Pharma Faces a Turn in the Tides as Biden Demands Health Care Reforms
President Joe Biden promised America he would "protect your health care" when he took office. His latest executive order on Promoting Competition in the American Economy calls to the carpet both healthcare and pharmaceutical companies, demanding "aggressive legislative reforms that would lower prescription drug prices, including by allowing Medicare to negotiate drug prices, by imposing inflation caps, and through other related reforms."
The order from the President comes on the heels of a report from the House that shedding light on the high levels of spending for investors and executives, instead of pouring more into innovative treatments for disease. From 2016 – 2020, 14 leading drug companies spent $56 billion more on stock buybacks and dividends than they spent on R&D.
The pharmaceutical industry is also the most prominent lobbying spender, pouring about $92 million into lobbying in the first quarter of the year.
Biden's plan relies on the FTC to prevent "unfair anticompetitive conduct or agreements in the prescription drug industries, such as agreements to delay the market entry of generic drugs or biosimilars." These are often referred to as "pay for delay" agreements.
He calls out the Department of Health and Human Services to submit a plan in the next 45 days to combat excessive drug prices and enhance domestic pharmaceutical supply chains.
One action required of the FDA is to import lower-priced drugs from Canada. Under former President Trump, the FDA had outlined plans for Canadian drug importation but so far have not approved any state's request to do so.
Even if pushed forward, Canada may disagree. Back in 2019, the country warned they would oppose any plans from the US to buy Canadian prescription drugs if it threatened Canada's own drug supply or raise costs for its citizens.
The American Pharmacists Association also shared "mixed views" on the order. While supporting the combating of high drug prices, the group feels Canadian drug importation threatens patient safety and creates supply chain vulnerability.
"FDA's drug importation program is smoke and mirrors," said Ilisa Bernstein, PharmD, APhA's senior vice president for pharmacy practice and government affairs.
"There is no evidence demonstrating that importing drugs from Canada will lower drug costs for patients. What's costly is the threat to patient safety that these drugs will pose at the pharmacy counter."
Biden also announced nominating Dr. Rahul Gupta as his "drug czar," a name given to the nation's top anti-drug official. Gupta has served in America's opioid epidemic trenches from his previous role as West Virginia's former health commissioner. He will be the first physician to lead the Office of National Drug Control Policy.
Meanwhile, Senate Democrat leaders are excited to advance their massive $3.5 trillion spending plan to finance a significant expansion of the economic safety net. The deal would include a "robust expansion of Medicare" with new benefits for patients, including dental, vision and hearing coverage.
"If we pass this, this is the most profound change to help American families in generations," said Senate Majority Leader Chuck Schumer.
While the deal has no realistic chance of winning Republican support, the bill can still pass if the Democrats can get their entire party onboard.