The Year in Review in Prescription Drug Pricing

Goodbye, 2019. Hello, 2020! Here is a look at the year in review in prescription drug pricing:

1. States Take a Stand

• In 2019, states passed a record number of laws to rein in high drug prices. California lawmakers passed a groundbreaking bill that would deter Big Pharma from cutting abusive “pay-for-delay” deals. Massachusetts became the first state in the nation to grant its Medicaid program the power to negotiate lower drug prices and to hold companies that refuse to come to the table accountable. Maryland made history by establishing a drug affordability board. And in Maine, bipartisan efforts resulted in a comprehensive slate of prescription drug pricing laws including importation, a prescription drug affordability board, and transparency measures. 

2. Federal Momentum Grows

• The CREATES Act cleared Congress as part of a year-end spending agreement. The bill is expected to save the government $4 billion over 10 years by closing a loophole that had prevented generics from coming to market. Drugs impacted include Revlimid, which costs Part D beneficiaries as much as $2,600 for the first month’s supply. While taken by only 37,500 Americans on Medicare Part D, the drug carried the highest total spending for any drug in the program in 2017. Overdue? Yes. The least Congress could do? Yes. But we’ll take it. 

3. Patient Voices Grow Louder 

• Patients across America are continuing to speak out against ever-increasing prescription drug prices. They’ve testified in statehouses and in Washington, DC and met with legislators in dozens of in-person meetings. And they’ve shared more than 20,000 of their stories with Patients For Affordable Drugs that detail the heartbreaking choices they’re forced to make to afford prescriptions, from skipping doses, to cutting pills in half, to forgoing food. The stories of our brave patient advocates can be found here.

4. Pharma Loses Its Edge

• Pharma is losing its edge in Washington. The U.S.-Mexico-Canada Agreement (USMCA) passed the House before year’s end. Stripped from the deal were enhanced biologic patent exclusivity periods in Mexico and Canada that would have blocked competition and kept prices high. The deal is evidence that progress on drug pricing in gridlocked Washington and in the face of the deep-pocketed drug lobby is possible.

5. It’s Not Perfect, But It’s Progress

• We know the road ahead is long, but let’s not forget how far we’ve come. House passage of H.R. 3, the Elijah E. Cummings Lower Drug Costs Now Act, marked a major victory in the fight for lower drug prices. The landmark legislation would expand Medicare benefits, support innovation, and save America billions of dollars from lower drug prices. The bipartisan Prescription Drug Pricing Reduction Act of 2019 cleared the Senate Finance Committee and would cap how much drugmakers could hike prices on medications in Medicare, for the first time, ever. Congress will have another opportunity to work together as it sets about this spring to fund popular health extenders.

WASHINGTON, D.C. — In response to the House Energy and Commerce Committee passing the CREATES Act and legislation to end pay-for-delay tactics, David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now, issued the following statement:

“Many Americans have lost faith in Congress’s ability to fix problems. Today, the Energy and Commerce Committee proved that small but important bipartisan reforms are still possible. I appreciate Chairman Pallone, Ranking Member Walden, and members on both sides of the aisle for working on one of the most critical issues facing Americans — skyrocketing prescription drug prices.

“Today’s actions must be the first step by this Congress on the path to lower drug prices, not the last. Even when these bills are signed into law, Americans will still go into debt at the hands of drug companies.

“More action is required to fix our broken system and lower prescription drug prices. We look forward to working with Congress to see further reforms enacted.”

BACKGROUND:

REMS ABUSES: Brand drug companies use a safety program called Risk Evaluation and Mitigation Strategies (REMS) as a pretext for not selling drug samples to generic companies, which need the brand product in order to develop an equivalent and lower-priced competitor. The CREATES Act would address delay tactics that are used by brand drug manufacturers to block lower-priced generic drugs. The U.S. could save $3.9 billion by stopping this abuse, which the FDA has called “unfair and exploitative.”

PAY-FOR-DELAY: Brand drug companies pay off generic companies that plan to bring a competitor to market. In exchange for this payment, the generic manufacturer delays its product’s entry into the market. HR 1449, the Protecting Consumer Access to Generic Drugs Act  would limit deals in which brand and generic drug manufacturers use anti-competitive pay-off agreements to delay cheaper generic and biosimilar drugs from reaching patients.

