Former HHS Secretary: Proposed Drug Pricing Bill Would Suppress Innovation
Washington, D.C. (April 22, 2021)—Today, House Democrats reintroduced legislation that would apply price controls on prescription drugs acquired through Medicare Part D. While pegging the domestic cost of medicine to the price paid by some foreign countries could help lower drug prices in the short term, the policy will have major adverse unintended consequences. Artificially lowering product prices via government edict will shrink research and development budgets at pharmaceutical companies, which will translate into fewer lifesaving treatments and therapies being available for patients.
Instead of compromising the future of U.S. healthcare, policymakers should target Pharmacy Benefit Managers, known as the middlemen of the drug supply chain, that siphon billions of dollars annually in profit at the expense of consumers at the pharmacy counter. Towards the end of 2020, President Trump proposed an executive order that would have forced middlemen to pass along some of that money to consumers, but the rule’s implementation date has been postponed by the Biden administration.
Dr. Tom Price, former HHS Secretary and senior healthcare policy fellow at the Job Creators Network, released the following statement:
Lowering prescription drug prices in the U.S. should be a priority for lawmakers, but it should be done without compromising the development of new life saving medication. Instead of wielding the government as a tool to artificially fix prices based on other countries, policymakers should target the middlemen right here at home that game the system to profit on the backs of patients. Encouraging Pharmacy Benefit Managers to pass along at least some of the discounts they already receive from drug manufacturers could save patients billions of dollars a year at the pharmacy counter.