Health Care

We need to reduce soaring health care costs, improve the efficiency of the current system and enhance the quality of care. The NAM is working aggressively to drive down health care costs and ensure reforms to America’s health care system are smart and effective—and work for manufacturers and our employees.

News

Study: Price Controls Could Harm Pharmaceutical Manufacturing

The pharmaceutical manufacturing industry is a critical piece of the U.S. economy, creating well-paying, valuable STEM jobs and contributing large sums in value-added output. However, federal price controls could threaten these benefits, according to a new study from the NAM.

What’s going on: The analysis, “Creating Cures, Saving Lives,” was released Wednesday and analyzes the industry’s contributions to the overall economy, as well as ways in which it could be affected by federal price control policies, such as those in last year’s Inflation Reduction Act.

  • In August, the Department of Health and Human Services announced that it had chosen the first 10 drugs for prescription-cost negotiations required by the legislation.
  • Last month, all 10 manufacturers “agreed to participate essentially because they had no choice,” according to reporting by The Hill.

Why it’s important: Controls on drug prices jeopardize innovation and competitiveness—which is why the NAM has long opposed them.

  • What’s more, pharmaceutical manufacturing is a major contributor to the American economy, and government regulations should help, not hinder, it.
  • “Pharmaceutical manufacturers are a major contributor to the U.S. economy, employ[ing] millions of Americans and driv[ing] innovation,” said NAM Chief Economist Chad Moutray. “The industry’s investments in R&D have led to lifesaving treatments and therapies that have improved the quality of life for all Americans. This study explores the negative implications of price control policies on pharmaceutical leadership, putting American jobs and innovation in the health care system at risk.”
Press Releases

NAM Study: U.S. Pharmaceutical Manufacturing Strength Requires Commitment to R&D, Innovative Regulatory Environment

Washington, D.C. – The National Association of Manufacturers released a new study, “Creating Cures, Saving Lives,” which demonstrates the urgency of strengthening U.S. pharmaceutical manufacturing amid policy threats to the sector’s innovative, global leadership.

“Creating Cures, Saving Lives” analyzes the sector’s contributions to the broader economy and its commitment to R&D that drives the development of lifesaving treatments, such as advancements in therapeutics that fight cancer. The study further examines the ways that federal price controls on the sector, such as those contained in the Inflation Reduction Act, could jeopardize these treatments. The study comes at a critical time, as the Centers for Medicare & Medicaid Services recently announced the first tranche of treatments that will be subject to price controls.

“Pharmaceutical manufacturers are a major contributor to the U.S. economy, employ millions of Americans and drive innovation. The industry’s investments in R&D have led to lifesaving treatments and therapies that have improved the quality of life for all Americans,” said NAM Chief Economist Chad Moutray. “This study explores the negative implications of price control policies on pharmaceutical leadership, putting American jobs and innovation in the health care system at risk.”

“Creating Cures, Saving Lives” includes seven key findings on the importance of the pharmaceutical and medical manufacturing industry and the implications of price controls on the sector:

  • The pharmaceutical manufacturing industry is a major contributor to the U.S. economy, and its impact is growing.
    • The industry accounted for $355 billion in value-added output to the U.S. economy in 2021. The direct contribution from the industry of $192 billion is up 24% from just two years ago. The pharmaceutical sector was already an economically vital sector before the pandemic, and it has become increasingly more important in its aftermath.
  • The pharmaceutical manufacturing industry fuels other sectors of the economy, supporting nearly 1.5 million jobs in America.
    • The industry directly employs an estimated 291,000 workers in the United States, an increase of nearly 9% in the past 24 months. One job in the pharmaceutical manufacturing industry helps support 4.1 other jobs in the overall workforce.
  • Industry employees are highly productive.
    • Industry employees produce $1.2 million in output per employee. This is nearly six times more than the U.S. economy’s average output per employee ($208,084).
  • A successful pharmaceutical ecosystem requires strong private-sector investment.
    • The pharmaceutical industry invests 16.6% of its sales back into R&D. Indeed, the U.S. pharmaceutical industry invests nearly 3.5 times more in R&D as a percentage of sales than the average U.S. industry.
  • The pharmaceutical manufacturing industry pays high wages and benefits to American workers.
    • Annual average labor income per worker in the pharmaceutical manufacturing industry is more than $184,000. This figure is higher than some of the highest-paying industries in the country.
  • The industry creates valuable STEM jobs.
    • While roughly 6.6% of the U.S. workforce has a STEM occupation, some 25% of all jobs in pharmaceutical and medicine manufacturing are STEM-related. The pharmaceutical manufacturing sector employs more than four times the percentage of STEM workers employed in the overall workforce.
  • Price control policies, like those in the IRA, may hurt U.S. pharmaceutical leadership.
    • Price controls may deter advancements in health care by reducing investments in R&D, negatively impacting the nation’s economic prosperity.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.91 trillion to the U.S. economy annually and accounts for 55% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Input Stories

Companies Grapple with Rising Health Care Costs


Companies’ health care costs are rising steeply, leading finance chiefs to look for alternative ways of attracting and retaining employees, according to The Wall Street Journal (subscription). 

