Prior to the president's final State of the Union address, Democrats announced new plans to investigate drug prices in 2016.
In the last few months of 2015, Congressional committees have been taking a special interest in the rising price of drugs and subpoenaing companies to provide some insight into how they chose certain prices.
Prior to the president’s final State of the Union address last night, Democrats announced new plans to investigate drug prices in 2016 following a letter sent to National Institutes of Health (NIH), pushing the agency to respond the rising prices.
In a press call, House Democratic Caucus Chairman Xavier Becerra highlighted the recent controversy of Daraprim, for which Turing Pharmaceuticals raised the price overnight by 5000%.
“That’s unconscionable,” he said. “It’s unreasonable and it’s inexplicable. And we believe that there’s a need for more oversight, more clarity, and more transparency in how this is done.”
Congressman Lloyd Doggett added that the problem is not just about 1 drug or 1 company or even 1 category of drugs. However, while lawmakers want to “remain considerate of innovation,” they also want to ensure consumers can access the pharmaceutical products that might be life-saving or pain-relieving.
He explained that a task force will be designed to explore the many facets of the issue, to educate people on the problem, and to have forums so experts on the topic and victims of price gouging will have their voices heard. They have so far learned that not only are Americans being diagnosed with a serious disease or medical condition, but they are also receiving the prognosis of bankruptcy or financial ruin because treatment can cost thousands of dollars a year, which people cannot afford.
“We have sent out the first of what will be a number of inquiries and requests to the administration to look at existing law and use it to the fullest, knowing that there is not any 1 regulatory rulemaking process that can resolve this, but that there are some actions that can be taken within our limited existing law to try to provide some restraint, some break on prices that are soaring for pharmaceuticals,” he said.
Congressman Peter Welch closed out the call by pointing out that the pharmaceutical industry is not wrong that these new medications have been tremendous with the ability to extend life and relieve pain. Unfortunately, they are simultaneously killing the taxpayer and the consumer with the cost and killing the employer who wants to do right by his or her employees,
Part of the problem is that there is currently an ongoing debate about why the costs for treatments are being set at such high prices. More transparency is needed, he said, because while pharmaceutical companies claim how expensive it is to do the research, they also use research from NIH, which is funded through billions from taxpayers, and the Research and Development Tax Credit is also paid for by taxpayers.
“So is the cost of producing a new drug over $2 billion as the pharmaceutical companies say, or is it much closer to $600 million or $800 million when you factor in the taxpayer contributions to the whole effort?” he asked.
Welch outlined 4 potential ways Congress and the federal government can address the high price of drugs that is not the result of a functioning market, but is instead the result of “market failure and market distortion.”
“We have recognized that this is not something that should wait for the inauguration of a new president, but rather have looked for every way within existing law to try to address the dimensions of the problem and make competition work here where it as so often not worked to bring about reasonable prices,” said Doggett.