The bipartisan FAIR Drug Pricing Act takes the first step to address skyrocketing prescription drug costs
Drug corporations’ aggressive increases in prescription drug prices are making lifesaving treatments unaffordable for families, taxpayers and our health care system
U.S. Senators Tammy Baldwin (D-WI) and Mike Braun (R-IN) and U.S. Representatives Francis Rooney (R-FL) and Jan Schakowsky (D-IL) introduced the FAIR Drug Pricing Act. The bipartisan, bicameral legislation takes the first step in addressing skyrocketing prescription drug prices by requiring transparency for pharmaceutical corporations that plan to increase drug prices. Senators Lisa Murkowski (R-AK) and Tina Smith (D-MN) have also signed on as cosponsors of the FAIR Drug Pricing Act.
Congressman Rooney stated, “The rising cost of prescription drugs is spiraling out of control. Millions of Americans cannot afford their medication, putting their lives and health at risk, and costing taxpayers billions in Medicare costs. Prices must be lowered, and access to vital drugs must increase for American consumers. My goal is to lower prescription drug prices by increasing transparency, and that is why I am introducing the FAIR Drug Pricing Act– to make big pharmaceutical companies justify the price hikes on the medicines that Americans need.”
“For too long, I’ve heard story after story from Wisconsinites who are struggling to afford the life-saving medications they need,” said Senator Baldwin. “Drug corporations are making prescription drugs more and more expensive with no systematic transparency to taxpayers. My bipartisan reform will change that and demand answers from drug companies who are jacking up the prices on the medications that Americans need. It is time for Congress to take action and take on the rising costs of medicine people depend on.”
“It’s time for pharmaceutical companies to clean up their act, otherwise they will be stuck with one customer: the federal government,” said Senator Braun. “This legislation will help push them into the right direction by requiring transparency and justification before drug companies can increase the cost of certain drugs by more than 10 percent over one year or 25 percent over three years.”
“Drug pricing reform is a bipartisan priority that we must address now. The American people are demanding to know why life-saving prescription drugs that are developed with their taxpayer dollars cost them so much. I am proud that Senators Tammy Baldwin and Mike Braun have now joined me and Representative Rooney in introducing this long overdue legislation to expose the profiteering of drug corporations. The bill will for the first time give taxpayers notice of price increases and bring basic transparency to the market for prescription drugs. There are no loopholes or carveouts in this bill, and I hope that my colleagues will join me in fighting for the passage of this bill so that Big Pharma will finally have to answer to answer to the American people,” said Congresswoman Jan Schakowsky.
Over the past five years, brand name drug prices have increased at 10 times the rate of inflation. AbbVie has increased the price of top-selling anti-inflammatory drug Humira by almost 250 percent in the past five years to nearly $40,000. Pfizer regularly increases the price of its drugs – often twice a year. In 2017, Pfizer raised drug prices twice by an average of 20 percent for more than 90 drugs.
Meanwhile, American taxpayers continue to pay more each year because of the rising costs of drugs. Medicare spent nearly $130 billion on prescription drugs in 2016, and Medicare’s portion of U.S. national drug spending has increased from 18 percent in 2006 to 30 percent in 2017.
The Fair Accountability and Innovative Research (FAIR) Drug Pricing Act would require drug manufacturers to disclose and provide more information about planned drug price increases, including research and development costs. Increased transparency will help provide much-needed context for taxpayers, consumers and policymakers about the costs and value of medications and may also incentivize companies to reassess the long-standing practice of relentless drug price increases.
Specifically, the FAIR Drug Pricing Act would require drug manufacturers to notify the U.S. Department of Health and Human Services (HHS) and submit a transparency and justification report 30 days before they increase the price of certain drugs that cost at least $100 by more than 10 percent in one year or 25 percent over three years. The report will require manufacturers to provide a justification for each price increase, manufacturing, research and development costs for the qualifying drug, net profits attributable to the qualifying drug, marketing and advertising spending on the qualifying drug, and other information as deemed appropriate. The bill will not prohibit manufacturers from increasing prices, but it will, for the first time, give taxpayers notice of price increases and bring basic transparency to the market for prescription drugs.
The FAIR Drug Pricing Act is supported by AARP, Campaign for Sustainable Rx Pricing, National Multiple Sclerosis Society, Patients For Affordable Drugs, American College of Physicians (ACP), American Academy of Neurology, Blue Cross Blue Shield Association, The Medicare Rights Center, Families USA, Center for Medicare Advocacy, Inc., Marshfield Clinic Health System, Security Health Plan, Alliance of Community Health Plans (ACHP), National Committee to Preserve Social Security and Medicare, Alliance for Retired Americans, and Medicare Rights Center.
“Big Pharma has a demonstrated track record of price-gouging American patients and squeezing taxpayers with opaque list price increases,” said Campaign for Sustainable Rx Pricing (CSRxP) executive director Lauren Aronson. “The FAIR Drug Pricing Act would introduce much needed transparency to the marketplace by requiring drug makers to justify price hikes. We applaud the bipartisan leadership of the FAIR Drug Pricing Act’s sponsors.”
“Medications can only change lives if people can afford them,” said Bari Talente, Executive Vice President of Advocacy at the National Multiple Sclerosis Society. “While bringing down high prescription drug costs will require a combination of policy changes, the FAIR Drug Pricing Act will lead the way by requiring both advanced notice and justification of price increases above certain threshold amounts. Under these thresholds, several manufactures of MS disease-modifying therapies would need to justify price increases for their MS products. We applaud Senators Baldwin and Braun and Representatives Schakowsky and Rooney for taking this important first step to addressing high drug costs.”