The American pharmaceutical industry is the unquestioned leader in the world regarding the technological development of new medications and procedures. Between 20 and 60 new drugs are introduced to the market in the U.S. each year, far and away the most of any country.
While there are numerous valid criticisms of “big pharma” and its relationship with regulatory agencies, Democrats are openly engaging in warfare with the industry over pricing decisions. They are pressing for a process of negotiating drug prices between Medicare and pharmaceutical companies.
However, the “negotiation” process would consist primarily of Medicare setting the maximum price for particular drugs. By setting prices at a unilaterally determined level, Democrats want to create a fund from the drug cost “savings” to expand Medicare and other allegedly healthcare-related programs.
Likely, Democrats are grossly overestimating the savings that would be recognized through this form of “negotiation.”
As everyone knows, the razor-thin majority Democrats have in the House does not give President Joe Biden, or Speaker Nancy Pelosi much wiggle room in getting their immense $3.5 trillion “Build Back Better” spending gala passed. At least three moderate House Democrats are now threatening the spending bill to include the Medicare “negotiating” measure.
Reps. Kurt Schrader (D-OR), Kathleen Rice (D-NY), and Scott Peters (D-CA) have all said they will oppose the Medicare drug cost negotiating scheme. All three are members of the Energy and Commerce Committee in the House. That committee is one of several involved in debating the contents of the budget reconciliation bill.
The large pharmaceuticals and Republicans have been vehemently opposed to the drug pricing plan, and have taken the position that unilateral pricing will degrade the industry’s ability and incentive to create new drugs of benefit to Americans and people around the world.
Drug pricing involves the recapture of development costs for current drugs and the expected cost of research and development of new processes and medications.
The three moderates who have expressed opposition can derail the entire Biden reconciliation plan and may force broad compromises in other parts of the package. While those three have been open opponents, it is believed that there are other House Democrats who are not sure about supporting the drug pricing plan.
Biden’s tanking approval ratings following the catastrophic withdrawal of U.S. military forces from Afghanistan and the announcement of his unpopular COVID vaccine mandates for private-sector workers nationwide are burning through what is left of his political capital. He may not have much of a “bully pulpit” left from which to press his spending spree program forward before long.