Unfortunately, on this first hearing regarding payment for drugs subject to accelerated approval and related issues, I have significant policy differences with you regarding how to assure access to innovative new drugs without paying monopoly prices.
Twenty years ago, the Medicare Prescription Drug program was narrowly forced through the House after hours of arm twisting in a near all night session. With one notable line in a lengthy bill, Big Pharma ensured it would retain monopoly power and the ability to charge the very highest prices through a complete prohibition against any Medicare negotiation of drug prices.
Finally, last year, Democrats provided a narrow carveout to eventually allow negotiation on a very small number of drugs, that offers no hope of lower prices to most Americans. So extremely narrow and restrictive was this carveout that financial services firm Raymond James said “pharma’s CEOs are likely popping champagne and smoking cigars.” Yet unwilling to yield even this smallest sliver of monopoly power, Big Pharma promotes scare tactics that insist we cannot have both reasonable prices and essential innovation.
We all want to encourage cures and treatments for dreaded diseases long before we or a loved one face a troubling diagnosis. Despite its overly generous tax incentives, its taxpayer-funded research, its monopoly profits, Big Pharma, I believe, has actually been doing far too little to secure those new medications.
Seldom worried about a competitor with a better idea, monopolies and oligopolies are not known in any industry for their innovative spirit. Over a decade (2005-15), 78% of new drug patents were not for the new cures we need, but were small modifications to existing drugs designed to extend monopoly power and monopoly prices. Among the 10 top-selling drugs in the country, 66% of patent applications were filed after FDA approval and an average of 74 patents were granted on each drug.
And while there are pathways intended to get innovative drugs and devices to market quickly, the FDA’s Accelerated Approval program and Medical Device breakthrough program are deeply flawed. About 40 percent of all drugs granted accelerated approval have failed to complete confirmatory clinical trials after coming to market, as required. Those trials are critical to ensuring drugs have a clinical benefit and meet all safety requirements.
Similarly, in its first 3 years, the FDA granted a remarkable 222 devices breakthrough designations, despite poorly designed studies that did not demonstrate real clinical benefit on many of those devices and some safety studies showing substantial risk to patients. I have long been concerned with medical device safety and it is apparent that the FDA has increasingly become a captive of those that it is charged with regulating. It has not been forceful enough or creative enough, early enough, to protect patients. At a bare minimum, physicians ought to be required to report device safety issues and the FDA ought to provide unique device identification numbers so we can remove faulty products from the market quickly.
Despite these many significant concerns, our Republican colleagues would have taxpayers pay monopoly prices for questionable drugs and devices. Such thinking has fueled the flawed patent system and reimbursement system we have today, which actually disincentivizes innovation.
With a government-granted monopoly and guaranteed Medicare coverage, it is easier to tweak and repackage existing drugs rather than develop a new cure. And while Big Pharma may claim that the billions they earn on these drugs are devoted to research and development for new cures, the reality is that manufacturers spend more on marketing and propaganda than R&D, more on stock buybacks and dividends than R&D.
The real angel investors in R&D are American taxpayers. From 2010 to 2019, every single newly approved drug relied on taxpayer-funded research and taxpayers funded half of total R&D spending. U.S. taxpayers remain the single largest source of R&D funding in the world.
Yet American patients continue to face the very highest prices—forcing them to ration or skip necessary medications altogether.
We have a responsibility to ensure that patients come first and that it is their health and livelihoods, not drug prices, which must be nonnegotiable. Unaffordability and inaccessibility are not the unavoidable side effects of innovation. They are the result of unrestrained monopoly power. I thank all of our witnesses for joining us today to examine that monopoly power and I hope that moving forward we will not once again yield to the power of Big Pharma and instead move to advance reasonable solutions to promote competition and achieve lower prices.
Original source can be found here