PATIENT PERSPECTIVE:

Celgene’s cancer medication, Revlimid, tops a list maintained by the FDA that highlights which brand pharmaceutical corporations are blocking generic competition. The maneuver puts patients like Pam Holt’s life and financial wellbeing at risk. The cancer patient took on $10,000 in debt and refinanced her home to afford Revlimid, telling Patients For Affordable Drugs:

“Celgene, the company that makes Revlimid, should be giving samples to generic drug makers so they can make a cheaper version, but it repeatedly refused to do so. Celgene is abusing a loophole in our laws to keep the price high. The company keeps raising the price simply because it can. And, I keep taking on debt.”

###

WASHINGTON, D.C. — New data from the Centers For Medicare and Medicaid Services emphasized the need for Congress to pass the CREATES Act, a bipartisan bill that would lower drug prices and save taxpayers billions.

The CMS Drug Spending Dashboard revealed the cancer drug Revlimid, while taken by only 37,500 Americans on Medicare Part D, was responsible for the highest total spending for any drug in the program in 2017. Patients on Part D pay out-of-pocket costs based on the list prices of medications. Revlimid currently costs $21,000 per month, meaning Medicare Part D beneficiaries owe $2,600 for the first month’s supply of the medication.

“The CREATES Act would lower drug prices by stopping corporations like Celgene from blocking competition,” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now. “This report reveals why this bill is so important. If passed, American patients would get access to less-expensive cancer drugs and taxpayers would save $3.9 billion.”

Celgene, the drug corporation that makes Revlimid, refuses to provide samples of the drug to generic drugmakers by hiding behind a federal safety program called Risk Evaluation and Mitigation Strategies.

The FDA released a list of 150 brand drugmakers blocking generic drugmakers’ access to their products. At the time, FDA Commissioner Scott Gottlieb said, “I want to be very clear: a path to securing samples of brand drugs for the purpose of generic drug development should always be available.” Last week, Health and Human Services Secretary Alex Azarannounced that the Trump Administration supported passage of the CREATES Act.

According to polling conducted by the Republican-led research firm GS Strategy Group,  voters support passage of the CREATES Act by an 83-to-9 margin.

###

WASHINGTON, D.C. — During a noteworthy exchange at today’s Energy and Commerce Committee hearing, Health and Human Services Secretary Alex Azar publicly endorsed four legislative proposals to lower drug prices and help patients: curbing REMS abuses, ending pay-for-delay deals, banning evergreening, and ending sham Citizen Petitions.
 
“With the Trump Administration endorsing four common-sense solutions to address a problem eight out of 10 American voters agree must be solved, it’s time for Congress to act,” said Ben Wakana, Executive Director of Patients For Affordable Drugs Now. “Congress should pass these proposals immediately to crack down on anticompetitive behavior and stop insidious tactics that disrupt the free market and hurt patients.”
 
During today’s hearing, Secretary Azar told Democratic Congressman Peter Welch (VT), the administration supported legislation to fix:
 
REMS ABUSES: Brand drug companies use a safety program called Risk Evaluation and Mitigation Strategies (REMS) as a pretext for not selling drug samples to generic companies, which need the brand product in order to develop an equivalent and lower-priced competitor. The CREATES Act would address delay tactics that are used by brand drug manufacturers to block lower-priced generic drugs. The U.S. could save $3.9 billion by stopping this abuse, which the FDA has called “unfair and exploitative.”

PAY-FOR-DELAY: Brand drug companies pay off generic companies that plan to bring a competitor to market. In exchange for this payment, the generic manufacturer delays its product’s entry into the market. Legislation would limit deals in which brand and generic drug manufacturers use anti-competitive pay-off agreements to delay cheaper generic and biosimilar drugs from reaching patients.
 
EVERGREENING: Drug corporations often change drugs incrementally and patent the new product, which extends a corporations’ monopoly pricing power. For example, a company might move from a tablet to a capsule and apply for a new patent. This gaming of the system should not be permitted under U.S. law.
 
CITIZEN PETITIONS: Brand drug makers were behind 92 percent of all citizen petitions filed between 2011 and 2015 –– all aimed at blocking cheaper generic drugs. The FDA denied more than nine of every 10 of those petitions. Congress should stop sham citizen petitions.

TRANSCRIPT
 
Congressman Peter Welch: You do support, as I understand it, ending pay-for-delay. Is that the case?
 
Secretary Alex Azar: We do. In fact, our budget has a unique pay-for-delay provision in that if you do a pay-for-delay agreement, you would actually be penalized in the Medicare Part B system. 
 
