PhRMA Proposals Fail to Lower Rx Prices and Instead Benefit Drug Companies and Shift Costs — While Ad Campaign Seeks to Divert Attention from Egregious Practices
This week, the principal trade group for Big Pharma, the Pharmaceutical Research and Manufacturers of America (PhRMA), launched a new seven-figure ad campaign seeking to bolster the industry’s image with policymakers. The ad campaign was released in concert with a policy platform which PhRMA touted as demonstrating a new openness to measures to lower prescription drug prices — even those that would hurt drug companies bottom line.
Penalty flag. While portraying themselves as willing to take a hit for the greater good in this rollout, Big Pharma took zero responsibility for the industry’s egregious pricing practices that have created a crisis of affordability (including continuing to hike prices during the pandemic) and laid out policies that would principally benefit brand name drug companies and fail to lower prices by shifting costs and directing blame at others in the supply chain.
One of the proposals included in PhRMA’s recommendations is a misguided policy known as the Rebate Rule, that would hand drug companies a more than $100 billion bailout while increasing premiums on Medicare Part D beneficiaries and eliminating the only step in the current system that acts as a downward force on prices. Read more about the Big Pharma-backed Rebate Rule HERE.
Other proposals amid PhRMA’s disingenuous policy menagerie would also eliminate pressure to keep drug prices reasonable by capping out-of-pocket costs for Part D beneficiaries without simultaneously holding drug companies accountable for price hikes. American seniors need relief and out-of-pocket costs should be capped, but that must be combined with market-based solutions that disincentivize or prevent Big Pharma from hiking prices at egregious rates with taxpayers picking up the tab. Learn more about the importance of holding Big Pharma accountable in a redesign of the Part D program HERE.
The one policy area where PhRMA showed an apparent epiphany about the industry’s egregious behavior was in regard to “product hopping.” This anti-competitive tactic is a favorite of Big Pharma companies seeking to extend monopoly power over products in their portfolio by changing formulations near the end of patent exclusivity. Lawmakers should crack down on this egregious practice, but it is just one of many ways Big Pharma games the system to increase prices and undermine more affordable options. Read more about Big Pharma’s track record of patent abuse HERE.
And while PhRMA’s ads will tout the role of the industry in combatting the pandemic, what those ads won’t mention, is that Big Pharma has continued to hike prices while receiving billions from taxpayers as Americans faced unprecedented economic and health care uncertainty. Brand name drug companies have hiked prices on more than 830 prescription drugs so far this year, on top of more than 65 price hikes last summer. Read more on Big Pharma’s pandemic price hikes HERE.
Policymakers must see through Big Pharma’s disingenuous rhetoric and advance bipartisan, market-based solutions to truly lower prescription drug prices and hold drug companies accountable for their egregious practices.
Learn more about market-based solutions to hold Big Pharma accountable and lower prescription drug prices HERE.