Stop Sticker Shock at Pharmacy Counter

Stop Sticker Shock at Pharmacy Counter

With U.S. Senator Chuck Grassley


Q: What are Pharmacy Benefit Managers (PBMs) and why are
you working to reform how they operate?


A: So far
this year, I’ve held 61 county meetings across the state. I’m hearing from
Iowans how it’s harder than ever to make ends meet. Paying for gas and
groceries is taking a bigger bite out of their wallets. And that makes it even
harder to pay for the soaring prices of prescription drugs. Sticker shock at
the pharmacy counter is more painful than ever. For several years, I’ve led the
effort in Congress to push for bipartisan consensus on reforms that would drive
down the costs to consumers without harming medical breakthroughs that
generations of Americans depend on to lead healthier, longer, more productive
lives. When I chaired the Senate Finance Committee, I conducted a two-year
investigation into insulin drug prices and called Big Pharma and insurance
executives to testify on Capitol Hill, as well as the Pharmacy Benefit Managers
(PBMs) who serve as the middlemen in the complex prescription drug supply
chain. Through my investigative work, examination of policy and feedback from
Iowans, it’s clear the drug pricing structure needs transparency to root out
unfair and deceptive practices that enable prescription drug prices to
skyrocket. Sunlight will help rein in abusive pricing schemes and bring
accountability to the drug prices paid by taxpayers, patients and employers. I
worked with Sen. Pat Leahy of Vermont to stop anticompetitive shenanigans used
by Big Pharma that delay more affordable generic drugs from reaching the
pharmacy store shelves. Our 
CREATES Act was signed into law in 2019
and will save consumers and taxpayers billions of dollars in the coming decade.
bipartisan Right Rebate Act was
also signed into law during the Trump administration and closes a loophole Big
Pharma exploited to misclassify drugs in the Medicaid Drug Rebate Program and
fleece the taxpayer for billions every year.


Most recently, I introduced a bipartisan bill with Sen.
Maria Cantwell of Washington that would require the Federal Trade Commission
(FTC) to go after PBM abusive practices and examine the pricing structures,
such as spread pricing. This practice is when the PBM pays the pharmacy one
price but charges the patient’s health plan a higher rate to pocket the
difference. Our 
Pharmacy Benefit Manager Transparency Act would help eliminate deceptive pricing schemes; ban
PBMs from clawing back payments to pharmacies; and, require PBMs to report to
the FTC how much money they make through spread pricing and pharmacy fees. The
nonpartisan budget scorekeepers at the Congressional Budget Office estimate
ending spread pricing in Medicaid would save taxpayers about $900 million over
the next decade.



Q:  Should the federal government negotiate drug
prices for the Medicare program?


A: First,
let’s be crystal clear what “negotiate” means. It means the government would
dictate drug prices, there would be no negotiation. That puts government
bureaucrats between Americans and what’s in their medicine cabinets. Setting
the prices pharmaceutical companies can recover for research and development
would dry up innovation, cede our American ingenuity and leadership to China,
deny consumer choice and ration access to lifesaving medicines, therapeutics
and cures. When I chaired the Senate Finance Committee in 2003, I wrote the
most comprehensive modernization to Medicare since it was enacted more than
five decades ago. My bill created a voluntary Part D prescription drug benefit.
Today, 49 million seniors have prescription drug coverage. At that time, I
stopped the progressive push to put the federal government in charge of a
one-size-fits-all drug pricing regime. Instead, my bill fostered competition to
keep costs low, expand patient choice and encourage innovation for better cures
to Americans. Analyses by the Congressional Budget Office, Council of Economic
Advisers, and the University of Chicago all estimate that fewer drugs and
treatment would be invented over the next generation if the federal government
dictates the price for medicines. Countries with socialized medicine may be
willing to accept fewer cures, but I believe we should encourage more
innovation and cures while lowering costs for patients and taxpayers. And yet,
the Biden administration and others want the federal government to dictate drug
prices. The Build Back Better agenda included it among its Big Government
planks. Americans can breathe a sigh of relief these socialist price controls
were stopped in the U.S. Senate thanks to longstanding rules that force
collaboration and consensus, commonly known as the filibuster. In the meantime,
not given up on
my work to pass my bipartisan Prescription Drug Pricing Reduction Act.
Instead of harmful socialized price controls, my bill would not hamper new
drugs from coming to the market. It would lower costs for seniors by $72
billion, save taxpayers $95 billion, cap out-of-pocket expenses at $3,100, and
cap year-over-year drug prices in Medicare at the inflation price index. It
would also 
reduce costs for
life-saving diabetes drugs. In a nutshell, it would end unlimited
taxpayer-funded subsidies to Big Pharma, an approach supported by the free
market CATO Institute. My bill can clear the 60 vote threshold in the U.S.
Senate if the Majority Leader would bring it for a vote. Partisan ideas have
gotten us nowhere and Americans have paid the price. Lawmakers need to come to
the table and do what’s right for patients and taxpayers.