Welch: Right. And you want to curb the REMS abuses?
 
Azar: Absolutely do. So, the CREATES Act and working with you on that. 
 
Welch: Right. And the product hopping that has been occurring is another way. Are you opposed to that as well?
 
Azar: I want to make sure I’m understanding. 
 
Welch: It’s the abuse of Citizen Petitions, it’s product hopping, and other forms of evergreening. 

[Crosstalk]
 
Azar: Yes, we want to crack down on any forms of manipulation or evergreening of patents and exclusivity beyond what the original deals were.  

###

WASHINGTON, D.C. — Patients For Affordable Drugs Now applauded and thanked the Senate Judiciary Committee for passing the bipartisan CREATES Act — a bill that aims to lower drug prices by speeding generics to market. In response to the committee voting 16 to 5 to move the bill for consideration by the full Senate, Executive Director Ben Wakana issued the following statement:

“Months of intense opposition from Big Pharma could not kill this bill, and nothing will stop patients from demanding solutions like the CREATES Act to lower drug prices. Chairman Grassley, Senator Leahy, and all committee members voting yes deserve credit for fighting for patients today. Drug corporations should stop safeguarding bad actors and instead focus on getting affordable medicine to Americans who need it.”

BACKGROUND:

• The CREATES Act (S. 974 and H.R. 2212) would stop big drug companies from blocking competition by refusing to allow their brand name drugs to be used in testing needed to get approval for generic competitors. If passed, patients would get access to lower-priced generic drugs faster.
   
• Eighty six organizations representing patients, doctors, the research and development community, and large employers sent letters urging Congress to pass the CREATES Act.
   
• The Congressional Budget Office estimated the CREATES Act would save taxpayers $3.8 billion over 10 years.
   
• In May, the FDA released a list of more than 50 drug makers accused by generic drug corporations of stalling providing samples that would increase competition and lower prices. According to Kaiser Health News, the drug makers on the FDA’s list are also responsible for double-digit percentage price hikes since 2012, which cost Medicare and Medicaid nearly $12 billion in 2016.
   
• The pharmaceutical lobby amped up lobbying to $25 million last year and continues to oppose the CREATES Act despite calls from Scott Gottlieb, conservative groups like FreedomWorks, and Harvard academics to end REMS abuses.

###

WASHINGTON, D.C. — Big Pharma is lobbying Congress to repeal a rule that requires drug corporations to pay a higher share of prescription costs for people on Medicare. At the same time, patient advocates descended on Washington, D.C., to tell lawmakers not cave to pharma lobbying without supporting the CREATES Act, a bill to lower drug prices.

“If Congress caves to pharma and repeals drug cost protections for Medicare beneficiaries in the donut hole, the least they can do is stop stalling and pass the bipartisan CREATES Act,” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now.

According to news reports, lobbyists and lawmakers “are working to relax a law that would force drug makers to pay a higher percentage of costs for Medicare beneficiaries.”

The CREATES Act (S. 974 and H.R. 2212) would stop big drug companies from blocking competition by refusing to allow their brand name drugs to be used in testing needed to get approval for generic competitors. If passed, patients would get access to lower-priced generic drugs faster.

Among the patients visiting lawmakers are:

• Lisa Driggers, of South Carolina, who said: “Just one of my husband’s chemo drugs is over $22,639.00 for a 21-day supply. Ungodly!”
• Bob Parker, of Colorado, who wrote: “For most of the past 8 years, I have cost the government about $15,000 a month. I have prostate cancer.”
• Pam Holt, of Indiana, who has taken on $10,000 in debt to stay alive and afford her prescriptions since her 2012 cancer diagnosis.

The pharmaceutical lobby spent $25 million last year and continues to oppose the CREATES Act despite calls from FDA Commissioner Scott Gottlieb, FreedomWorks, and the Heritage Foundation to pass the bill.

A new national poll shows that Americans across the political spectrum want Congress to make lower drug prices a top priority, and voters support passage of the CREATES Act by an 83 to 9 margin. According to a survey from the Republican-led research firm GS Strategies, 85 percent of voters nationwide say lowering the cost of prescription drugs should be a leading priority for Congress compared to just 12 percent who consider it a low priority.

Patients For Affordable Drugs Now aims to act as a counterbalance to drug corporation influence and conducts on-the-ground advocacy in support of candidates and policies to curb drug prices. It does not accept funding from any organizations that profit from the development or distribution of prescription drugs.

###