Hearing on Medicine Affordability Highlights Need to Challenge Pharmaceutical Industry’s Business Model
Jan. 29, 2019
Hearing on Medicine Affordability Highlights Need to Challenge Pharmaceutical Industry’s Business Model
Statement of Peter Maybarduk, Director, Public Citizen’s Access to Medicines Program
Note: Today, the U.S. Senate Committee on Finance, led by Chairman Chuck Grassley (R-Iowa), held a hearing examining how companies’ actions have raised the cost of prescription prices for Americans.
Public Citizen appreciates Sen. Grassley for his decades of challenging the role of pharmaceutical corruption in making medications unaffordable. We have a real chance of passing meaningful legislation to make lifesaving medications accessible to everyone.
We can expect to see two types of meaningful legislation to lower drug prices: those that curb abuses of the business model and those that challenge the business model itself.
Sen. Grassley is most interested in the former: curbing abuses of the pharmaceutical industry’s business model. This includes the CREATES Act and banning pay-for-delay, two meaningful reforms that Congress could and should pass this year. Both are premised on fundamental acceptance of the business model itself.
But this model is built on monopoly power and is the root of industry price abuse. This needs to change, which requires more sweeping reforms – namely, increasing the consumers’ negotiating power, blocking price spikes and curbing monopolies.
Several congressional leaders have introduced proposals to do this. In particular, U.S. Rep. Lloyd Doggett’s (D-Texas) Medicare Negotiation and Competitive Licensing Act would give us negotiating power with teeth while challenging monopoly power.
Other outstanding proposals include the Stop Price Gouging Act – which would block EpiPen-style spikes – and the Prescription Drug Price Relief Act, which would introduce generic competition when branded products are unreasonably priced.
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