Striking the Balance
Especially for those Americans who rely on regular prescriptions, the high cost of purchasing their vital medicine is an all too familiar burden. Certainly, if something can be done to bring cost down, something should be done. Unfortunately, while bipartisan agreement already exists on policies to do so, House Democratic leadership has thwarted the actual delivery of relief to the American people.
In March of this year, the House Committee on Energy and Commerce unanimously passed a package of bipartisan bills that would ease the burden of medicine costs. Fostering competition in the industry, the legislation would close loopholes that prevent the entry of generic drugs into the market. It would also ensure that the Food and Drug Administration maintains an updated database with lists of expiring patents so that generic drug manufacturers can develop competitive drugs as soon as possible. However, rather than advancing the bipartisan work of the committee and bringing the bills as reported to the House floor, Speaker Nancy Pelosi chose to add poison pill policy riders pertaining to Obamacare that didn’t stand a chance of getting support in the Republican-controlled Senate.
Sadly, instead of solving the high cost of prescriptions in a bipartisan way, House Democrats continue to push nonstarter policies. In fact, the latest is a radical bill that would institute socialist price controls and ultimately bog down research efforts for life-saving medications. Once again, this bill will receive neither the approval of the Senate nor the signature of the president it needs to become law. Politically, the Pelosi plan is another obvious messaging bill to satisfy her radical base. Substantively, it’s a short-sighted approach that likely will not achieve its intended goals while simultaneously precluding companies from uncovering new cures and treatments in the long-term.
Though Americans do struggle with ridiculously high drug costs, it is worth noting that the United States has access to more new cutting-edge drugs than the vast majority of the rest of the developed world, which do use price controls. For instance, Australia had access to only 36 percent of new drugs released between January 2011 and September 2018 – compared to 90 percent in the United States. If similar price controls were implemented, the U.S. would undoubtedly lose the luxury of this access to promising new drugs.
It is often forgotten – or perhaps purposely omitted – that economic policies always have tradeoffs. In a study conducted using data from 1997-2007, the Tufts Center for the Study of Drug Development found that the average cost to produce a new drug was $2.6 billion, as measured in 2013 dollars. Undeniably, it is incredibly expensive to produce new medicines and treatments. Though heavily regulating drugs may lower prices in the short term, it will come at the cost of preventing pharmaceutical companies from being able to invest in research to find new cures and treatments. And that will certainly have long-term effects and monetary costs.
For instance, according to the Alzheimer’s Association, Alzheimer’s disease is expected to cost Americans $1.2 trillion by 2050, measured in 2019 dollars. However, if the environment continues to encourage innovation, companies just might discover and create a miracle drug. Indeed, if the onset of Alzheimer’s could be delayed by five years, it’s been estimated that families would save more than $900 billion over 10 years.
While I agree that something must be done about the often-overwhelming price of life-saving treatments, I cannot support policies – like those recently proposed by House Democrats – that would sacrifice innovation and inhibit discovery of cures. Especially in divided government, lawmakers must craft prescription drug policies that strike the balance between creating savings for the present and promoting innovation for the future.
In the days ahead, I will remain supportive of policies that promote competition among pharmaceutical companies, like those unanimously marked up and passed out of the House Committee on Energy and Commerce earlier this year. And I will remain willing and ready to work with my colleagues to advance bipartisan solutions to bring down the cost burden.