STATEMENT: Americans Will Pay Lower Prices Under New House Drug Plan

WASHINGTON, D.C. — David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now, issued the following statement in response to a draft plan in the House of Representatives that would lower drug prices for Americans through negotiations with drug corporations.

“If reports are accurate, this plan would deliver significant relief for patients and taxpayers. The proposal would lower prescription drug prices for American patients while protecting access to medicine and increasing funding for innovation.

“Americans pay two to three times what people in other nations pay for prescription drugs. Why? Other countries negotiate — we don’t. This proposal will ensure that Americans experience lower drug prices whether covered by a government plan or private insurance. It will be a bold step forward.”

BACKGROUND:

According to reports, the plan includes the following key provisions that would:

• End the ban on Medicare negotiating directly with drug companies to lower prescription drug prices and empower HHS to negotiate prices for the 250 most costly drugs each year.
• Establish a maximum fair price based on an international pricing index. Americans will pay no more than 120 percent what other wealthy nations pay (Canada, United Kingdom, Germany, France, Australia, Japan), and negotiations could take that price lower.
• Ensure that Americans –– regardless of insurance type –– have access to lower-priced drugs. A drug corporation would be required to offer the negotiated price to Medicare and non-Medicare insurance plans — this includes people who buy insurance through their employer, the VA, Healthcare.gov, etc. If a drug company overcharges Medicare or fails to offer the fair price to people, it will be subject to a penalty of 10 times the difference between the price charged and the maximum fair price for the drug.
• Stop drug companies from increasing prices on all drugs faster than the rate of inflation, and impose penalties on drug companies if prices rise above inflation. If a drug company has raised the price of a drug in Medicare Part B or D above the rate of inflation since 2016, it can either lower the price or be required to pay the entire price above inflation back to the Treasury.
• Cap seniors’ out-of-pocket costs for prescription drugs at $2,000 per year. Currently, out-of-pocket costs for seniors on Medicare can be over $15,000 per year.
• Direct savings to new drug research and innovation at the NIH.

Medicare Part D provides coverage for 43 million Americans’ prescription drug needs. And spending has been on an untenable path.

• Nearly 1 in 3 adults report not taking their medicines as prescribed because of the cost — (KFF)
• Eighty six percent of Americans — majorities of Democrats, Republicans, and Independents — support allowing Medicare to negotiate for lower prescription drug prices. But under current law, Medicare is prohibited from negotiating directly with drug companies on behalf of taxpayers and Medicare beneficiaries. — (KFF)
• Eighty percent of Americans say Congress’s top priority should be action to lower drug prices. — (Harvard/Politico)
• Drug prices and Medicare drug spending are out of control. Americans pay twice as much for prescription drugs as other nations. — (The Atlantic)

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WASHINGTON, D.C. — Big Pharma has spent millions of dollars on a full-court press to stop the Trump administration from implementing an International Pricing Index for one reason: The plan will lower drug prices in America. Today, industry lobbyists will meet with administration officials to press their case that Americans should continue to pay twice what other countries pay for drugs.

“We have no doubt the drug corporations will dust off their favorite scare tactics — like ‘rationing medicine,’ ‘reducing access,’ and ‘socialism,’” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now. “But the claims are outrageous, offensive, and wrong.”

Here are the facts:

FACT CHECK: PhRMA’s False Claims About the Medicare Part B demonstration

MYTH #1: The Part B demonstration will restrict access to lifesaving drugs.
FACTS:

• All protected classes of drugs in Medicare will be maintained.
  • HHS: “We propose no changes to the Medicare benefit, just more discounts from drug companies.”
  • Bloomberg: “The aim is to drive down the cost of those medications by 30 percent.”
• There is no evidence the Part B demonstration would harm patient access to drugs unless drug corporations choose to withhold drugs from patients.
  • HHS: The proposal is to “lower drug prices—without any restrictions on patient access.”
• The Part B demonstration does nothing to slow the FDA approval process or change U.S. incentives for new drug approval.
  • Multinational drug corporations will still want early access to the largest market and higher prices in the U.S.
  • It would not change “regulatory incentives such as accelerated approval and priority review mechanisms” which Forbes points out play a key role in early approval in the U.S.
• Americans ration drugs today based on price.
  • NPR: “Insulin’s high cost leads to lethal rationing.”
    • In 2019 alone, deaths have included: Jesimya David Scherer-Radcliff, 21; Kayla Davis, 29; Josh Wilkerson, 27; and Jada Louis, 24.
  • CDC: “Among adults with diagnosed diabetes who were prescribed medication in the past 12 months, 13.2% did not take their medication as prescribed, and 24.4% asked their doctor for a lower-cost medication.”
  • Vox: “It means that our system, even if we don’t like to admit it, has to pick and choose who gets access to lifesaving drugs.”

