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Momentum Builds For Govt. Price Controls On Drugs


D BY BILL HOFFMANN


emocrats, newly in charge of the House of Representatives, may have something in common with


President Donald Trump — and it’s causing agita for Big Pharma execu- tives and for conservatives. Both Trump and the Democrats


have accused pharmaceutical giants of burdening consumers with increas- es in drug prices that are “unfair.” And this is leading to talk of a


proposal that would have been almost unthinkable until now: government price controls on drugs. Last year’s midterm elections


made clear that healthcare is the No. 1 issue on voters’ minds. Democrats successfully bludgeoned Republicans over their inability to fix the out-of- control costs inherited from President Barack Obama’s healthcare reforms. Last summer, after Pfizer announced a round of price hikes, the president tweeted that the drug indus- try “should be ashamed that they have raised drug prices for no reason,” add- ing, “they are merely taking advan- tage of the poor and others unable to defend themselves.” But just two weeks after the elec-


tions, Pfizer announced it would hike prices on 41 different prescription medications — about 10 percent of its total portfolio. The merits of price controls gath-


ered new steam as Trump, during a raucous pre-midterm rally, vowed to supporters that “very soon, drug pric- es will go plunging downward.” The commander in chief added the middle class is “effectively funding virtually


12 NEWSMAX | JANUARY 2019


all drug research and development for the entire planet.” As improbable as it may seem polit-


ically, Trump’s views are not too far removed from legislation introduced in November by Vermont Indepen- dent Sen. Bernie Sanders and Rep. Ro Khanna, D-Calif. Their bill would push drug compa-


nies to price prescription medications in line with what they cost in countries, such as Canada, the United Kingdom, and India, which is generally substan- tially less. A 2015 Reuters


study found that the prices of the top 20 drugs in the U.S. are three times what the same drugs are sold for in the U.K. A prescription


for the common immunosuppres- sive drug Humira, for example, costs about $1,300 in the U.K., $800 in Swit- zerland, and $2,700 in the U.S., accord- ing to Vox.com. Given that dis-


guide. But whether GOP senators will back international-reference pricing is another question. “I just don’t see a swell of support


for this,” Douglas Holtz-Eakin, presi- dent of the conservative American Action Forum and the former chief of the Congressional Budget Office, tells Politico. “This is tantamount to bringing to the U.S. price con- trols . . . and conservatives aren’t fond of it.” The Centers for Medicare and Medicaid Services has projected drug prices will rise 6.3 percent per year for at least the next decade, outpac- ing even the spiraling cost of health- care generally. Wayne Winegarden, a senior


RX PRICE: A WORLD OF DIFFERENCE What patients pay per


prescription for the common immunosuppressive drug Humira in Europe vs. the U.S.


$2,700


fellow in Business and Economics at the Pacific Research Institute, wrote in Forbes that Trump’s idea “would harm the quality of health- care in the U.S. by reducing patients’ access to medi- cines and harm- ing future innova- tions.” And Citizens


$1,300 $800 U.K. SWITZERLAND U.S. SOURCE: Vox.com


Against Govern- ment Waste, a non-partisan, non- profit think tank, agrees: “Competi- tion and market forces, not price controls, will drive down drug costs and will do so bet- ter than any heavy-


parity, it’s understandable why the president would feel pharmaceutical companies are using their unbridled revenues in the U.S. to fund their research and development that will benefit the entire world. Trump wants to change how Medi-


care Part B pays for prescription drugs by also using international prices as a


handed legislation or regulation. U.S. price controls on drugs would


cut the number of new research and development projects by 30 percent to 60 percent, reports the Manhattan Institute’s City Journal. That would mean “fewer new drugs to ward off disability and death, slowing the increase in longevity.”


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