trump’s move looks like revenge against the pharmaceutical industry for waiting until after the election to announce a COVID- 19 vaccine. Regardless, if it were to take effect, it would lower Medicare drug spending significantly. And, the pharmaceutical industry is not happy.
Trump is essentially fast-tracking an executive order he issued in September calling for international reference pricing–pricing drugs at a similar level to peer nations–for some drugs available to people with Medicare. His administration is likely planning to issue an “interim final rule,” which sounds like an oxymoron. But, it would skip the interim rule-making phase and go directly to a final rule.

Many experts believe that pharmaceutical companies will bring lawsuits to stop the rule from taking effect. If they rely on the Republican argument that the administration is trying to impose price controls on a free market, it would be laughable. But, given how many jurors are sympathetic to industry, it would be no surprise if the drug companies win.

To be clear, the prices that would take effect under this rule are no different from the prices Americans pay if they import drugs from abroad. Right now, the government does not allow people to import drugs from abroad, even for personal use, but millions of people do anyway because they are so much cheaper. There is absolutely no reason that we should be paying twice as much as people in peer nations for our drugs.

What’s most interesting is that President Trump’s plan is in line with the Democrats’ House bill, HR3, which would also regulate drug prices for people with Medicare based on the price of drugs in other wealthy countries. However, HR3 extends these Medicare prices to private health insurers, and Trump’s executive order does not. However, HR3 only covers 350 drugs over ten years.

President Trump has another rule that may go into effect that could help lower drug prices. It would end the rebates that go to pharmacy benefit managers (PBMs), which simply inflate the cost of drugs. However, if these rebates ended, there is nothing to stop the drug companies from pocketing the rebate money they would have paid the PBMs and raising the price of their drugs further. Not surprisingly, pharmaceutical companies like this policy.

Curiously, there is a whacky argument put forward by the PBM industry that eliminating rebates would raise the cost of drug insurance premiums in the Medicare Part D prescription drug benefit. We are living in an Orwellian world. The PBM trade association needs to justify its existence.

Here’s more from Just Care:

What would a President Biden do about drug prices?

More than one in three older adults could be taking inappropriate drugs

States charge 26 drugmakers with illegally driving up the price of generic drugs

With drug prices soaring, millions buy drugs abroad

Insurers drive up costs for people with diabetes
November 18, 2020
What would a President Biden do about drug prices?
The latest news is that the pharmaceutical industry is targeting its 2020 campaign contributions at Vice President Biden, rather than President Trump. Kaiser Health News reports a reversal in Pharma’s standard way of operating. The prescription drug companies want to make sure that a Biden presidency would not mean government regulation of drug prices. What would a President Biden do about drug prices?

The US House of Representatives has passed HR3, which would lower drug prices for scores of the most popular drugs to levels near those paid in other wealthy countries over the next ten years. Pharma would have to negotiate with the Department of Health and Human Services regarding prices for these drugs. Everyone in the country would benefit. But, the Senate has not considered it.

Vice-President Biden says he plans to eliminate the barrier that prevents Medicare from using its leverage to negotiate drug prices. While Biden recognizes that everyone in the US needs lower drug prices, his campaign web site does not say that everyone in the nation will benefit from these prices, nor is it clear that these prices will be significantly lower, since he does not say that they will be benchmarked to prices paid in other countries.

Biden proposes establishing a new arm of the US Department of Health and Human Services to assess the value of new specialty drugs. This agency would establish a fair price for these drugs. They would base the price on international pricing, if the drug is already available in other countries. Vice President Biden also proposes allowing private health insurers in the state exchanges, and the individual market writ large, to benefit from the prescription drug prices established at HHS.

In addition, the Vice President would impose a limit on the amount pharmaceutical companies can increase the price of their brand-name and biotech drugs to the rate of inflation. This limit would also apply to “abusively priced” generics. The Vice President does not define abusively priced.

And, the Vice President would allow drug importation from other countries where drugs are determined to be safe. PharmacyChecker’s website lists drug prices from verified pharmacies in other countries. While this proposal would not help as many people as need affordable drugs, it forces Pharma to recognize that the international market will drive down drug prices in this country. Better still would be if private health insurers were required to reimburse members for drugs they purchase abroad.

Finally, Biden proposes improving the supply of generic drugs and eliminating the tax deductions pharmaceutical companies traditionally receive on their advertising spending.

It’s no wonder that Pharma and its allies in the health products industry have given Biden’s campaign more than $5.9 million, according to Open Secrets. Kaiser Health News reports that the Biden campaign has received three times more in campaign contributions from Pharma and its allies than President Trump. If Biden becomes President, the drug companies will need his ear to keep him and Congress from turning his drug pricing proposals into law.

Still, Pharma is targeting the majority of its Congressional campaign contributions to Republicans. Its how it tries to ensure that Republicans in Congress stand behind the drug companies’ right to charge excessive prices.

It’s too early to know whether Biden, if elected, would prioritize lowering prescription drug prices. He should. Drug prices remain one of the top issues among voters. Nine in ten voters say this issue is “very important” or “somewhat important.”

Here’s more from Just Care:
October 14, 2020