MYTH #2: The Part B demonstration will establish drug prices that are impossibly low — stifling innovation, damaging drug companies and hurting our health system.
FACTS:

• Americans would still pay Pharma more for drugs than other developed countries.
  • The New York Times: “A government study that said Medicare was paying 80 percent more than other advanced industrial countries for some of the most costly physician-administered medicines.”
  • Secretary Azar: “Over the next five years under this model, we will go from paying 180 percent of what other countries pay for these drugs to 126 percent of what they pay.”
• Lowering prices in Part B will have little to no impact on innovation.
  • National Academy of Sciences: “NIH funding contributed to published research associated with every one of the 210 new drugs approved by the Food and Drug Administration from 2010–2016. “
  • HHS: “The possible savings American patients would receive over five years represents less than 1 percent of pharmaceutical R&D spending during that time; and the pharmaceutical industry has offered no evidence of that amount having a meaningful impact on innovation.”
• Drug companies can easily make that up by reducing advertising and marketing spending.
  • Washington Post: “Nine out of 10 big pharmaceutical companies spend more on marketing than on research.”
  • JAMA: “From 1997 through 2016…DTC prescription drug advertising increased from $1.3 billion to $6 billion with a shift toward advertising high-cost biologics and cancer immunotherapies.”

MYTH #3: The demonstration will result in worse care for patients. The government should not replace a market-based system with government price setting.
FACTS:

• We do not have a market-based system in the United States. Our system is completely based on laws and regulations.
  • Avik Roy, Foundation for Research on Equal Opportunity: “Medicare Part B does not represent a “free market” for prescription drugs. Instead, the program uses government-administered reimbursement rates to pay for drugs. The structure of this system is far removed from how a true market would work.”
    Peter Bach, MD, Director of Memorial Sloan Kettering’s Center for Health Policy and Outcomes: “There is no free market for prescription drugs in the U.S. The U.S. system of drug pricing is completely built on a foundation of government imposed laws and regulations that grant monopolies and market power to large players.”
  • JAMA: “High drug prices are the result of the approach the United States has taken to granting government-protected monopolies to drug manufacturers, combined with coverage requirements imposed on government-funded drug benefits.”
• The 16 countries used for reference by and large have better health outcomes and longer life expectancy than the U.S., while spending about half as much per capita for health expenditures.
  • Kaiser Family Foundation and Peterson Center on Healthcare: Of the 16 other developed economies in the IPI, Americans have worse health outcomes than: Austria, France, Germany, Japan, Sweden, and the United Kingdom.
  • Central Intelligence Agency: Of the 16 other developed economies in the IPI, Americans have shorter life expectancies than 13 of them: Austria, Belgium, Canada, Finland, France, Germany, Greece, Ireland, Italy, Japan, Spain, Sweden, and the United Kingdom.
  • World Bank: Of the 16 other developed economies in the IPI, Americans spend more on health care as a percentage of GDP than all of them: Austria, Belgium, Canada, Czech Republic, Finland, France, Germany, Greece, Ireland, Italy, Japan, Portugal, Slovakia, Spain, Sweden, and the United Kingdom.
• The current system is broken.
  • CNN: “Americans pay anywhere from two to six times more than the rest of the world for brand name prescription drugs.”
  • Wall Street Journal: “Compared with the U.S., drug prices are far lower in many overseas countries…Critics have long held that the [U.S.] percentage-based ‘add-on’ fee creates incentives for doctors to use higher-priced drugs.”

MYTH #4: Americans do not support the Part B proposed changes.
FACTS:

• According to a GOP pollster, Americans overwhelmingly support the International Pricing Index to lower drug prices.
  • Voters support the HHS proposal to lower drug prices by a 71-point margin (80 percent support vs. 9 percent oppose).
  • Majorities from both parties agree that Democrats and Republicans in Congress should support the proposal.
  • Notably, 8 in 10 voters believe the proposal will result in better care or have no impact on the care they receive.

