Landmark Proposal Introduced by Group of Key Senate Democrats to Improve the Affordable Care Act by Addressing Skyrocketing Drug Prices

WASHINGTON, D.C. [03/29/17]— In the wake of Congressional Republicans’ failed attempt to rip health coverage away from millions of Americans, U.S. Senator Cory Booker and a key group of Senate Democrats launched a major push to improve the Affordable Care Act (ACA) by bringing down the skyrocketing price of prescription drugs, one of the main reasons why health care costs are rising.

An overwhelming majority of Americans agree that prescription drug prices are too high and that we need action to lower prices. The Improving Access to Affordable Prescription Drugs Act would help ensure that drug companies put patients before profits and bring some much-needed relief to families and seniors, including many who have had to make the impossible choice between paying for a life-saving drug and putting food on the table.

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This important legislative package, which is supported by a wide range of organizations and patient advocacy groups, was introduced today by Sens. Booker (D-N.J.) Al Franken (D-MN), Bernie Sanders (I-VT.), Sheldon Whitehouse (D-R.I.), Sherrod Brown (D-OH), Amy Klobuchar (D-Minn.), Elizabeth Warren (D-Mass.), Tammy Baldwin (D-Wis.), Jack Reed (D-R.I.), Kirsten Gillibrand (D-N.Y.), Maggie Hassan (D-N.H.), Dick Durbin (D-Ill.), Chris Van Hollen (D-Md.), Jeff Merkley (Ore.), Tom Udall (D-N. Mex.), and Richard Blumenthal (D-Conn.).  

The landmark proposal, which the Senators said they want to see included in upcoming legislative debates, seeks to tackle prescription drug costs by increasing transparency and accountability, boosting access and affordability of key drugs, spurring innovation, and increasing choice and competition.

“Life-saving drugs can only save lives if people can afford them, and we must do more to reduce the price of prescription medications,” said Sen. Booker. “This proposal seeks to advance several important measures which would make drugs more affordable, keep them available, and ensure that innovation in developing medications moves forward.”

“We need to bring down prescription drug prices. No American should have to skip meals or turn off their heat in order to afford needed medications,” said Sen. Franken. “But right now, that’s exactly what’s happening. Companies are putting profits before people and setting prices far beyond the reach of Minnesotans, which is driving up costs. Our comprehensive legislation will bring down prescription drug prices. We are working on real solutions to address real problems facing Americans. I strongly urge Congress, and the President—who has committed to addressing drug prices—to make this legislative package a top priority.”

“The American people are fed up with paying by far the highest prices in the world for prescription drugs,” said Sen. Sanders. “It’s time for Congress to stand up to the power and greed of the pharmaceutical industry. This legislation will do just that by allowing the United States to import prescription drugs and Medicare to negotiate drug prices. I hope my Republican colleagues and President Trump will have the guts to support this bill and others and take on the pharmaceutical industry.”

“Too many Rhode Islanders are stuck choosing between food for dinner and the prescription drugs they need to stay healthy,” said Sen. Whitehouse.  “This bill would take sensible steps to help contain costs like letting Medicare negotiate drug prices, forcing drug companies to show how they spend their profits, and permitting individuals and pharmacies to import drugs from countries where they’re cheaper.  Big drug companies may not like it, but consumers deserve the relief.”

“We can’t ask Ohioans to choose between paying for medicine and putting gas in the tank or food on the table,” said Sen. Brown. “President Trump said he wanted to lower drug costs and we're offering concrete proposals to make that happen.”

“It's been suggested in the last week that lawmakers should 'move on' from healthcare,” said Sen. Klobuchar. “But we can't walk away when families are forced to decide between buying food and filling a prescription, or paying the mortgage and taking a drug as prescribed. I’ve introduced multiple bills to bring down costs of prescription drugs by making it easier for generics to enter the market, bringing in competition from Canada, and letting Medicare Part D negotiate for lower prices. I’ll continue to work with my colleagues on both sides of the aisle to get these passed and signed into law. This legislative package my colleagues and I introduced today includes several of these measures, including my bill to crack down on anti-competitive pay-for-delay pharmaceutical deals that would help ensure Americans can fill the prescriptions they need at prices they can afford. We aren't walking away. We are digging in.”

“Too many Americans worry that when they go to the doctor, they won’t be able to afford their medicine. That’s not ok, and we have a responsibility to act,” said Sen. Warren. “There’s no silver bullet to lower drug prices, but this bill offers a menu of solutions to tackle the drug pricing problem and help bring down health costs for everyone." 

“We all know what the problem is, so let’s work together on a solution. Washington needs to work across party lines, take on drug corporations, and act on soaring prescription drug prices.” said Sen. Baldwin. “If we advance reforms that strengthen accountability for pharmaceutical companies, allow Medicare to bargain for lower prices and give families access to safe imported drugs, we will increase choice and competition. This legislation is a perfect opportunity for us to make a strong commitment to our families that we are ready to work to lower health costs for all Americans.” 

