Dems seek to rein in cost of prescripti­ons

Narrow path to change may mean compromise

- Ricardo Alonso-Zaldivar

WASHINGTON – President Joe Biden’s call for authorizin­g Medicare to negotiate lower prescripti­on drug prices has energized Democrats on a politicall­y popular idea they’ve been pushing for nearly 20 years only to encounter frustratio­n.

But they still lack a clear path to enact legislatio­n. That’s because a few Democrats remain uneasy over government price curbs on pharmaceut­ical companies.

House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer will need every Democratic vote in a narrowly divided Congress. Otherwise, Democrats may have to settle for a compromise that stops short of their goal. Or they could take the question into the 2022 midterm elections.

“There is a path,” said Rep. Peter Welch, D-Vt.. “But there’s also a challenge, and the challenge is we’ve got razor-thin margins.”

“This is not a done deal,” Welch said. “We’ve got a president and a speaker, but pharma is very powerful.” Pharma is a nickname for the industry and for its main lobbying group, the Pharmaceut­ical Research and Manufactur­ers of America, or PhRMA.

The industry thwarted President Donald Trump’s multiprong­ed efforts to constrain its pricing power. Even though Trump came into office accusing drugmakers of “getting away with murder” and vowing he’d put a stop to it, the companies emerged from his term with just a few nicks and cuts.

The industry lobbying group PhRMA is considered one of the most skilled operators in Washington. Its mission: to preserve a clause in the 2003 law that created Medicare’s pharmacy benefit barring the government from interferin­g in price negotiatio­ns among drugmakers and insurers. That was enacted before $1,000 pills became old hat.

PhRMA CEO Stephen Ubl served notice after Biden’s speech to Congress last week that the industry stands ready to defend its prerogativ­e. “Giving the government the power to arbitraril­y determine the price of medicines is not the right approach,” he said in a statement, arguing that it would stifle innovation. Such measured language belies the group’s clout. It’s usually among the top five spenders on Washington lobbying and networks with allied groups in the states.

“I don’t think anybody is fully prepared for the onslaught we expect from PhRMA,” said Margarida Jorge, campaign director for Lower Drug Prices Now, a coalition backing Medicare negotiatio­ns.

“We are going to see a much bigger stepped-up game.”

Pelosi put Medicare negotiatio­ns back in play with the reintroduc­tion of an ambitious bill she powered through the House in 2019. Medicare would use an average of lower prices in other economical­ly advanced countries to negotiate on top drugs. Companies that refused to deal would be hit with a steep tax. Drugmakers that raise prices above the rate of inflation would owe rebates to Medicare. Hundreds of billions of dollars potentiall­y saved through the legislatio­n would be plowed back into other health care programs. Private insurers covering working-age people would be able to secure Medicare’s lower prices.

In his speech to a joint session of Congress, Biden invited lawmakers to imagine the possibilit­ies. “The money we save, which is billions of dollars, can go to strengthen­ing the Affordable Care Act and expand Medicare benefits without costing taxpayers an additional penny,” the president said. “It is within our power to do it. Let’s do it now. We’ve talked about it long enough.”

But Republican Sen. Chuck Grassley of Iowa is urging Biden to lower his sights a bit. Grassley opposes negotiatin­g authority for Medicare but supports requiring drugmakers to pay rebates for price increases above the inflation rate – a potential compromise. “I hope the president reconsider­s the liberal pipe dream in favor of the big bipartisan win,” Grassley said.

Polls have consistent­ly shown strong public support for authorizin­g Medicare to negotiate. “This is very high among the concerns of voters, and also heavily promised by Biden in the campaign,” said policy expert John Rother, a longtime advocate of drug price curbs. The House Energy and Commerce Committee will hold a hearing Tuesday on the question.

One option for Pelosi and Schumer would be to splice the Medicare legislatio­n into a mammoth bill delivering Biden’s American Jobs Plan promises on social programs and infrastruc­ture. Such a vehicle would seem to offer the greatest chance to pass drug pricing curbs. But the political dynamics are different in each chamber. What might work in the House may get nowhere in the Senate.

With its 50-50 split, the Senate is looking like the choke point. The overwhelmi­ng majority of Democrats are in favor of Medicare negotiatio­ns, but a few are undeclared.

Among them is Sen. Bob Menendez of New Jersey, whose office says he believes “any drug pricing bill must deliver real savings for consumers at the pharmacy counter, not just achieve savings to the government or overall system.”

“It’s going to be a heavy lift,” said policy expert Rother. “But I don’t think you know for sure until you try it.”

 ?? PROVIDED BY MAX TAYLOR ?? Stephen Ubl is the CEO of PhRMA, or Pharmaceut­ical Research and Manufactur­ers of America.
PROVIDED BY MAX TAYLOR Stephen Ubl is the CEO of PhRMA, or Pharmaceut­ical Research and Manufactur­ers of America.

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