What’s going on: “Health-insurance costs, which are among the largest expenses for many U.S. companies, are projected to rise around 6.5% for 2024, according to consulting firm Mercer.”

  • “The surge … may add significantly to costs for employer plans that Mercer said already average more than $14,000 a year per employee. Many companies are expected to take on most of the increases … ”

​​​​​​​ Why it’s happening: In addition to inflation and higher interest rates, rising health care price tags are the result of a combination of higher labor costs in hospitals and elsewhere in the health care system, a rise in elective care (which declined during the global pandemic) and a demand for new drugs.

The response: Finance officers are largely seeking ways to manage the growing costs without “add[ing] pressure to employees’ budgets as health care costs rise,” according to the Journal.

  • Whether that will be possible in the longer term will depend mainly on the state of the labor market and how high prices rise.
  • Some companies are considering sharing the increased cost burden with employees, while others are pushing preventive care as a way to save money down the road. 

The last word: “Manufacturers feel a deep commitment to providing high-quality health care to their employees despite the increased costs of doing so,” said NAM Director of Domestic Policy Julia Bogue.

Input Stories

DOJ, ACLU Reach Settlement on Separated Migrant Families

The Justice Department has reached an agreement with the American Civil Liberties Union that would give benefits to thousands of migrant families separated at the border under the previous administration’s policies, according to ABC News.

What’s going on: “Under the proposed agreement, the Justice Department says, new standards would be established to limit migrant family separations in the future. The settlement would prohibit separations unless there are concerns regarding the wellness of the migrant child, national security issues, medical emergencies or in the case of criminal warrants.”

  • The deal—on which a federal judge must still sign off—would also cover any medical costs incurred because of the separations.
  • If approved, it would stay in effect for six years. 

Why it’s important: “[U]nder the settlement, more than 3,900 children and their families would be eligible for temporary relief from future deportation for up to three years, with a chance to renew. Members of those families would also be granted work authorizations.”

  • More than 75% of the originally identified families that were separated have either been reunited or given the information they need to reunite, according to a Biden administration official.
  • “The agreement further expands the number of families that will be eligible for humanitarian parole and reunification, meaning that the ACLU and other organizations will be receiving information on separated families that was previously unknown,” according to ABC News.

Previous policy: A policy in place for four months in 2018 “mandated prosecutions for all suspected illegal border crossings, which led to parents being deported while their children stayed in U.S. custody or were placed in foster care.”

The last word: “The NAM has long called for policy that explicitly prohibits the separation of minor children from their parents, which is what we lay out in ‘A Way Forward,’ our immigration-policy document,” said NAM Director of Domestic Policy Julia Bogue.

Input Stories

Are Seniors Shielding U.S. From Recession?


America’s aging population is one reason consumer spending has remained robust even as the Federal Reserve has raised interest rates, The Wall Street Journal (subscription) reports.

What’s going on: As of August, a record 17.7% of the U.S. population was 65 or older.

  • Senior citizens, whose finances tend to be relatively robust, “accounted for 22% of spending last year, the highest share since records began in 1972 and up from 15% in 2010,” according to Labor Department data cited by the Journal. 

Why it’s important: “Our large share of older consumers provides a consumption base in times like today when job growth slows, interest rates rise and student-debt loan repayments begin again,” Susan Sterne, chief economist at Economic Analysis Associates, told the news outlet.

Longer lives, more spending: In addition to living longer, the elderly are more active than ever before, spending on traveling, hiking, cruises, e-bikes and more.

  • “The average household led by someone age 65 and older spent 2.7% more last year than in 2021, adjusted for inflation, according to the Labor Department, compared with 0.7% for under-65 households.”

Recession buffer: Baby boomers have amassed more than $77 trillion in wealth, according to the Fed—and some economists say that money will help prevent an economic recession.
 

Input Stories

U.S. Life Expectancy Declines


Life expectancy in the U.S. started falling even before the global pandemic—and it’s continuing to decline, according to The Washington Post (subscription).

What’s going on: According to a yearlong investigation by the Post, “[a]fter decades of progress, life expectancy—long regarded as a singular benchmark of a nation’s success—peaked in 2014 [in the U.S.] at 78.9 years, then drifted downward even before the coronavirus pandemic. Among wealthy nations, the United States in recent decades went from the middle of the pack to being an outlier. And it continues to fall further and further behind.”