“Prescription drug costs are out of control,” said Sen. Reed. “Too many Rhode Islanders tell me they can’t afford, nor understand why, their live-saving medications cost so much.  The straight forward steps in this bill and others, like allowing Medicare to negotiate the best price for prescription drugs on behalf of our seniors, are something I have championed for years.

“Our bill would for the first time impose stiff penalties on drug companies that gouge their patients,” said Sen. Gillibrand. “We’ve seen too many cases where drug companies have cruelly inflated their prices on prescription drugs just because they could get away with it, without any concern for how their actions would affect sick New Yorkers who are desperate for access to life-saving medicine. I am proud to introduce this bill with my Senate colleagues, and I will continue to do everything I can to make sure that New Yorkers never have to bankrupt themselves when they get sick and need to pay for medicine.”

“It is long past time for Congress to put patients first by coming together and acting to lower the cost of prescription drugs," said Sen. Hassan. "This bill helps ensure that seniors and families can afford the medication they need through common-sense steps including cracking down on bad actors who hike the cost of prescription drugs that have been on the market for years or who play games to prevent competition. I will continue working with anyone who’s serious about addressing the rising costs of prescription drugs and ensuring that all Americans can afford critical care.”

“Too many Americans are forced to choose between paying for life-saving medicine and providing for their families, even as pharmaceutical companies continue raking in record profits,” said Sen. Durbin. “It’s long past time for Congress to put people over profits. This legislation would help curb price hikes and bring much-needed transparency to price setting in the prescription drug industry.”

“The Affordable Care Act has markedly improved our healthcare system, but we must constantly fight to improve it,” said Sen. Van Hollen. “One area where improvement is necessary is prescription drugs, which have become unaffordable for too many Americans. This legislation aims to address soaring drug prices on many fronts, encouraging innovation in the pharmaceutical industry and giving Americans more choices. Prescription drugs are only effective if patients can afford to take them, so bringing costs down is a priority for public health and the financial security of American families.”

“It’s outrageous that investors have been buying up drug companies and hiking the cost of lifesaving drugs to ten or twenty times their previous price,” said Sen. Merkley. “It’s criminal, and it must stop. We need to make sure that prescription drugs are accessible and affordable to every American family.”

"From inexplicable price hikes for the life-saving EpiPen to astronomical costs for specialty biologics, Big Pharma is gouging Americans and driving U.S. health care costs through the roof. New Mexicans shouldn't feel like they have to go without critical medication or buy it in Mexico or Canada," Sen. Udall said. "We have a window of opportunity now to provide meaningful solutions so that our health care system is not held hostage by volatile drug prices and an industry with little accountability or transparency. I urge President Trump and congressional Republicans to seize this chance and work with us to rein in out-of-control prescription drug costs and fix a problem that affects nearly everyone in our country."

“Skyrocketing prices for EpiPen and other lifesaving medicine make this measure essential to ensure affordable prescription drugs for all Americans,” said Sen. Blumenthal. “Outrageous drug costs force many patients to split pills, skip doses, or simply forgo filling their prescriptions. This financial burden is appalling and unacceptable. By increasing price transparency, cracking down on price gouging, and boosting innovation, this comprehensive legislation would help assure access to vital medicine in Connecticut and the country. These drugs are every bit as essential as electricity, water, and heat—and deserve no less consumer protection.” 

You can read more about the legislation by clicking here or reading below. A companion bill was introduced in the House of Representatives by Reps. Jan Schakowsky (D-Ill.), Elijah Cummings (D-Md.), Rosa DeLauro (D-Conn.), and Peter Welch (D-Vt.).

The Senators’ legislation is supported by:

·         The American Medical Student Association (AMSA)

·         AFSCME

·         Housing Works

·         MoveOn

·         National Committee to Preserve Social Security & Medicare

·         National Physicians Alliance

·         Other98

·         PFAM: People of Faith for Access to Medicines

·         Public Citizen

·         Social Security Works

·         Universities Allied for Essential Medicines (UAEM)

·         AFT

·         Doctors for America

·         Center for Medicare Advocacy

·         Alliance for Retired Americans

Improving Access to Affordable Prescription Drugs Act

Title I: Transparency

Section 101: Drug manufacturer reporting.

To better understand how research and development costs, manufacturing and marketing costs, acquisitions, federal investments, revenues and sales, and other factors influence drug prices, this section requires drug manufacturers to disclose this information, by product, to the Secretary of the Department of Health and Human Services (HHS), who, in turn, will make it publicly available in a searchable format.

Section 102: Determining the public and private benefit of copayment coupons and other patient assistance programs.

