Calling Big Pharma’s bluff and making prescription drugs more affordable

Bringing down the cost of prescription drugs ought to be ripe for bipartisan cooperation. Members of both parties talk about how drug prices are too high. And seniors don’t see this as a partisan issue—they see it as a dire budget issue, and sometimes even a life-or-death issue.

Yet during the previous administration, despite a lot of lip service from President Donald Trump and some of his allies in Congress, nothing got done. In the first half of 2019 alone, the price of 3,400 drugs increased. And despite bipartisan efforts by the Senate Finance Committee, Majority Leader Mitch McConnell (R-Ky.) refused to bring the committee-passed legislation to lower the cost of prescription drugs to the Senate floor for consideration and a vote—yet again choosing to stand on the side of big pharmaceutical corporations over American families.

With President Joe Biden in the White House and a Democratic majority in Congress, one of the first steps we need to take to bring down drug prices for seniors is to allow Medicare to negotiate directly with drug companies for lower prices.

It’s something I’ve fought for my entire career.

We know that right now, the Secretary of the Department of Health and Human Services is banned from negotiating to get better prices for seniors, the way the Veterans Affairs Department and private companies do. That means that one of the world’s largest purchasers of prescription drugs, the U.S. government, is prohibited from using a standard business practice available to others—leveraging volume to lower cost. This prohibition serves one purpose: protecting drug companies’ profits at the direct expense of patients and taxpayers. 

Big Pharma benefits from huge taxpayer investment, and then turns around and charges those same taxpayers exorbitant prices under government-protected monopolies—all while reaping some of the highest profits of any industry and paying out massive CEO bonuses.

This is why in 2019 I joined my colleague Rep. Lloyd Doggett (D-Texas) in the House to introduce legislation that would give Medicare the power to negotiate directly with these corporations, and demand bigger discounts to lower costs.

Our plan would use compulsory licensing to force market competition. If drug companies refuse to negotiate in good faith, the HHS secretary could force competition into the market by issuing a license for the drug to another company that could produce the drug as a generic. 

Because our plan uses the threat of market competition to bring prices down, people on Medicare would still enjoy the same broad range of drug options. 

We know Big Pharma’s complaint—it’s the same tired argument they’ve made for years, that competition would limit research into new drugs. But this has been debunked. Plus, American taxpayers already help these companies fund their research through the National Institutes of Health and other government investment. 

Research into new drugs and treatments is vital. But these advancements won’t have much value if patients are unable to afford them or go bankrupt paying for them. 

Many of these corporations spend more on advertising than they do on research and development. If they’re forced to charge reasonable prices, there shouldn’t be a need to cut into R&D budgets; they could reduce their marketing or advertising budgets instead, or make executive pay less exorbitant and spend less on stock buybacks. 

There’s no reason drug companies can’t negotiate a fair price for seniors, the same way they negotiate with the VA and with health insurance companies.

Our efforts also must not be limited to Medicare alone because we know seniors aren’t the only ones with budgets stretched to the breaking point by the high cost of medicine. And we must address the entire supply chain—from holding companies that increase the price of their drugs year after year responsible for price gouging, to requiring greater transparency for pharmacy benefit managers.