Make Prescription Drugs More Affordable

NCHC Writers
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Today’s drug pricing trends, particularly in the specialty drug sector, seriously threaten the affordability of health care in the United States. For years, patients and purchasers have shouldered prices of more than $100,000 a year for certain medicines – particularly those that treat relatively rare disorders. In a concerning new development, the industry is increasingly applying rare-disease pricing to treatments for diseases afflicting millions: hepatitis, cancer, high cholesterol, multiple sclerosis, and diabetes. If this trend is left unchecked, American health care will soon face an untenable choice: reduce access to medications needed to manage common chronic conditions or face increasingly unaffordable cost burdens.

NCHC supports bipartisan solutions that advance transparency, competition, and value in prescription drugs, including

  • Leveraging Medicare to negotiate prices for a limited number of the highest cost drugs
  • Constraining both high launch prices and untenable increases in prices above inflation
  • Mitigating unintended consequences, such as cost-shifting to commercial markets from Medicare negotiation and premium increases in Employer Group Waiver Plans
  • Reducing anti-competitive behavior by pharmaceutical manufacturers, e.g. patent abuses

Recent publications from NCHC on this topic:

NCHC Statement on the Trump Administration’s “Most-Favored-Nation” Drug Pricing Executive Order

September 14, 2020, NCHC Staff

The National Coalition on Health Care (NCHC) opposes the Administration’s approach to address drug pricing through the “Most-Favored-Nation” (MFN) executive order. The executive order rightly recognizes the urgency of addressing exorbitant drug prices, for the sake of the Medicare program and for its beneficiaries, but we encourage the White House to apply this urgency to comprehensive legislation. Read NCHC’s full statement on the executive order here. 

For a deeper analysis, read NCHC’s memorandum on the order here. 

NCHC Memo on the Trump Administration’s “Most-Favored-Nation” Drug Pricing Executive Order

September 14, 2020, NCHC Staff

On July 24, President Trumped signed a series of executive order (EOs) focused on reducing Medicare beneficiary and program spending on prescription drugs. On Sunday, September 13, the President released a new version of MFN. This MFN also includes linking prices for certain Part D drugs to international prices, in addition to Part B drugs. Both the Part B and D provisions in the latest MFN would operate as a model under CMMI authority. It is unclear whether these would be mandatory or voluntary models. Read NCHC’s full memo on the Executive Order here.

German Model Primer

August 7, 2020, NCHC Staff

As drug prices continue to rise, policymakers debate drug pricing reform. The United States spends more on prescription drugs per capita than any other developed country. For example, Germany spends an average of $685 on retail prescription drugs per capita, while the United States spends over $1,000. Yet, Germany has a similar health care system to the United States. The government has a limited role in the delivery of care and workers usually receive insurance through statutory health insurance paid for by both the worker and the employer. Further, patients are responsible for copayments and deductibles. The German model affirms that drug prices can be lowered in a privatized health care system. Read the full primer here.

Drug Pricing Primer

July 28, 2020, NCHC Staff

High prescription drug prices contribute to high total health care costs in the United States. Prices in the United States are higher than any other developed country, outpacing the effects of volume, types of drugs, or population size on total drug spending. Retail prescription drugs accounted for 9% of the $3.6 trillion (17.7% of GDP) spent on health care in the U.S. Retail prescription drugs, however, will account for a smaller percentage of total spending as specialty pharmaceuticals and gene or cell therapies, especially those administered by a physician or in the hospital, continue to grow in number and price. Specialty drugs and drugs provided in hospital or outpatient settings are among the most expensive for the system and for consumers. A variety of factors lead to high drug prices in the United States, such as monopolistic pricing, the opaque and complex nature of the system, anti-competitive behavior, and lobbying efforts to prevent an independent system of pricing based on a drug’s value. See the Coalition’s full primer here.

NCHC Statement on the Trump Administration’s Executive Orders

July 24, 2020, NCHC Staff

The National Coalition on Health Care (NCHC) strongly opposes the
Administration’s approach to address drug pricing through the executive orders released today. The executive orders rightly recognize the urgency of addressing drug prices, but we encourage the White House to pursue more comprehensive options proposed by the House and Senate.

Read the full statement here.

