FiercePharmaPolitics—PhRMA attacks Pelosi plan as CBO says it would lower spending; drugmakers raise more prices

Nancy Pelosi
Last week, debate continued on about House speaker Nancy Pelosi's pricing plan. (Gage Skidmore-CC BY-SA 2.0)

Welcome to the FiercePharma political roundup, where each Monday we’ll highlight developments in Washington, D.C., and elsewhere that could affect how drugmakers operate. 

Last week, debate raged on about how House Speaker Nancy Pelosi’s proposal would affect the industry. The Congressional Budget Office reviewed the plan and found it would save Medicare $345 billion between 2023 and 2029, The Hill reports. But the plan would also force companies to offer lower prices to the private sector, so overall savings would likely be larger. 

For pharma companies, the plan would reduce revenues industrywide by $500 billion to $1 trillion over a decade, CBO found. Between 8 and 15 fewer new drugs would reach the market over that 10-year period as well, out of a total group of 300 new launches.

As a reminder, Pelosi’s plan calls for government negotiations on up to 250 drugs per year, financial penalties to get drugmakers to cooperate, measures to roll back certain price hikes and an index pegging U.S. prices to those in other countries, among other ideas. Certain proposals are “non-starters” for Republicans, Cowen & Co. analysts wrote after the plan went public. 

PhRMA CEO Stephen Ubl hit back and told reporters the plan is an “innovation killer," a "job killer" and a "hope killer,” as quoted by S&P Global Market Intelligence. He said it’d wipe out 140,000 jobs in Pelosi's home state of California alone.

Amid the back and forth, Merck CEO Ken Frazier said he knows his industry faces challenges. Speaking at a Yahoo! summit last week, he said pharma is in the “crosshairs,” and that drugmakers face numerous challenges. Among those? A recent consumer sentiment poll that ranked the industry dead last in a group of 25 industries.

RELATED: Merck CEO: When it comes to drug pricing and politics, pharma's in the 'crosshairs'

Elsewhere in biopharma, small biotech Puma Biotechnology caught fire from Democratic presidential candidate Bernie Sanders last week after Stat picked up on two price hikes it’s implemented so far this year on breast cancer med Nerlynx. The company’s shares fell about 6% after the Sanders tweet.  

Rounding out headlines from last week, GoodRx published its third-quarter pricing report, showing drugmakers raised list prices on 125 meds, but across the industry, list prices fell on average by 0.6%. Novartis, Merck and other companies raised prices, the report says. While Eli Lilly’s insulin Humalog went generic earlier this year, uptake for the cheaper copycat remains low, GoodRx reports.