A few weeks ago, House Speaker Nancy Pelosi (D-CA) released her drug pricing package, the Lower Drug Costs Now Act (H.R. 3). This unprecedented proposal would upend our free-market health care system and abdicate domestic drug pricing decision-making to U.S. and European government bureaucrats. It will eviscerate the free market that has promoted innovation, cures and treatments for millions of Patients.
H.R. 3 would require the Secretary of Health and Human Services (HHS) to directly negotiate annually the price of up to 250 brand-name drugs that lack a generic or biosimilar competitor and have the greatest cost to the U.S. health care system. The legislation would establish an upper limit for the price reached in any negotiation as no more than 120 percent of the volume-weighted average of the price of six countries (Australia, Canada, France, Germany, Japan, and the United Kingdom) -- referred to as the Average International Market (AIM) price. The goal is for HHS to negotiate a price that is below the AIM, which price would apply to all purchases within the entire Medicare program. If that is not bad enough, the bill would require this "negotiated" price to be offered to the commercial market as well. If a manufacturer does not agree with the maximum price set by HHS, they will be assessed a tax penalty starting at 65% of the annual gross sales for that drug, increasing 10% a quarter to a maximum of 95%.
While H.R. 3 does create a $2,000 out-of-pocket limit on Medicare Part D beneficiary prescription drug costs -- a positive development -- the bill also imposes a very significant new financial burden on drug companies to cover the costs of providing drugs to Part D beneficiaries -- with mandatory discounts of 10% up to the catastrophic OOP limit, and the 30% discounts thereafter. This new obligation is far in excess of company contributions in the Medicare Part D "donut hole" today.
The three committees with jurisdiction over H.R.3 are moving forward quickly, all having held markups. Democratic leaders are setting an aggressive timeline for action with the hope of having the legislation potentially pass the House floor
by the end of October
. Currently, all of the Committee Chairs and Democratic leadership are in full support of this proposal and process. At this point, House Republicans are united in their strong opposition to H.R.3., calling it socialist, partisan and government-run health care.
BIO's advocacy team has been engaging Democrats and Republicans in Congress aggressively, but
WE NEED YOUR HELP!
- Please reach out directly to your Members of Congress to urge them to OPPOSE H.R. 3 by going to www.savecures.org.
- If you are the CEO/President of a small biotech, please agree to sign the below Letter from Small Companies opposing HR 3.
- If you agree to sign the letter, please send your electronic signature -- including your name, title, company -- to Ben Collins at email@example.com.
- Send the below Investor Letter to your contacts in the Venture Capital community.
- If they agree to support the letter, they can send their electronic signature -- including name, title, company -- to Ben Collins at firstname.lastname@example.org.
Talking Points and Information:
We need to work together to find solutions to ensure Patients have affordable access to drugs, but importing foreign price controls is not the answer. This is a challenging time, but together we can defeat bad policy and preserve the carefully constructed policy ecosystem that makes your life-saving work possible.