By John Rother
The National Association of Medicaid Directors (NAMD) recently issued a letter to Congress that included a variety of interesting proposals but also raised the specter of direct or indirect price controls for the very high-priced Hepatitis drugs that are devastating state Medicaid budgets. While NAMD explicitly did not endorse any single proposal, its appeal to Congress highlights the frustration felt by many stakeholders.
Our coalition has repeatedly warned that the debate is likely to move toward some form of price control unless Gilead and its brethren start to act more responsibly and sincerely engage with health care stakeholders. Thus far Gilead’s response has been the opposite – it has dug in its heels and been quite clear that its most important stakeholder is Wall Street. We have repeatedly stated that we do not support price controls because we believe there are better options to address extremely high prices. Perhaps the most important change we need to institute is a more robust and data-driven discussion about the value proposition of new high-priced medicines BEFORE they are introduced. Medicines can absolutely deliver important value to patients and to the health care system. Unfortunately, there is often little dialogue about value proposition prior to pricing, particularly for medicines that face little competition.
NAMD points that the mere presence of other drugs on the market doesn’t always offer the hope of reasonable pricing:: “Though there is potential for more state negotiating power as new drugs enter the market, we cannot speculate on how effective these negotiations will be in light of the possibility that these drugs will be priced similarly to Sovaldi.”
State Medicaid Directors are quite literally on the front lines of health care, serving the most vulnerable among us. Their only motive is to sustainably deliver health care to those in need. While our coalition’s policy prescriptions may differ from those of State Medicaid directors, we commend the directors for their leadership in continuing to put a spotlight on the challenges to our health care system posed by the unsustainable pricing of certain medicines.
The debate need not go in the direction of price controls. There are opportunities for stakeholders to come together and find innovative solutions, and our coalition stands ready to work with pharmaceutical companies and other stakeholders to find approaches that protect the innovation we all want now and into the future.