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Seven Pharmaceutical Executives Testify at Drug Pricing Hearing

March 1, 2019

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PRESS CONTACTS
Jason Kleinman, Senior Legislative Analyst, Govt. Relations

The Senate Finance Committee held a Feb. 26 hearing on prescription drug prices that featured executives from seven pharmaceutical companies. This was part of a series of bipartisan hearings the committee is hosting on the same topic [see Washington Highlights, Feb. 1].

Chairman Chuck Grassley (R-Iowa) and Ranking Member Ron Wyden (D-Ore.) both used their opening statements to highlight the need to reduce high list prices. Sen. Grassley noted, “One of the first things we need to talk about is list price … For a patient taking a drug that has no competition, the list price is meaningful. For seniors on Part D who are paying co-insurance as a percentage of list price, the list price is meaningful. For people who have high deductible plans and pay thousands of dollars towards list price, the list price is meaningful. For pharmacy benefit managers, providing drugs with a high list price can be more attractive than providing a less expensive drug. Therefore, for taxpayers, the list price is meaningful.”

In his remarks, Sen. Wyden highlighted examples of how each of the seven pharmaceutical companies have recently raised prices on prescription drugs. He also questioned their use of coupons and other assistance programs to help patients afford their drugs. He added, “But if these programs are so widely generous, why can’t drug makers instead simply lower prices across the board?” At the end of the hearing, Wyden gave each witness ten days to determine whether or not they would support a law requiring companies to reduce list prices by the amount of the rebates.

During the hearing, the pharmaceutical executives expressed their interest in working with Congress to lower drug prices but noted that other parts of the health care system lead to high consumer prices, including the rebates negotiated by pharmacy benefit managers. Many of the witnesses expressed their support for a recent proposal from the Department of Health and Human Services to pass drug discounts directly on to patients at the point of sale [see Washington Highlights, Feb. 1]. Several also voiced support for Sen. Grassley’s Creating and Restoring Equal Access to Equivalent Samples (CREATES Act, S. 340), which would deter pharmaceutical companies from blocking generic alternatives from entering the marketplace.

To conclude the hearing, Sen. Grassley noted that was the start of the dialogue and the committee will continue to engage in this topic and work to correct some of the issues raised by the witnesses.

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