NCHC Statement on the Pricing of Remdesivir

July 1, 2020, NCHC Staff

On Monday, June 29, Gilead announced the pricing of remdesivir, an anti-viral drug that treats COVID-19. The Coalition supports protecting consumers from unaffordable drug costs. The pricing decision will exacerbate the health care affordability crisis already plaguing the country’s response to COVID-19. Fundamentally, the United States needs to develop a fair drug pricing system that does not rely on the good will of for-profit entities to restrain drug prices, as a matter of containing health care costs and preparing for the next crisis. Read the Coalition’s entire statement here.

National Coalition Expresses Disappointment in 2019 Year-End Package, “Surprise Billing” and Drug Prices Missing

December 20, 2019, NCHC Staff

The National Coalition on Health Care expresses significant disappointment that Congress did not act in 2019 to protect Americans from surprise medical bills or from high prescription drug prices.

Although we applaud the inclusion of CREATES Act in the final year-end spending package, which will help provide a boost to the generic drugs market, the end of the year package lacks any significant changes to drug policy that would protect Americans from the most expensive drugs. Americans have consistently indicated that high and increasing drug prices are the top concern, across both Democrats and Republicans.

The full press memo regarding the 2019 Year-End Package can be found here.

NCHC 2019 State Legislative Summary

August 2, 2019, NCHC Staff

Governors and state legislatures have been taking action in 2019 to lower health care costs and promote affordable coverage options for their residents. We reviewed 2019 state legislation and executive actions, and highlight some of the boldest approaches to lower drug, provider, and health insurance costs. Please click here to read the report in its entirety.

The Hill: Is Arbitration an Answer for High Drug Prices?

April 30, 2019, NCHC Staff

Future prescription drug costs are projected to spike to unsustainable levels. Biologic pharmaceuticals will make up the majority of new drugs, and unfortunately, they are commonly priced at over five figures for a course of treatment. These drugs promise new breakthroughs in treatments for patients with certain targeted conditions, but at prices few can afford.

Medicare in particular needs new tools to better balance the incentives for new drug development with our ability to afford them. Despite recent, negative news coverage many health-care professionals would argue that one of the best solutions is to adopt a tactic that is already in use in other sectors of the economy — binding arbitration.

You can read the published op-ed on The Hill here.

Insulin: The Life Saving Drug that Needs to be Affordable

April 26, 2019, Gabby Battino

Enough is enough–it is time for Congress to address rising insulin prices. Congress has failed to take any action to address the rising cost of insulin. However, the Protecting Access to Biosimilars Act of 2019, introduced by Rep. Diana DeGette (D-CO) in early April, is a promising first step to address the issue. The Energy & Commerce Committee held a series of hearings about the rising cost of insulin. The first hearing, held on April 2th, focused on how patients, providers, and advocates have been impacted by the rising cost of insulin. The second hearing, held on April 10th, investigated PBMs’ and drug manufacturers’ contributions to price increases. As a juvenile diabetic, I sympathized with my fellow juvenile diabetics that testified on April 2nd, and I believe that Congress must make meaningful change to address this issue.

The full blog post can be found here.

Reflections on Binding Arbitration Briefing

April 26, 2019, Gabby Battino

As Congress and the Trump Administration consider policies to address rising prescription drug prices, the National Coalition on Health Care (NCHC) hosted a Capitol Hill briefing on March 15th to put one promising option on the table: the use of binding arbitration in Medicare Part D to determine prices for a limited set of drugs.

The full blog post can be found here.

John Rother’s Orphan Drug Presentation

April 26, 2019, John Rother

On April 10th, NCHC President & CEO John Rother presented at the World Orphan Drug Congress 2019 Conference & Expo to discuss potential policy options to address the rising cost of drugs. Mr. Rother discussed proposals from the FDA, HHS, and Congress. Mr. Rother also identified 4 feasible options to address drug affordability. The slides from the presentation can be found here.

Policy Solutions to Address the Rising Cost of Insulin

April 19, 2019, Gabby Battino

Juvenile diabetes is an autoimmune disorder that affects over 1.25 million Americans.  Also known as Type 1 diabetes, it occurs when the body stops producing the blood-glucose regulating hormone insulin; thus, juvenile diabetics must receive consistent insulin therapy to survive.  Although insulin was discovered in the 1920s, prices for the drug are astronomical by today’s standards.

