Manufacturers: Price Controls Harm Innovation, Therapies and Cures; Congress Should Look at PBMs to Cut Drug Costs
Washington, D.C. – Following the release of prices set for the first 10 prescription drugs that were subject to price controls under the Inflation Reduction Act, National Association of Manufacturers President and CEO Jay Timmons released the following statement:
“The pricing mandates released by the Department of Health and Human Services on groundbreaking medicines harm innovation and will slow the development of needed therapies and cures by hampering manufacturers’ ability to pioneer new drugs and treatments. America has led the way in medical and scientific breakthroughs to battle the most devastating and severe illnesses and conditions. There are so many more diseases for which we need to find a cure—like cancer, juvenile diabetes and Alzheimer’s to name just three—and this price control scheme threatens our ability to do so.
“Health care manufacturers in the U.S. invest more than $100 billion annually to create new medicines, putting nearly 17% of their sales right back into R&D. Developing and putting a new drug on the market is a particularly costly and risky endeavor, costing $2.3 billion and taking 15 years, on average. More than 90% of experimental drugs ultimately fail, resulting in billions of dollars of lost investment. But biopharmaceutical manufacturers are committed to finding treatments and cures to devastating diseases like cancer.
“Price controls will limit R&D, plain and simple, as every dollar of revenue curtailed by price controls is a dollar that can’t be devoted toward the astronomically high cost of developing a new medicine.
“This will have an immediate impact on the White House’s manufacturing strategy. Manufacturers are ready to take the lead following President Biden’s announcement Tuesday of $150 million in grants toward his Cancer Moonshot initiative, to prevent more than 4 million cancer-related deaths by 2047, but we’re concerned that goal could be hampered and delayed by the mandates within the IRA.
“There is ultimately a human cost to anything that slows or halts biopharmaceutical manufacturers’ work to develop new treatments or expand production and make those treatments more widely available. Americans’ quality of life will suffer—or they may even lose their lives—because a new treatment was not available in time.
“To truly help Americans, Congress should begin by curtailing the middlemen who are really driving up the prices without giving anything back, such as pharmacy benefit managers. PBMs have severely distorted the cost of pharmaceuticals and lifesaving therapies, driving up the price for patients and employers alike. PBM reform is the way to drive down costs.”
-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 $2.89 trillion to the U.S. economy annually and accounts for 53% 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.