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WASHINGTON, D.C. — With the introduction of the bipartisan We PAID Act of 2019, federal lawmakers are taking a stand today to assure drug companies set reasonable prices for prescription drugs funded with taxpayer investment. The We Protect American Investment in Drugs Act (We PAID), sponsored by Senators Chris Van Hollen (D-MD) and Rick Scott (R-FL), would allow for the creation of an independent body representing taxpayers to engage the pharmaceutical industry on drug pricing and limit annual price increases when taxpayer-funded research leads to the creation of a new drug. In response to the news, David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now, issued the following statement:

“The We PAID Act will help American patients get innovative new drugs supported by taxpayer investment while ensuring fair prices at the pharmacy counter. We are grateful for the leadership of Senators Chris Van Hollen and Rick Scott. As a patient with incurable cancer who lives with hope for a cure that will be in reach of all Americans, this legislation carries special significance.

“The National Institutes of Health (NIH) is the world’s single largest funder of biomedical science supporting research and development of some of the most innovative and expensive drugs. New cell and gene therapies based on science paid for by taxpayers through the NIH are coming to market at prices ranging from $400,000 to more than $2 million — prices that are unsustainable.

“The We PAID Act aims to establish a process to ensure these new drugs not only are invented but are priced to maximize public health. We look forward to working for its enactment with members of Congress in both chambers.”

BACKGROUND:

• Eighty percent of Americans say Congress’s top priority should be action to lower drug prices. (Politico)
• All of the 210 drugs approved by the Food and Drug Administration from 2010-2016 were based on science funded by taxpayers through the NIH. (Proceedings of the National Academy of Sciences)
• Around 400 clinical trials are underway for gene therapies that will be used to treat much larger populations. (Alliance for Regenerative Medicine)
• A report by Patients For Affordable Drugs details how taxpayers invested at least $300 million into a potential cure for sickle cell disease and encourages the NIH to ensure final price accounts for public investment. (P4AD)

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WASHINGTON, D.C. — In response to the news that the Senate Finance Committee Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) released a slate of reforms to lower prescription drug prices for patients and taxpayers, David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now, issued the following statement:

“Americans are demanding action to lower drug prices, and the Senate Finance Committee has taken an important step forward with its proposals today. Most importantly, the Prescription Drug Pricing Reduction Act of 2019 would discourage Big Pharma from increasing the prices of prescription drugs at multiple times the rate of inflation each year. It would also cap seniors’ out of pocket costs in Medicare Part D at $3,100 annually. These changes will help the most vulnerable citizens afford prescription drugs, save taxpayers money, and hold the line on drug price and premium increases.

“The package protects innovation and maintains patient access to innovative drugs. And, by capping increases at the rate of inflation, it ensures that we don’t have to pay huge increases on initial high launch prices of drugs.

“Other elements of the package are significant, including the increase in the rebate cap and limits on spread pricing by PBMs in Medicaid.

“We urge members of the Senate Finance Committee to advance this package. Members of Congress must guard at every turn against changes that would weaken the bill. Voters have given Congress a mandate to lower drug prices, and patients can’t afford to wait any longer.”

BACKGROUND:

While we are encouraged by many of the changes the Senate Finance Committee has proposed, we also have a number of questions and concerns. We are hopeful the Committee will consider changes that:

• Ensure patients benefit from inflation-based rebates in Medicare Part B and D.Under the current draft, if a pharmaceutical manufacturer increases list prices for certain drugs above inflation, drug companies must pay a rebate to HHS and thus the Medicare Supplemental Medical Insurance Trust Fund. We hope the committee will clarify how patients will experience savings from the rebate if a drug company gouges Medicare beneficiaries.
• Avoid burdening state Medicaid programs with extraordinarily expensive drugs. The current problem in our system isn’t Medicaid’s inability to pay for drugs over time — it’s the high price of drugs set by drug corporations. States already have flexibility to implement unique payment models, and the bill (including Section 208) does little to lower the list price of drugs that are bankrupting state Medicaid programs.
• Lower the list price of drugs: The bill could go much further to address the list prices of prescription drugs. America continues to pay two to three times more than other countries for the same prescription drugs because our government does not negotiate to get the best possible deal for citizens, unlike every other developed nation.

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WASHINGTON, D.C. — Patients For Affordable Drugs Now today placed a six-figure ad buy in support of the administration’s proposed reforms to Medicare Part B that will lower drug prices and reduce patient out-of-pocket costs. As part of the campaign, TV and digital ads will tell the story of Ruth Rinehart, a cancer patient who went bankrupt and lost her home due to the price of her Part B prescription drugs. She urges Congress and the Administration to move forward and implement an International Pricing Index.

