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May 20, 2025 Blog, Price and Costs

President Trump and former President Biden don't agree on much. But they appear to have found common cause in calling for government price controls on prescription drugs. Patients will pay dearly, as Michael Baker and Douglas Holtz-Eakin explain in two recent pieces for the American Action Forum's "Reality Check-Up: The Truth About Single-Payer Systems. Biden signed the Inflation Reduction Act into law in 2022. It directs the feds to "negotiate" prices for a steadily increasing number of prescription drugs through Medicare. But...

May 7, 2025 Innovation, Issues, Price and Costs

Read comments submitted to the U.S. Department of Commerce by Sally C. Pipes, PRI President, CEO, and Thomas W. Smith Fellow in Health Care Policy, arguing against the imposition of tariffs on pharmaceuticals as part of the Department's examination of pharmaceutical imports and their relevance to U.S. national security interests. Click here to download a copy of Pipes' comments Thank you for inviting public input on the Department's Section 232 examination of pharmaceutical imports and their relevance to U.S. national security interests. As...

April 24, 2025 Issues, Price and Costs

In an interview this month, Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr., appeared open to the idea of Medicare covering drugs like Ozempic and Wegovy for beneficiaries with obesity. "Ideally, over the long term, we’d like to see . . . those drugs available for people after they try other interventions," he said. Delaying coverage of these breakthrough weight-loss medications is not the right approach. Read the entire op-ed here....

April 23, 2025 Issues, Price and Costs

At the top of the new executive order’s priorities for pharma is the pill penalty, which Trump said threatens innovation and favors biologics. Currently, small molecule drugs are eligible for price negotiations sooner than biologics — nine years versus 13 years — and critics have said the law disincentivizes small molecule R&D. The order asks Kennedy to work with Congress to end “the distortion that undermines relative investment in small molecule prescription drugs.” “We’re already seeing it where research is being skewed...

April 22, 2025 Issues, Price and Costs

More than 4 in 5 Americans blame the pharmaceutical industry’s profits for the high prices of prescription drugs. It’s little wonder, then, that roughly the same share supports placing price controls on prescription drugs through Medicare. The logic is straight out of Robin Hood. Our leaders should take from the “rich” drug companies and give to the “poor” patients. Read the op-ed here....

April 20, 2025 Innovation, Issues

Surveys confirm that most Americans recognize the value of prescription drugs. But the same surveys also show that Americans are worried that they will be unable to afford needed medicines. These conflicting feelings exemplify the inherent tension when it comes to prescription drugs – how do we incentivize innovation to help patients who lack efficacious treatments while also promoting greater affordability for medicines today? Too often, proposals get this balance between innovation and affordability wrong. Read the entire op-ed. ...

April 7, 2025 Innovation, Issues

Rising demand for long-term care is inevitable as more and more baby boomers retire. Meeting this demand will be a challenge. Recent evidence from the PACE program demonstrates that for-profit care providers can help meet this growing demand, but only if the regulatory environment allows it. Read the entire op-ed here....

April 3, 2025 Issues, Policy Proposals

President Donald Trump’s executive order on global tariffs have pushed downward the stocks of biopharma and med-tech companies, even though the impacts of his 10% baseline tariff – which excludes pharmaceuticals – and his reciprocal tariffs affecting about 60 countries across the globe, are still unclear. “The story for the day is there’s still a lot of uncertainties in terms of pharmaceuticals,” said Wayne Winegarden, senior fellow and director of the Center for Medical Economics and Innovation at the Pacific Research...

April 2, 2025 Issues, Price and Costs

A new paper by the America First Policy Institute, a think tank with close ties to the Trump administration, has revived the debate over global drug pricing. The paper points out that patients in the United States tend to pay considerably more for brand-name prescription drugs than those in most other wealthy nations. The think tank argues that the Trump administration should find ways to force other countries to pay more for drugs — and thus pick up a more equitable...

March 31, 2025 Issues, Price and Costs

The U.S. Senate last week confirmed former Johns Hopkins surgeon and professor Dr. Marty Makary to lead the Food and Drug Administration. During his confirmation hearing, Makary said his goals for the agency were "more cures and meaningful treatments for Americans." Throughout the hearing, he offered insight on how he would achieve those goals, including leveraging artificial intelligence and making other regulatory changes to streamline the drug review process. That's great news for patients. Read the entire op-ed here....

March 24, 2025 Blog, Innovation, Price and Costs

An analysis by the American First Policy Institute released today correctly notes that the drug price controls most OECD countries impose on innovative medicines jeopardize future innovations. Yet, while correctly diagnosing their high cost, the authors still recommend that price controls should be imposed on U.S. patients. Adopting such a policy will worsen health outcomes while potentially raising overall healthcare spending even more. The cost of capital for developing a new drug is $2.9 billion, including post approval research and development costs. Meanwhile, the...

