Eighty-three is a pretty impressive number. That’s the percentage of Americans who favor empowering the federal government to negotiate prices with drugmakers. Even 7 of 10 Republicans agree, according to polling from KFF, a respected source of health news and statistics.
Those drug companies, by weaponizing huge war chests and armies of lobbyists, have long defied public opinion and thwarted every effort to give Washington, D.C., bargaining authority. But now, hopefully, that’s about to change.
A bill that’s poised to pass Congress would signal small but significant shifts in the balance of power. For the first time, the Feds would be free to engage in price talks over a gradually expanding menu of medicines. The measure would also limit an individual’s drug costs under Medicare to $2,000 per year, mandate pharmaceutical companies to pay rebates if their price increases outpace inflation and provide free vaccines for seniors.
This legislation does what Congress is supposed to do but seldom achieves — placing the public interest ahead of the private interest of a rich and ravenous force like the drug industry.
Free markets generally provide the best solutions to economic problems, and Washington’s ability to improve outcomes through regulation is vastly overrated. But drug companies have had their chance and consistently abused their influence. As David Mitchell, president of the advocacy group Patients for Affordable Drugs, told The Washington Post: “Now, finally, like every other country in the world, we’ll be able to negotiate with drug companies on expensive drugs. It is a truly historic breakthrough many, many years in the making.”
The bill is not a done deal. It would require the support of all 50 Democratic senators, and one frequent dissident, Kyrsten Sinema of Arizona, remains a wild card. Moreover, relatively few drugs would be subject to the bargaining process, and some pressing problems, like the cost of insulin, are not covered at all.
Yet the measure would rank as a historic breakthrough because it could set a critical precedent and lead to more ambitious reforms in the future. Moreover, it’s not just wildly popular, but widely needed. “One in 5 older adults still report difficulty affording their prescription drugs, including 17 percent of older adults with some type of prescription drug coverage,” reports KFF.
The latest polling, adds the Medical Economics journal, “finds 3 in 10 adults (29 percent), including 4 in 10 (43 percent) adults with household incomes of less than $40,000, saying they have either not filled a prescription, cut pills in half or skipped doses, or taken an over-the-counter medication instead due to the cost of their prescription drugs.”
Those hardships are aggravated by America’s unregulated marketplace. A RAND Corporation study compared United States drug prices to those in 32 other countries and concluded that U.S. consumers pay 256 percent more. The gap is even larger for brand-name drugs, as opposed to lower-cost generics, with U.S. prices averaging 3.44 times those in comparison nations. “It’s just for the brand-name drugs that we pay through the nose,” notes Andrew Mulcahy, the study’s main author.
Those brand names, often backed by huge TV advertising campaigns (“Ask your doctor about …”), are cash cows for the industry. Take Humira, an anti-inflammatory remedy used to treat conditions like rheumatoid arthritis and colitis. The drug is 423 percent more expensive in the U.S. than in the United Kingdom and 186 percent more costly than in Germany. That disparity helps explain why its maker, AbbVie, has earned almost $200 billion from Humira in the last 20 years, reports the website Industry Dive.
And that’s why companies like AbbVie have spent lavishly to protect those profits, lobbying “heavily to avoid anything that resembles government price controls for its products,” writes The Washington Post, citing the website Open Secrets. “They are on pace to break records in 2022 with $187 million in lobbying activity reported so far, with an army of 1,587 registered lobbyists (57 percent of them former government officials).”
Drugmakers certainly deserve to reap healthy profits when they produce a valuable drug, and we all benefit when they divert some of those profits into researching future breakthroughs. But their argument that price limits would destroy their ability to find new therapies is absurd, and the public knows that. KFF finds that only 6 percent of Americans agree that “drug companies need to charge high prices in order to fund the innovative research necessary for developing new drugs.”
This bill reflects a rare combination: It’s both popular and productive. Congress should pass it right away.
Steven Roberts teaches politics and journalism at George Washington University. He can be contacted by email at stevecokie@gmail.com.