  • While the opioid crisis and gun violence are contributing to the rising death toll, heart disease and cancer have remained the leading cause of death among people aged 35 to 64.
  • Meanwhile, diabetes and liver disease are becoming more common killers.

A worrisome increase: “In a quarter of the nation’s counties, mostly in the South and Midwest, working-age people are dying at a higher rate than 40 years ago, The Post found.”

  • The trend is exacerbated by economic divisions. In the early 1980s, the nation’s poorest people were 9% more likely to die than their wealthier counterparts. Today, they are 61% more likely to die.

What we can do: “Medical science could help turn things around. Diabetes patients are benefiting from new drugs, called GLP-1 agonists . . . that provide improved blood-sugar control and can lead to a sharp reduction in weight. But insurance companies, slow to see obesity as a disease, often decline to pay for the drugs for people who do not have diabetes.”

  • The FDA has approved several such drugs so far, including Novo Nordisk’s Ozempic and Wegovy and Eli Lilly’s Mounjaro.
Input Stories

Preparing the Supply Chain for Future Pandemics


Manufacturers can take specific steps to improve the resilience of the health care supply chain, the NAM’s latest health care study found.

What’s going on: The study—conducted by the Manufacturing Policy Initiative at Indiana University—analyzes data from the COVID-19 pandemic, when manufacturers in the U.S. had to produce large quantities of critical health care equipment under difficult, fast-evolving conditions.

Building resilience: The study found that to prepare the supply chain for a future disruption of similar magnitude, manufacturers should focus on seven areas:

  • Speed: Manufacturers must be able to satisfy demand quickly.
  • Information: Manufacturers require timely access to accurate information.
  • Cost: Firms face the costs of taking action within the supply chain, as well as the costs of managing market unpredictability and policy environment uncertainty.
  • Networks: Partnerships can support information sharing and networks to help manufacturers navigate the disruption.
  • Size: Supply chain challenges can look different for small, medium-sized and new manufacturers than for larger, established firms.
  • Technology: Tech can help manufacturers increase production, improve efficiency and speed up innovation.
  • Flexibility: Responses can come from unexpected sources and need a flexible policy environment.

The NAM says: “Policymakers should utilize these lessons to bolster our supply chain for the next disruption,” NAM Chief Economist Chad Moutray said. “This analysis … reveals that there are key policy actions needed to strengthen the manufacturing supply chain. Research shows a more balanced regulatory agenda, with an emphasis on clarity, predictability and coordination, will help mitigate the effects of the next disruption.”
​​​​

Press Releases

New Study: U.S. Health Care Supply Chain Resilience Demands Balanced Regulatory Environment

Washington, D.C. – The National Association of Manufacturers released a new study outlining steps to improve health care supply chain resilience to allow manufacturers in the United States to better prepare for and adapt to the next disruption. The study analyzes lessons learned from the COVID-19 pandemic, during which manufacturers across the United States produced critical health care supplies in a highly unpredictable environment that affected every industry level.

“During the COVID-19 pandemic, manufacturers in the United States helped lead our response and recovery and learned many lessons in the process,” said NAM Chief Economist Chad Moutray. “Policymakers should utilize these lessons to bolster our supply chain for the next disruption. This analysis, which was conducted by the Manufacturing Policy Initiative at Indiana University, reveals that there are key policy actions needed to strengthen the manufacturing supply chain. Research shows a more balanced regulatory agenda, with an emphasis on clarity, predictability and coordination, will help mitigate the effects of the next disruption.”

Key Themes

Seven key lessons from the pandemic can be examined for future efforts to build resilience:

  • Speed matters: Manufacturers need to be able to serve demand quickly.
  • Information matters: Manufacturers need timely access to accurate information.
  • Costs matter: Firms face the costs of taking action within the supply chain, as well as the costs of managing market unpredictability and policy environment uncertainty.
  • Networks matter: Partnerships can support information sharing and networks to help manufacturers navigate the disruption.
  • Size matters: Small and medium-sized manufacturers and new firms can be differently—and uniquely—challenged compared with established larger manufacturers.
  • Technology matters: Technology can enable manufacturers to enhance production, innovate or improve efficiency, as well as support broader efforts to build partnerships.
  • Flexibility matters: Responses can come from unexpected sources and need a flexible policy environment.