Watch the ad here. The six-figure buy will begin today. It will air on “Fox & Friends” and nationwide on YouTube, Twitter, and other digital platforms.

“Big Pharma is trying to stop President Trump from delivering on his promise to bring U.S. drug prices in line with what other nations pay,” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now. “Drug corporations deployed all the usual scare tactics and threats to stop this powerful proposal. We are redoubling our efforts to see that it is implemented.”

Currently, Americans pay far more for prescription drugs than other wealthy nations. Under the draft proposal from the Department of Health and Human Services, the price Americans pay for expensive infused drugs in Medicare would fall from 80 percent more than other wealthy nations to only 26 percent more. The proposed rule is currently under review by the Office of Management and Budget. The drug industry has consistently attacked the proposal because the changes would lower prices while ensuring patient access to drugs.

Today’s media buy is part of Patients For Affordable Drugs Now’s ongoing campaign in support of the HHS’ International Pricing Index proposal. The campaign, which launched in January, includes TV and digital advertisements, patient fly-ins, polling, and videos featuring patients who stand to access more affordable drugs under the proposal.

By a 71-point margin, voters support HHS’ proposal to lower drug prices in Medicare Part B by implementing the International Pricing Index (80 percent support vs. 9 percent oppose). Majorities from both parties believe Democrats and Republicans in Congress should support the proposal that would lower prices for infused drugs administered in physician offices and hospitals. Importantly, eight in 10 voters believe the proposal will result in better care or have no impact on the care they receive. Click here to read the poll.

“Ruth” SCRIPT

I’ve had primary immune deficiency for over 25 years.

When we couldn’t afford my drugs any longer, we filed for bankruptcy and lost our home.

There’s a proposal in Washington to bring prices in line with what other countries pay.

It would lower the price of our most expensive drugs by 30 percent.

The International Pricing Index would be good for patients like me.

Contact your elected official. Tell them to support Trump’s plan to lower drug prices.

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KEY POINTS:

• “More than 3,400 drugs have boosted their prices in the first six months of 2019, an increase of 17% in the number of drug hikes from a year earlier.”
• “The average price hike is 10.5%, or 5 times the rate of inflation.”
• “The drug hikes come at a time when lawmakers and the Trump administration have vowed to address the problem of rising prescription costs.”

CBS News // July 1, 2019

Price hikes on prescription drugs are surging in 2019, despite vows from lawmakers and the Trump administration to rein in pharmaceutical costs.

So far in 2019, more than 3,400 drugs have boosted their prices, a 17% increase compared with the roughly 2,900 drug price increases at the same time in 2018, according to a new analysis by Rx Savings Solutions, a consultant to health plans and employers.

The price increases come at a time when lawmakers and consumers are increasingly concerned about the escalating cost of medications, which are far outpacing wage growth and the cost of living. Four of 5 Americans believe the cost of prescription drugs is unreasonable, according to a study earlier this year from the Kaiser Family Foundation. About one-third of patients say they’re skipping prescription medicine because of the cost, the survey found.

“In the political climate we live in and the conversations we’re having, that there are more drug price increases this year — you would think that wouldn’t be the case,” said Michael Rea, founder and CEO of Rx Savings Solutions. “It defines the difficulty that consumers have.”

Triple-digit price increases seen

To be sure, the hikes on more than 3,400 drugs represent a small share of the overall pharmaceutical market. But for patients who rely on one of those medicines, the costs can add to rapidly rising health care expenditures and create dilemmas about how to pay for their care. 

The average price hike for those 3,400 drugs stands at 10.5%, or about 5 times the rate of inflation, the study found. About 41 drugs have boosted their prices by more than 100%, including one version of the antidepressant fluoxetine — also known as Prozac — whose cost has surged  879%, Rx Savings Solutions said.

Aside from fluoxetine, other commonly used drugs with big price increases in 2019 are:

• Mometasone 0.1% Topical Cream. This topical steroid has increased 381% this year, Rx Savings Solutions found.
• Promethazine/Codeine 6.25-10mg/5mL solution. This pain reliever and cough medication rose 326%, Rx Savings Solutions said
• Guanfacine 2mg tablet. This ADHD treatment rose 118%, the study found.

An “inelastic market”

Drug prices are rising because of a combination of pressure from shareholders to deliver higher profits and what Rea calls an “inelastic market.”

“It’s a good that people need, in many cases in order to stay alive,” he says. “You have a lot of flexibility to drive prices higher and higher.”