To better understand how patient assistance programs affect drug prices and the extent to which drug makers are using independent charity assistance programs to drive up profits, this section requires independent charity assistance programs to disclose to the IRS the total amount of patient assistance provided to patients who are prescribed drugs manufactured by any contributor to the independent charity assistance program. It also requires a GAO study on the impact of patient assistance programs on prescription drug pricing and expenditures.

Title II: Access and Affordability

Section 201: Negotiating fair prices for Medicare prescription drugs.

Medicare is one of the largest purchasers of prescription drugs in the country but, unlike Medicaid and the Department of Veterans Affairs (VA), it is not allowed to leverage its purchasing power to negotiate lower drug prices and bring down costs. This section would allow the Secretary of HHS to negotiate with drug companies to lower prescription drug prices, and directs the Secretary to prioritize negotiations on specialty and other high-priced drugs.

Section 202: Prescription drug price spikes.

Prescription drugs are priced in the United States according to whatever the market will bear and are sometimes subject to drastic and frequent price increases without apparent justification. This makes drugs increasingly unaffordable and creates significant uncertainty for patients’ and insurers’ budgets. This section requires the HHS Office of the Inspector General (HHS OIG) to monitor changes in drug prices and take steps to prevent drug manufacturers from engaging in price gouging. 

Section 203: Acceleration of the closing of the Medicare Part D coverage gap.

This section closes the Medicare Part D prescription coverage gap in 2018, two years earlier than under current law, providing faster financial relief to seniors, and requires drug manufacturers to pay a larger share of the costs during the coverage gap.   

Section 204: Importing affordable and safe drugs.

This section allows wholesalers, licensed U.S. pharmacies, and individuals to import qualifying prescription drugs manufactured at FDA-inspected facilities from licensed Canadian sellers and, after two years, from OECD countries that meet standards comparable to U.S. standards.

Section 205: Requiring drug manufacturers to provide drug rebates for drugs dispensed to low-income individuals.

This section restores prescription drug rebates for seniors who are dually eligible for Medicare and Medicaid and extends these rebates to other Medicare patients in Medicare low-income-subsidy plans.

Section 206: Cap on prescription drug cost-sharing.

For plan years beginning in 2019 and later, this section caps prescription drug cost sharing at $250 per month for individuals and $500 a month for families enrolled in Qualified Health Plans and employer-based plans.

Title III: Innovation

Section 301: Prize fund for new and more effective treatments of bacterial infections.

This section creates a $2 billion prize fund at the National Institutes of Health to fund entities that develop superior antibiotics that treat serious and life-threatening bacterial infections and to fund research that advances such treatments and is made publicly available. In order to receive prize funds, recipients must commit to offering their products at a reasonable price, share clinical data, and take steps to promote antibiotic stewardship.

Section 302: Public funding for clinical trials.

This section creates a Center for Clinical Research within the NIH to conduct all stages of clinical trials on drugs that may address an existing or emerging health need.

Section 303: Rewarding innovative drug development.

This section amends various exclusivity periods awarded by the FDA to brand-name pharmaceutical companies in an effort to accelerate competition in the generic and biologics market. First, the bill modifies the New Chemical Entity (NCE) exclusivity period to allow FDA to accept a generic drug application for the branded product after three years rather than five. Second, this section would add in a requirement that products awarded the 3-year New Clinical Investigation Exclusivity must show significant clinical benefit over existing therapies manufactured by the applicant in the 5-year period preceding the submission of the application. Third, this section reduces the biological product exclusivity from 12 years to 7 years.

Section 304: Improving program integrity.

This section would terminate any remaining market exclusivity periods on any product found to be in violation of criminal or civil law through a federal or state fraud conviction or settlement in which the company admits fault.

Title IV: Choice and Competition

Section 401: Preserving access to affordable generics.

This legislation would make it illegal for brand-name and generic drug manufacturers to enter into anti-competitive agreements in which the brand-name drug manufacturer pays the generic manufacturer to keep more affordable generic equivalents off the market.

Section 402 and 403: 180-Day exclusivity period amendments regarding first applicant status and agreements to defer commercial marketing.

This section enables FDA to take away the 180-day generic drug exclusivity period from any generic company that enters into anti-competitive pay-for-delay settlements with brand-name drug manufacturers. 

Section 404: Increasing generic drug competition.

This section introduces new reporting requirements and financial incentives to promote and sustain competitive generic markets.

Section 405: Disallowance of deduction for advertising for prescription drugs.

This section eliminates the tax breaks drug companies receive from the federal government for expenses related to direct-to-consumer advertising.

Section 406: Product hopping.

This section establishes a definition for the term “product hopping” and instructs the FTC to submit a report to Congress on the extent to which companies engage in these anti-competitive practices and their effects on company profits, consumer access, physician prescribing behavior, and broader economic impacts.