February 27, 2025 Briefs, Price and Costs, Studies

SACRAMENTO – Nevada taxpayers could face millions in new bureaucratic costs and patients will likely see less access to life-saving drugs if state government mandates so-called “Maximum Fair Price” price controls on prescription drugs, finds a new brief released today by the Center for Medical Economics and Innovation at the nonpartisan, California-based, free-market think tank, the Pacific Research Institute. “Some Nevada lawmakers want to enact government price controls on prescription drugs in the name of lowering costs for patients,” said Dr....

February 5, 2025 Briefs, Innovation, Price and Costs, Studies

READ THE PDF A California appellate court invented out of whole cloth a new and troubling theory of tort liability. Specifically, the court held that drug companies have a duty to develop and bring to market drugs that are supposedly safer and more effective than another, FDA-approved drug the company sells already. The claim rested on factual premises contradicted by all publicly available information, the acceptance of which could seriously disrupt the FDA approval process. This disruption gives rise to an...

January 29, 2025 Issues, Price and Costs

On Jan. 17, just days before leaving office, the Biden administration announced the next 15 prescription drugs dispensed through Medicare Part D that will be subject to price controls on Jan. 1, 2027, under the terms of the Inflation Reduction Act. Among them is the blockbuster semaglutide, a prescription medication sold by Novo Nordisk under the brand names Ozempic, Wegovy, and Rybelsus for the treatment of Type 2 diabetes and obesity. The IRA required the federal government to publish the list...

January 29, 2025 Issues, Price and Costs

On this Wednesday and Thursday, two powerful Senate committees will hold confirmation hearings for Robert F. Kennedy Jr., President Trump's nominee to lead the Department of Health and Human Services. RFK Jr. is no stranger to controversy. But his most radical policy position may be one that relatively few people are talking about. Politico recently reported that RFK Jr. has "expressed openness" to seizing drug companies' patents and relicensing them to generic manufacturers—a move that would effectively implement roundabout price controls on...

January 27, 2025 Issues, Price and Costs

Just three days before President Biden left office, his appointees tried to tie incoming Trump staffers' hands on a health policy decision that affects millions of Americans and tens of billions in federal spending. On January 17, the Centers for Medicare & Medicaid Services announced a new list of 15 drugs under Medicare Part D that will be subjected to price controls under the Inflation Reduction Act on January 1, 2027. The list was announced this month despite the IRA not...

January 24, 2025 Issues, Price and Costs

California State Senator Scott Wiener, D-San Francisco, recently introduced a bill aimed at reining in pharmacy benefit managers (PBMs), the middlemen largely responsible for the dysfunction plaguing our nation’s prescription drug market. Wiener’s effort should attract the support of lawmakers on both the left and right. By cracking down on the activities of PBMs, they can deliver real savings for patients at the pharmacy counter. Read the op-ed here....

January 22, 2025 Innovation, Issues

CMS recently announced the next 15 drugs that will be subject to price negotiations under the Inflation Reduction Act of 2022 (IRA). These are negotiations in name only because CMS can levy penalties on any manufacturer that fails to comply with the process. Since the penalties include an excise tax up to 95% of a drugs total U.S. sales revenue, the law essentially empowers CMS to set its desired prices (e.g. price controls). Price controls discourage R&D spending. With less investment...

January 17, 2025 Blog, Briefs, Issues, Price and Costs

PRI’s scholars responded to today’s action by the Centers for Medicare & Medicaid (CMS) announcing 15 additional drugs under Medicare Part D that will be subject to government price setting effective January 1, 2027.  The action was authorized by the Inflation Reduction Act signed by President Biden in August 2022. According to Sally C. Pipes, PRI President, CEO, and Thomas W. Smith Fellow in Health Care Policy and author of the soon-to-be published book The World’s Medicine Chest: How America Achieved...

January 7, 2025 Briefs, Innovation, Price and Costs, Studies

READ THE PDF Executive Summary Reforms that will strengthen the biosimilar market and expand savings opportunities include: Reforming (ideally repealing) the Inflation Reduction Act’s price control measures. Improving the incentives underlying the current buy-and-bill system to better align the financial incentives of providers, payers, and patients. Promoting greater transparency to the opaque drug rebating system including addressing the rebate wall problem through comprehensive reform or prohibiting the anti-competitive rebating practices that are generally outlawed in other markets. Given biosimilars’ demonstrated ability to...