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“I highly doubt trade policy reform would make any
meaningful difference,” she said. “The U.S. pays the
highest prices because the market will bear it—until
we figure out how to curb that greed, it will continue.”
The report condemned “free-riding” foreign countries
that force U.S. drug manufacturers to comply with pricing
rules to gain market access. This allows them to undercut
U.S. drug prices and erode manufacturers’ returns.
It also rejected imposing government price-setting on
drug manufacturers, a tactic backed by Democrats, arguing
that “if the United States had adopted the centralized
drug pricing policy in other developed nations 20 years
ago, then the world may not have highly valuable treatments
for diseases that required significant investment.”
But getting other countries to pay “their share” of pharmaceutical
costs is extremely unrealistic, Fox said.
The FDA approved more than 1,000 generic drugs last year, the
highest mark in the history of the agency’s drug approval program.
The FDA has increased competition by expediting reviews
of abbreviated new drug applications where there are limited
approved generics, publishing an off-patent list of branded
drugs without an approved generic and new guidance to improve
communication between manufacturers and the agency.
The White House advisers recommended extending this
strategy to products that are second or third in a class
that have no generics. This could lower prices by providing
quicker entry into monopoly markets, they said.
Rising drug prices have been a focal point of lawmakers,
consumers and others involved in delivering healthcare who
lament the current systems that lacks competition and free
market control. Numerous headlines about drastic price increases
and pharma companies’ system-gaming techniques
to elude competition fueled bipartisan outrage and 100-plus
drug-price related bills. While many ideas have been proposed
to lower drug prices, solutions thus far haven’t stuck.
The Creates Act and FAST Generics Act are two examples targeting
drug prices by trying to close patent loopholes and potentially
saving billions of dollars a year in reduced drug costs.
Per-person spending on prescription drugs covered in
employee-sponsored health plans rose 1.5% in 2017,
less than half the increase in 2016 and the lowest in 24
years that pharmacy benefit manager Express Scripts
has tracked the data, the organization reported Feb. 6.
Generic fill rates increased from 85.1% in 2016 to 86.2% and increased
generic competition helped slow drug prices’ steep ascent,
while spending on specialty drugs was up 11.3%, the lowest
increase Express Scripts has reported. Still, pharmaceutical
products cost more in the U.S. than any developed country.
Health and Human Services Secretary Alex Azar
said Friday he would push ahead with drug pricing
reforms despite pushback from the pharmaceutical
industry.Azar was defending the administration’s
latest, and most aggressive action yet, to target escalating
drug prices in the U.S.
A proposal announced Thursday by President
Trump and Azar would base payments for some drugs
off of lower prices in other countries.
In a white paper, the council
proposed increasing
competition for pharmacy
benefit managers, restricting
drug-reimbursement
under the 340B drug
discount program and
moving Medicare Part B
drug coverage into Medicare
Part D, among other
recommendations.
But these “me too” drugs are likely to enter at similar prices
as their competitors, and the strategy fails to address issues
surrounding pharmaceutical companies gaming the
system through citizen petitions, getting additional exclusivity
periods and evergreen their patents, Fox said.
The council also advocated for increasing competition
among biosimilars, which are more complex and expensive
to make, by speeding up the issuance of final guidelines
on demonstrating biosimilar interchangeability. Experts
have widely touted the benefits of increasing the
speed of interchangeable biosimilars to decrease costs.
Still,to the prior impotant policy recommendations
have been thwarted. The Obama administration had
proposed its own drug policy reforms that were ultimately
quashed by pharma companies and providers.
“The Obama administration had an opportunity with the
ACA and control over the House and Senate and there wasn’t
really anything about drug price controls in there,” said
John Kelliher, managing director of the Berkeley Research
Group. “The problem with drug prices is that it is easy to
complain about but the policy tools to fix it are pretty limited,
and even more limited if you’re not doing some price
control-regime. It leaves you tinkering around the edges.”
Looking ahead, health systems can expect drug prices to increase
by 7.35% from July 1, 2018 through June 30, 2019, driven
by the surging prices of branded, specialty medications,
particularly disease-modifying anti-rheumatic drugs, agents
for multiple sclerosis, oral oncology agents, and multiple
treatments for hepatitis C, according to a recent forecast by
the group purchasing and consulting organization Vizient.
That projection was slightly down from last year’s estimate of
7.61% as some specialty drugs like hepatitis C treatments are
expected to level off and fewer drug price hikes are expected
given the rising public scrutiny.
Health and Human Services Secretary Alex Azar said Friday
he would push ahead with drug pricing reforms despite pushback
from the pharmaceutical industry.
“Finally seeing this system reformed, in fact, is one of the pharmaceutical
industry’s ultimate nightmares,” said Azar, a former
Eli Lily executive, at a Brookings Institution event in Washington.
“I can tell you that because it used to be my job to have
pharmaceutical nightmares.”
“But now we have a president who is definitely not afraid of upsetting
drug companies and isn’t afraid of taking on ostensibly
invincible special interests,” he added.
Azar was defending the administration’s latest, and most ag-
These relatively modest proposals will not
satisfy Democrats who remain fixated on
adopting a single payer system where the
Federal government can set prices, as is
the case in western Europe
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