As officials in Washington weigh contentious drug-pricing measures, there's even more evidence that pharma companies are worried about potential reform.
In an open letter to Congress, the heads of major biopharma companies including Eli Lilly, AbbVie, Bristol Myers Squibb, Biogen, GlaxoSmithKline and many more wrote that one proposal in particular—allowing Medicare to negotiate drug prices—would "threaten patients' access to medicines and sacrifice future medical advances."
Earlier this month, the Biden administration's HHS unveiled a plan to tackle high drug prices, including by allowing the government's healthcare system to negotiate with pharma companies. Drugmakers have long resisted the measure, arguing it would hurt R&D incentives. This time, they pointed to the industry's COVID-19 response as evidence that Washington should continue to prioritize innovation.
Analysts think it's unlikely Medicare negotiations are unlikely to pan out, but the drug industry seems to be taking the threat seriously.
In their letter, the pharma execs warned that the one proposal under consideration would cut $1.5 trillion from "innovative research companies" over a decade. That'd mean a 90% reduction or more in new medicines developed by biotech companies.
Aside from Medicare negotiations, officials are considering punishments for companies who raise prices above inflation plus relaxing drug importation rules and more.
"We agree with leaders in Washington that Americans need help with their healthcare costs, but these dangerous policy experiments are not the answer."
The letter follows a press briefing last week with Merck, Eli Lilly and Takeda executives, who outlined similar reasons why the government shouldn't proceed with Medicare pricing negotiations.
While pharma representatives clearly want to avoid tough reforms, others are calling for the government to finally act on the issue.
In their own open letter to lawmakers this summer, groups comprising Families USA, Lower Drug Prices Now, Patients for Affordable Drugs and more wrote that Congress has a "unique and time-limited window for crafting meaningful drug pricing reform this year." They called on the government to implement drug pricing negotiations, install price-hike limits and redesign Medicare Part D to slash costs for beneficiaries and taxpayers.
Drug pricing advocates have been calling for reform for years, but despite the numerous proposals floated for consideration, no major pharma pricing reform efforts have taken shape in recent years.