WASHINGTON – U.S. Senate Majority Whip Dick Durbin (D-IL), chairman of the Senate Judiciary Committee, today questioned witnesses during a judicial subcommittee hearing on competition policy, l Antitrust and Consumer Protection titled “A Prescription for Change: Suppressing Anti-Competitive Conduct in Prescription Drug Markets.” During his questioning, Durbin discussed his long-standing efforts to bring transparency and competition to the pharmaceutical industry to lower drug prices for Americans.
Last month, the Government Accountability Office (GAO) released a report – asked by Durbin and Chuck Grassley (R-IA) member of the Senate Judiciary Committee ranking – who discovered that direct-to-consumer (DTC) prescription drug ads contribute to a huge amount of Medicare costs. Durbin asked David Mitchell, president and founder of Patients for Affordable Drugs, if direct-to-consumer advertising (DTC) is good for patients.
“The [GAO] found that between 2016 and 2018, drugs advertised on TV and elsewhere made up 58% of Medicare’s budget for drugs. Coincidence? These ads inflated Medicare spending to $ 320 billion over three years, ” said Durbin. “When it comes to this television ad, since the United States and New Zealand are the only two countries in the world to allow it, what is its value to the consumer? “
Mitchell responded by saying that including prices in drug advertisements – which is currently not mandatory – would help patients better understand what’s going on with their drug costs and make more informed decisions. . He also said that these DTC ads are actually only used to sell more drugs at higher prices.
Durbin went on to ask Geoffrey Levitt, Of Counsel DLA Piper and appearing on behalf of Pharmaceutical Research and Manufacturers of America (PhRMA), to respond to the evidence that pharmaceutical companies are able to play with the patent system to restrict competition and increase prices for patients. Durbin cited the inconsistency between PhRMA’s claims that efforts to lower prices would hurt innovation with the fact that every new drug approval between 2010-2019 benefited from research funded by taxpayers through the National Institutes of Health (NIH), and the colossal amounts spent by pharmaceuticals on advertising and share buybacks, rather than on research and development (R&D).
“The pharmaceutical industry responds to every drug pricing policy proposal by claiming that it ‘would chill innovation’ in America, that a single penny of reduced profits could mean a freeze on life-saving innovation. ” said Durbin. “The thickets we have created in patent law cannot be used for research or innovation purposes or consumer benefits. It’s a monopoly control of some of these drugs so that you can reap the benefits for longer, isn’t it? “
Levitt said it’s not easy to get a patent, and innovation doesn’t end with the approval of a product. However, Durbin cited data showing that America’s 12 best-selling drugs each have an average of 71 patents and that 78% of all new patents obtained are for drugs already on the market.
The video of Durbin’s remarks is available here.
Audio of Durbin’s remarks is available here.
Images of Durbin’s remarks are available here for TV channels.
Durbin sponsored two bipartisan bills aimed at increasing the transparency of DTC advertising for prescription drugs and cracking down on patent manipulation that blocks generic competition. Last month, Durbin and Grassley introduced the Drug Price Transparency for Competition Act (DTC Act). The DTP law would require the disclosure of prices on advertisements for prescription drugs, in order to empower patients and reduce drug spending.
In 2019, Durbin and US Senator Bill Cassidy, MD (R-LA) introduced the REMEDY Act to combat the pharmaceutical industry’s practice of playing with the patent system to expand monopolies on life-saving drugs. The bill removes an incentive for brand-name manufacturers to play with the system by filing an excessive number of tracking patents and allows lower-cost generic competitors to enter the market more quickly. Many high-cost brand name drugs are protected from competition because of their ability to manipulate the system by “perpetuating” or filing many additional patents for their product in an effort to prevent generic competition.
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