With U.S. Senator Chuck Grassley
Q: What can be done to bring down prescription drug prices for American consumers?
A: Drug pricing is tied to a complex, highly regulated regime laced with incentives and guidelines structured to protect patient safety and foster innovation. Congress has enacted patent laws intended to encourage advances in biomedical technology to improve public health and save lives. In recent decades, the American public has placed high hopes on breakthrough medicines to prevent, treat and cure chronic illnesses and diseases. At the same time, Americans are increasingly alarmed by the escalating costs of prescription medicines. Iowans routinely express concern about access to affordable medicine and the sticker shock that too often occurs when they fill a prescription. In fact, Iowans flagged an issue during the Obama administration about sky-high increases they were paying for the anti-allergy EpiPen device. It turns out a drug manufacturer was exploiting the Medicaid Drug Rebate program by classifying its popular anti-allergy medicine as a generic instead of as a brand name product. That move allowed it to issue smaller rebates to government programs, such as Medicaid. My oversight work led to troubling revelations that taxpayers were on the hook for exorbitant overpayments for the better part of a decade starting in 2006 because of that misclassification. The costly, anti-competitive practices were confirmed by the government’s internal watchdog when it found that taxpayers may have overpaid for the EpiPen by as much as $1.27 billion over 10 years. Pharmaceutical companies gaming the system are cheating taxpayers and consumers by untold billions of dollars. The federal government needs to do a better job policing and enforcing the law and overseeing its programs. In places where the law falls short, I’m working on legislative reforms that would plug loopholes and hold wrongdoers accountable for taking taxpayers for a ride.
Q: What other solutions are you working on to lower drug prices?
A: The crux of the matter is figuring out how to thread the needle that stiches together the regulatory, legal and scientific patchwork that delivers lifesaving treatments and cures to the American people without compromising patient safety or curbing breakthrough scientific innovation that often require many years of expensive research and development. As chairman of the Senate Judiciary Committee, I am leading efforts on Capitol Hill to advance bipartisan bills that would improve market-based competition and curb Big Pharma’s appetite for gaming the system with the cooperation of generic drug makers. That includes examining market exclusivity and legal arrangements that block generic competition from bringing more affordable options to neighborhood pharmacies. Delaying tactics too often make it virtually impossible for generic competitors to fairly compete for market share, including abusive practices that clog the pipeline to obtain samples of a particular medicine. Generics need access to branded samples to perform testing that proves their product is equivalent to the brand name drug. Another delaying strategy brand name drug makers use to undercut generic competitors is to block them from participating in safety protocols required to secure the FDA seal of approval. Our bipartisan CREATES Act would deter brand drug manufacturers from putting up anti-competitive roadblocks to generic drug competition. The Congressional Budget Office estimates our bill would shave $3.8 billion from the deficit and likely billions more for consumers and their insurers. I’ve also introduced a bipartisan bill that would crack down on anti-competitive pay-off schemes called the Preserve Access to Affordable Generics Act. Our legislation would lower the hammer on so-called “reverse payments” in which brand name manufacturers pay generic competitors not to compete as part of a patent settlement. As a result, consumers get the short end of the stick because generic drugs can be as much as 90 percent cheaper than brand name drugs. Soaring drug prices are unsustainable to household budgets and the public purse. Whereas no one wants to put an end to America’s soaring success stories in scientific discovery and breakthrough cures, our federal regulatory regime needs to nimbly address flaws in the system that harm market competition at the expense of consumers and taxpayers. The web of anti-competitive maneuvers that thwarts competition in many cases gets mired in years of costly litigation. I’m working to cut through the thicket of federal regulations that are being exploited to undermine competition without uprooting medical discovery and innovation that drives economic growth and saves lives. I’m glad the Trump administration recently announced plans to follow through on the president’s agenda to lower drug prices for American consumers. I will continue my work to strengthen transparency and competition, including rigorous enforcement of anti-kickback laws. They are time-tested tickets to prevent consumers and the taxpaying public from being taken for a ride.