The full blog post can be read here.

LA Times: Drug Executives Come to Washington as Republicans Grapple with how to Stop Runaway Prices

February 27, 2019, Noam Levy and Jennifer Haberkorn

In a much-anticipated piece of political theater, seven leading pharmaceutical executives appeared before a powerful Senate committee Tuesday for a grilling from lawmakers who pledged a historic bipartisan effort to rein in skyrocketing prescription drug prices.

The original article was published on February 26, 2019 and can be found here.

The Seven Deadly Sins of the Prescription Drug Affordability Market

February 13, 2019, NCHC Staff

The problem of unaffordable prescription drug prices is not a simple on, nor is there a single policy that addresses the full range of issues. We need to fix the current broken system to make drugs more affordable while maintaining incentives to discover important new cures. There are seven “deadly sins” that now characterize the broken market for pharmaceuticals in the U.S. There are practical solutions for each.

The full statement can be found here.

WSJ: Would Drug Price Controls Kill Innovation?

January 15, 2018, John Rother

The U.S. is alone among developed nations in failing to assure more affordable medications for its citizens. Medicare trustees have an obligation to act prudently to obtain fair prices for beneficiaries. Recent research has shown 80% of FDA-approved pharmaceutical patents go to small changes in medications already on the market, rather than to truly innovative new cures. Large pharma companies spend much more on stock buybacks and direct-to-consumer marketing than they do on R&D for truly innovative cures. For example, Pfizer spent $139 billion on buybacks and dividends compared with $82 billion on R&D over the past decade. We need to rebalance the pharmaceutical market to achieve fairer, more affordable prices along with continued incentives for research on the most important health-care needs.

The original letter to the editor was published on January 15, 2018 and can be found here. The article in which the letter responds to can be found here.

Now is the Time to Lower Prescription Drug Prices

January 7, 2018, John Rother

There were two big stories from the pharmaceutical industry this week, both reported by the Wall Street Journal: 1) Bristol-Myers Squibb intends to acquire Celgene in a $74 billion dollar deal; and 2) drug manufacturers have already hiked prices for hundreds of medicines for 2019. Both stories suggest that tough talk from President Trump isn’t working to restrain drug prices.

The full statement can be found here.

Op-Ed: With a New Congress, a Window Opens to Finally Bring Down Drug Prices

November 26, 2018, John Rother

With the new Congress mostly in place, now split between a Democratic House and a Republican Senate, a new dynamic is in place. Any legislation, including efforts to rein in drug prices, will need to have bipartisan support to move forward. Bringing pricing restraint to the costliest prescription drugs should be a bipartisan priority, especially given President Trump’s public pledges to act on drug prices and the negative impact of costly drugs on the federal budget, not to mention on the budgets of families and employers. The change in the House should provide a new political dynamic that offers possibilities for real action on drug prices.

You can read the original op-ed published in STAT News here. 

Letter in  Support of HR 3691, the Addiction Treatment Access Improvement Act 

March 20, 2018, NCHC Staff

Dear Representative Tonko, Representative Lujan, Representative Stefanik, and Representative McKinley:

I write to express the National Coalition on Health Care’s (NCHC) support for HR 3692, the Addiction Treatment Access Improvement Act.

NCHC is a nonpartisan, nonprofit organization representing more than 80 participating organizations, including medical societies, businesses, unions, health care providers, faith-based associations, pension and health funds, insurers, and groups representing consumers, patients, women, minorities, and persons with disabilities. The Coalition is committed to advancing – through research and analysis, education, outreach, and informed advocacy – an affordable, high-value health care system for patients and consumers, payers, employers, and taxpayers.

The full letter can be found here.

Joint Letter Applauding the Every Prescription Conveyed Security Act

February 27, 2018, NCHC Staff

Dear Senators,

We write to thank you for your leadership on the Every Prescription Conveyed Securely Act and urge your colleagues in Congress to support this vital legislation. The opioid crisis is devastating families and communities from coast to coast. In 2016, more than 42,000 people died as a result of the crisis, more than any year on record according to the Centers for Disease Control and Prevention (CDC).

This letter was originally organized and sent by the National Association of Chain Drug Stores to Senators Michael Bennet and Dean Heller. To see the citations and full list of co-signers, please click here.

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