Areas of Opportunity

The report identifies four key areas of opportunity to enhance health care supply chain resilience:

  • Fostering a conducive regulatory environment: Manufacturers and their partners need clear and streamlined regulations as well as a flexible regulatory framework in advance of the next disruption.
  • Supporting partnerships for stronger information sharing and networks: Sustained information channels between manufacturers and policymakers will improve access to information for all parties and mitigate disruptions.
  • Ensuring a healthier “baseline” industry: Small business plays a pivotal role in the U.S. Robust entrepreneurship and scaling of new manufacturers contribute to a more competitive industry.
  • Prioritizing changing workforce needs: Workforce development must be prioritized so that manufacturers can pivot across product lines and sectors to meet the needs of the next disruption.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.91 trillion to the U.S. economy annually and accounts for 55% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Business Operations

How Novocure’s Anti-Cancer Device Extends Lives

Around 15,000 people are diagnosed every year in America with glioblastoma, a particularly aggressive form of brain cancer. At Novocure—a global oncology and medical device company with its North American flagship facility located in Portsmouth, New Hampshire—scientists and manufacturers have developed a device to revolutionize the way these tumors are treated.

The breakthrough: Novocure’s founder Yoram Palti developed an innovative treatment called Tumor Treating Fields therapy—an approach that uses electric fields to kill cancer cells while sparing healthy ones.

  • For adult glioblastoma patients, the device, called Optune®, consists of wearable, portable adhesive arrays and an electric generator that can be carried in a bag.
  • “Unhealthy cells and healthy cells have different properties,” said Frank Leonard, president, CNS Cancers U.S. at Novocure. “If you can create the right type of electric field, you can exert force and destroy cancer cells as they divide.”

Value added: Crucially, Tumor Treating Fields therapy is being studied together with other therapies, giving patients access to an optimal mix of treatments.

  • “You get the best of both worlds with a device intervention and a drug intervention,” said Leonard. “Patients can wear this device consistently while using Temozolomide, which is the current standard of care chemotherapy agent used to treat glioblastoma.”

Low risk: Unlike drug therapies, which can present a range of adverse effects, Optune® has few side effects beyond mild-to-moderate skin irritation beneath the transducer arrays. As a result, patients can receive the treatment continuously for extended periods of time to attack cancer cells.

  • “Typically, the limiting factor in treating cancer is dose-limiting toxicity—for example, you can only take one or two chemotherapies at the same time because they’re so toxic,” said Leonard.

Getting heard: The company’s device was featured in the award-winning short film “Rare Enough,” which tells the inspiring story of cancer survivor DJ Stewart and his journey in battling glioblastoma.

  • Stewart is a Kansas City–based skateboarder who was first diagnosed with glioblastoma in 2019. Thanks, in part, to Tumor Treating Fields therapy, his life expectancy—once only 13 months—has been prolonged significantly. DJ now serves as a community outreach coordinator for the Head for the Cure Foundation.

Next steps: Novocure believes that Tumor Treating Fields therapy holds significant promise for other types of cancer as well. The company is developing additional wearable devices that could treat countless patients around the world.

  • Lung cancer trials have shown promising results recently, and the company expects to learn more in the coming months from clinical trials involving ovarian cancer, metastases from lung cancer and pancreatic cancer.
  • “We started working first in one of the rarer, yet most aggressive, forms of cancer. There are around 15,000 patients diagnosed with glioblastoma in the U.S. each year,” said Leonard. “But pre-clinical data suggests that Tumor Treating Fields can work with all different tumor types.”

A look to the future: Wearable anti-cancer devices offer an exciting new frontier in the fight against life-threatening diseases, and an important field where manufacturers can make an enormous difference.

  • “In these really aggressive cancers, we still are making advances—and advanced devices that require sophisticated engineering and complex global manufacturing have a role to play,” said Leonard. “There’s a lot the manufacturing industry can do to improve the outcomes of patients, and they should be recognized for that work.”
Input Stories

New COVID-19 Vaccines Coming


A new COVID-19 vaccine is set for a September release as cases of the new virus variant “Eris” rise nationwide, according to Reuters (subscription).  

What’s going on: “Some public health experts hope that Americans will welcome the new shot as they would a flu jab. But demand for the vaccine has dropped sharply since 2021 when it first became available and more than 240 million people in the U.S., or 73% of the population, received at least one shot.”

  • Health care providers and pharmacies will begin offering the updated shots—which target XBB.1.5, “a sub-lineage of the still dominant Omicron variant”—in the second half of next month.
  • The new vaccines still need authorization by the U.S. Food and Drug Administration and recommendation by the Centers for Disease Control and Prevention.

Why it’s important: Though the COVID-19 public health emergency ended in May and the private sector has taken on “much of the duty of vaccinating America,” virus-related hospitalizations are up 40% from June’s lows.

  • “CDC Director Mandy Cohen said last week in a podcast that … Americans should view these shots as an annual measure to protect oneself, in line with the annual flu shot.”
View More