Why One Expert Thinks the Medicare Drug Price Negotiation Program Is Here to Stay

Why One Expert Thinks the Medicare Drug Price Negotiation Program Is Here to Stay

From left to right: Marissa Plescia, reporter at MedCity News; and Merith Basey, executive director of Patients For Affordable Drugs

After much anticipation and a bevy of (ongoing) lawsuits, the U.S. government is finally beginning to negotiate drug prices with pharmaceutical companies — the White House announced last week that all 10 drugmakers whose drugs were selected for the first cycle  of the Medicare drug price negotiation program have “decided to participate.”

This news has been a long time coming, given all other high income nations have been able to negotiate drug prices with pharmaceutical companies for years, said Merith Basey, executive director of advocacy organization Patients For Affordable Drugs, during a Sunday session at Engage at HLTH in Las Vegas. She celebrated the Medicare drug price negotiation program as a major win for the drug affordability movement and said she hopes this momentum can help advance her organization’s work even further.

When the White House announced that it was going to start allowing drug price negotiations, it was seen as a rare legislative loss for the pharmaceutical industry. Drugmakers swiftly took issue with the program, saying that it would lead to significant profit losses and therefore hinder innovation. There are currently at least nine lawsuits filed (mainly by drugmakers) against the government trying to block these negotiations, but experts think these won’t be successful in stopping the program.

Basey believes the price negotiation program is here to stay, no matter who is president and no matter how many Big Pharma players file lawsuits. Her reasoning is simple — the program is incredibly popular among pretty much everyone who isn’t a drugmaker.

“I don’t have a crystal ball, but we know that American people are largely on the opposite side of the pharmaceutical companies. Favorability for pharmaceutical corporations is at an all time low point currently — it’s about 18%. Recent polls have also shown that it doesn’t matter on which side of the aisle you sit. Over 80% of people in this country believe that Medicare should negotiate,” Basey explained.

After all, the American people are the ones who pay for drugs to be developed a lot of the time, she pointed out. 

A common argument drugmakers use in their attempts to defy the price negotiation program is that it’s very expensive to bring a drug to market and they feel they should be rewarded for that. But Basey highlighted the fact that the National Institutes of Health is the largest funder of global health research in the world. 

“NIH funding is all public money. It’s $45 billion annually that goes into new research, often the riskiest research that pharmaceutical corporations aren’t willing to take on until it looks like in Phase I or Phase II trials that may be something to make a profit from. We know that it is expensive to make a drug, but most of that initial research is funded by the taxpayer. The taxpayers and patients need to be the ones who benefit rather than the profits of corporate CEOs,” Basey declared.

She also cited a recent study that showed the NIH contributed funding to all but two of the 356 drugs the FDA approved from 2010 to 2019.

In addition to its strong support of the White House’s drug price negotiation plan, Patients For Affordable Drugs is also backing bipartisan bills in Congress that support more competition within the pharmaceutical industry, Basey said. Drugmakers have a range of tactics they use to stifle competition, she noted. One of these tactics is pay-for-delay, in which a pharmaceutical company will pay a generic competitor to delay its entry into the market. Patent thickets are another common tactic — this occurs when a drugmaker continually adds multiple patents to a single drug so that it becomes very difficult for competitors to enter.

The drug affordability movement has seen some key wins in the past year — the start of Medicare drug price negotiations as well as the three biggest insulin manufacturers lowering their prices. With these wins under their belt, the only way for the movement to go is forward, Basey stated.

“Know that the system is currently integrated in favor of the corporations, not the patients. That is the starting point,” she declared.

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