Washington, D.C. (December 6, 2021)—As the U.S. Senate considers the ‘Build Back Better’ budget reconciliation package that was passed by the House of Representatives in November, medical professionals are calling-out dangerous drug pricing provisions that are included in the legislation. Although initial elements of the package have been watered down, existing measures to apply price controls to some medicine threaten future healthcare innovation.
According to a new study from the University of Chicago, the drug pricing components included in the ‘Build Back Better’ bill will lead to 135 fewer new drugs over the next 17 years. That translates to a loss of 331.5 million life years in the U.S.—more than 30-times the impact of COVID-19 to date.
Key components include empowering the federal government to buy some medicine at a fraction of the market price by threatening drug companies with an excise tax if they don’t comply, as well as pegging “allowable” price increases of other pharmaceuticals to inflation.
Physician members of the Job Creators Network (JCN) are sounding the alarm bell about the proposal.
Today, Dr. Katarina Lindley, a Yugoslavian immigrant who experienced the consequences of government intervention in healthcare firsthand, penned an op-ed in RealClear Health to warn of the pitfalls. Dr. Lindley noted:
“More government is rarely the answer to economic challenges. The price of healthcare is no exception. Congress and the Biden administration should reconsider applying price controls on prescription drugs. It will create more problems than it solves…What happens when drug manufacturers are unable to profit, or even break even, on newly developed products? The free market incentive to innovate and create is weakened and patients would ultimately pay the price. Fewer new therapies, treatments, and vaccines would become available to consumers as the rate of healthcare innovation slows.”
Dr. Mary Tipton, an internal medicine and pediatric specialist in Utah, commented:
“The rising cost of pharmaceuticals is a problem that warrants action. But the proposed strategy will have major unintended consequences…As moderate and progressive elements of the Democratic caucus in Congress continue to go head-to-head over the budget reconciliation package, price controls on prescription drugs should be a nonstarter. Instead, lawmakers should shift their sights to the intermediaries of the drug supply chain that jack-up costs for patients. Slowing the pipeline of health care innovation and reducing access to new prescription drugs is the last thing Americans need as we emerge from the pandemic.”
Dr. Robert Campbell, a practicing physician in Pennsylvania and past president of the Pennsylvania Society of Anesthesiologists, said:
“Prescription drug costs in the U.S. have skyrocketed in recent years…But lawmakers should be careful to avoid a knee-jerk reaction that will have major negative repercussions down the road…In the short run, the cost control scheme would benefit American patients in the form of lower drug prices. But those advantages would quickly be negated in the long run as shrinking research and development budgets—a result of falling revenue for drug companies—translate to less innovation and fewer medicines brought to market.”