There have been numerous media reports referencing dramatic drug price increases after the acquisition or merger of pharmaceutical companies especially on narrow market generic drugs with few competitors. As a result of those news reports, Congress and politicians of all stripes have started to speak out about the topic in broad terms. Just recently, both the House and the Senate have formed groups in an attempt to combat rising prescription prices.
Senate Special Committee on Aging
Senators Susan Collins (R-ME) and Claire McCaskill (D-MO), who together lead the Senate Special Committee on Aging, have announced a bipartisan Senate investigation into pharmaceutical drug pricing. To start their investigation, they have requested documents and information from four pharmaceutical companies: Valeant Pharmaceuticals; Turing Pharmaceuticals; Retrophin, Inc.; and Rodelis Therapeutics.
Each request zeroes in on drugs that have seen recent significant price increases. Valeant’s letter focuses on Nitropress, Isuprel, and Cuprimine; Turing’s letter asks about the increase in Daraprim; Retrophin’s letter references Thiola tablets; and Rodelis’ letter inquires about Seromycin.
Each letter asks for a lengthy list of both documents and information, and requests that the responses be delivered to the committee as they become available, but no later than December 2, 2015.
The Senate committee’s investigation will include a thorough examination of: substantial price increases on recently acquired, off-patent drugs; mergers and acquisitions within the pharmaceutical industry that have occasionally led to dramatic increases in off-patent drugs; and the FDA’s role in the drug approval process for generic drugs, the FDA’s distribution protocols, and the FDA’s off-label regime.
The Senate Special Committee on Aging has tentatively set an initial hearing on this issue for December 9, 2015, and plans to hold subsequent meetings on an as-needed basis in the coming months.
House Committee on Oversight and Government Reform
Representative Elijah Cummings (D-MD), the ranking member of the committee, has formed a task force – the Affordable Drug Pricing Task Force – to engage in “meaningful action to combat the skyrocketing costs of pharmaceuticals.”
The creation of this task force follows previous actions taken by Mr. Cummings, including in May 2015 when he introduced generic drug-pricing legislation in the House (a counterpart to a bill introduced by Senator Bernie Sanders). That legislation was incorporated into the budget agreement approved by Congress in the last week of October.
Cummings made clear during a press conference on Wednesday, November 4, 2015, that he is planning to use fierce rhetoric in an attempt to get public approval of this venture. He spent the press conference not only excoriating drug companies and their executives, but he also brought out posters bearing photographs of J. Michael Pearson, the CEO of Valeant, and Martin Shkreli, the CEO of Turing Pharmaceuticals, turning it into a personal attack against those CEOs.
Cummings commented that, “I believe this [price gouging] unconscionable, and frankly, it’s inexplicable. Patients, hospitals, and healthcare providers in ALL of our districts are affected by this price gouging.” In August, Cummings sought documents from Valeant inquiring about the widely-publicized Nitropress and Isuprel price jumps; his requests were denied because the information was considered “highly proprietary and confidential.”
Representative Cummings called on Republicans to act on high drug prices by saying that a congressional failure to address the “skyrocketing prices of drugs” would be “legislative malpractice.”
During that press conference, he called on Representative Jason Chaffetz (R-UT), the chair of the committee, to issue subpoenas to Turing and Valeant CEOs regarding their drug price hikes for Daraprim and two heart drugs, respectively. Chaffetz has said that he does plan to hold hearings regarding drug prices, but has not yet announced a time or produced a witness list. Cummings has asked Chaffetz to then either immediately force Pearson and Shkreli to testify and turn over their documents, or allow Democrats to act on their own and hold votes on issuing subpoenas.
PhRMA Executive Vice President for Policy and Research, Lori Reilly, has commented that while according to a Kaiser Family Foundation survey, 77 percent of Americans identified the increasing prices of prescription drugs as their number one health care concern, that means they do not like the out-of-pocket cost of medications, which plans can lower by reducing cost-sharing. Ms. Reilly states that the Kaiser survey results do not necessarily mean that the public is worried about the prices that drug companies charge. Mr. Cummings and the task force may be confusing overly broad survey results with public opinion.
The Biotechnology Industry Organization has commented that they are disappointed in the task force’s focus on drugs prices, “We hope that this newly formed task force organized by a small group of House Democrats will take a balanced approach and focus not only on the question of affordability of medicines, but also on the equally critical need to sustain continued medical innovation for the patients of today and tomorrow. We are disappointed, however, to learn that this task force seems likely to be narrowly focused on the cost of prescription drugs, rather than the enormous value they bring to patients, the healthcare system and society in general.”
Only time will tell how honest and serious Congress is about this issue and their investigation, and whether they will use bully-pulpit methods and rhetoric to characterize the entire pharmaceutical industry as greedy institutions or focus on the culprits.