WASHINGTON, D.C. – U.S. Sens. Sherrod Brown (D-OH) and John McCain (R-AZ) along with U.S. Rep. Jan Schakowsky (D-IL-09) today introduced legislation to help lower prices of life-saving drugs and save taxpayers billions of dollars over the next 10 years. The Price Relief, Innovation and Competition for Essential Drugs (PRICED) Act would foster competition and provide opportunity for more biologics to enter the marketplace and drive down costs. In the same way the entrance of generics helped increase competition and boost access to more affordable prescription drugs, an increased number of biologics and equally effective “biosimilars” will provide additional competition in the marketplace and make life-saving drugs more affordable for consumers.
Biologics – drugs made using living organisms – currently have the longest exclusivity period of any approved pharmaceutical, which has a chilling effect on innovation, limits competition, and prevents the development and marketability of biosimilars, which are nearly identical copies of biologics. Allowing more biosimilars to enter the market will save patients, taxpayers, and hospitals money. The PRICED Act would reduce the exclusivity period for biologics to ensure that more of these drugs can be developed and made available to consumers faster.
“The high cost of prescription drugs hurts patients, strains Medicare and Medicaid, and drives up private insurance costs,” said Brown. “Among the most expensive prescription drugs, biologics can be effective in treating cancer and other illnesses, but are often too expensive. The PRICED Act will allow for more robust competition in the biologics market and provide for more new, equally effective biosimilars which will help provide more options for consumers and drive down prices. This will save taxpayers billions of dollars while incentivizing innovation that could save lives.”
“Across the country the American people are struggling to deal with astronomical prescription drug costs for life-saving medicines,” said Schakowsky. “Nowhere are those costs more excessive than for biologic drugs. These drugs already come to market at very high prices, yet the manufacturers often increase the prices every year. In fact, Gleevec, that is used to treat cancer, came to market at a cost of $26,400 in 2001, but today it has an annual price tag of $120,000. This is simply outrageous. Today, I’m proud to stand with Senator Brown to introduce legislation that would increase competition in the drug market and lower prices. By reducing the period of exclusivity from twelve years to seven, we can increase competition by allowing for the development of generic versions of these expensive drugs. According to the Department of Health and Human Services, reducing the period of exclusivity would save taxpayers nearly $7 billion over the next ten years, and the Medicare Trustees report showed that we could save Medicare significant amounts of money by lowering drug costs. We must act to help provide relief for millions of Americans who are struggling to cope with these excessive costs.”
“Far too many Americans are being unfairly burdened by the skyrocketing costs of prescription drugs,” said McCain. “It’s simply unacceptable that patients have to worry about filling a prescription because they can’t afford to pay for it. The PRICED Act would inject much-needed competition in the biologics market, bring down costs for live-saving drugs, and save billions in taxpayer dollars.”
Currently, many biologics cost $100,000 or more. High prices, which are often a result of a lack of competition in the market, are unreasonable for patients, insurance companies, and taxpayers. The PRICED Act would reduce exclusivity for biologics in the United States from 12 years to seven years. This will lead to the development of more medicines – including biosimilars – and help more of these life-saving drugs enter the marketplace.
According to the Department of Health and Human Services’ 2017 Budget request, reducing exclusivity for biologics from 12 to seven years would save the federal government and taxpayers $6.9 billion over the next 10 years. In addition, several studies estimate the projected savings from the approval of biosimilars for current high-cost biologics to be anywhere from $44 billion to $250 billion over ten years.
The bill has been endorsed by AARP, Center for Medicare Advocacy, Alliance for Retired Americans, AFL-CIO, UNITE HERE, International Union – UAW, Medicare Rights Center, American Federation of Teachers, the International Association of Machinists and Aerospace Workers, the National Committee to Preserve Social Security and Medicare, Families USA, AFSCME, and Public Citizen.