Ask pharmacist if cheaper versions available

Consumers should try to find as much information as they can about their treatment options, such as whether another version of the drug or a similar medication, might offer a better value, Rea says. 

Researching drug prices can also deliver savings, he says. Until recently, pharmacists weren’t allowed to provide pricing data because of their contracts with pharmacy benefit managers, but a Trump administration rule now bars these gag orders. Still, you’ll have to ask your pharmacist for price data, because they don’t have to volunteer it.

It soon may get slightly easier to get basic cost information under a new rule announced by the Trump administration last month, which will require pharmaceutical companies to reveal the price for many prescription drugs in TV commercials. The rule is expected to go into effect over the summer.

Even so, it can be difficult for consumers to get a handle on actual prices, given rebates and discounts offered by insurers and their pharmacy benefit managers off of inflated list prices. 

“We don’t have an open and efficient market,” Rea noted. “Those things lead to this environment and to higher prices.”

That’s an issue with insulin, which Type 1 diabetics require to stay alive. Even though the medication was discovered nearly a century ago, its price has more than doubled over 5 years, causing financial hardship for many diabetics and prompting some to ration the medication to cut costs. In some cases, those decisions have proved fatal. 

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WASHINGTON, D.C. — In response to today’s HELP Committee vote to include the FAIR Drug Pricing Act in the Lower Health Care Costs Act of 2019, Patients For Affordable Drugs Now Executive Director Ben Wakana issued the following statement:

“If drug corporations want to gouge patients, the public deserves to know exactly why. Accountability and transparency are the principles driving the FAIR Drug Pricing Act, a common sense, bipartisan reform.

“We thank Chairman Alexander and Ranking Member Murray for leading a robust and productive debate on the Lower Health Care Costs Act. And we applaud Senators Baldwin, Braun, Smith, and Murkowski for their relentless efforts to shepherd this critical bill through the process. We hope this bill will be passed by the full Senate expeditiously.”

BACKGROUND

The FAIR Drug Pricing Act requires transparency from drug manufacturers that increase a drug price by more than 10 percent over 1 year or 25 percent over 3 years.

After a corresponding price hike, drug manufacturers must submit a report to the Department of Health and Human Services that includes:

• The percentage by which the drug price will be increased
• Justification for the price increase
• Current price of drug and a history of all price increases since the drug was approved by the FDA
• List of all manufacturer expenditures for:
  • Materials, manufacturing, and patents/licensing
  • Research and development
  • Percent of funds spent on research and development that came from federal coffers
  • Total revenue and net profit reaped from the drug’s sale for each year since its FDA approval
  • Total marketing and advertising costs for the drug

The bill is led by Senators Baldwin (D-WI), Braun (R-IN), Murkowski (R-AK), and Smith (D-MN).

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WASHINGTON, D.C. — In response to news that the U.S. Department of Health and Human Services’ proposal to lower drug prices in Medicare Part B is under review by the Office of Management and Budget, Patients For Affordable Drugs Now Executive Director Ben Wakana issued the following statement:

“We are emphatic in our support of the proposed International Pricing Index for Medicare Part B. It is a bold step forward to lower drug prices, which patients desperately want and the country needs.

“We hope the Trump Administration will finalize this rule to tackle head-on the fact that Americans pay twice as much for drugs than citizens in other wealthy countries.

“Don’t be fooled by Big Pharma’s spin. There is no evidence the proposed Part B changes would impact patient access to drugs.”

BACKGROUND

• Recent polling shows how voters across the country overwhelmingly favor — by a 71-point margin — bringing Medicare Part B drugs in line with what people in other wealthy nations pay, and eight in 10 voters believe the proposal will result in better care or have no impact on the care they receive.
• “Americans pay anywhere from two to six times more than the rest of the world for brand name prescription drugs.”
• More than 1,500 patient advocates signed a petition urging the administration to move forward with the proposal to lower drug prices in Medicare Part B.
• Patients For Affordable Drugs Now released a TV ad, “Ruth,” about a Florida patient who tells the story of how her family went bankrupt and lost their home due to the price of her Part B drugs. She urges Congress and the Administration to move forward and implement an International Pricing Index. P4ADNow also released a video featuring Mike Gaffney, a resident of Washington state who discussed what the Part B changes would mean for him.
• In April, P4ADNow hosted a congressional briefing featuring a bipartisan panel of experts who agreed that International Reference Pricing can lower drug prices in the U.S. while maintaining innovation.

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