BIO Says Drug Coverage, Not Price Discounts, Will Help Seniors
WASHINGTON, D.C. (June 20, 2000) - Carl B. Feldbaum, president of the Biotechnology Industry Organization (BIO), issued the following statement on an initiative announced today by some states to adopt legislation similar to Maine's drug price control bill.
"We urge other states not to follow Maine's example of a bill that ultimately will reduce the number of medicines available to patients. These measures not only hurt patients, but also damage the biotechnology industry, whose companies are the pioneers in developing new therapies and cures for age-related illnesses, such as heart disease, various cancers and Alzheimer's.
"BIO wants all people, especially seniors, to have affordable access to medicines. The best way to achieve that is through affordable access to private-sector drug coverage under Medicare, which should include stop-loss benefits to make sure seniors get the medicines they need when they are sickest and their bills are the highest. "Imposing mandatory drug price discounts, or price controls, in the short run helps achieve a small percent decrease in drug costs, but coverage will help seniors more. The distinction between discounting and coverage can mean the difference between 10 to 15 percent off a $3,000 outpatient prescription drug or a $10 to $15 co-payment for that same product."
"Price controls don't work in a free economy. They discourage the private investment required to fund the research-intensive biotechnology industry. They also undermine economic development efforts to build a biotechnology presence, which many states desire. A new BIO report, prepared by Ernst & Young, explains why." (It is available on BIO's Web site at www.bio.org)
"Last year," Feldbaum said, "the biotech industry generated nearly half a million U.S. jobs. By comparison, biotech firms directly employed more people than all the companies in the toy and sporting goods industry. The study found the biotech industry in 1999 spent $11 billion on research and development, more than 50 percent of its revenues, which totaled $20 billion for the year. The industry also paid $10 billion in federal, state and local taxes.
"We urge states and the federal government to consider three essential points in discussions on Medicare reform:
· Small biotech companies - many of whom are years away from having commercial sales - are in the forefront of discovering, developing and bringing to market the next generation of life-saving medicines. Many drugs are targeted at preventing or curing diseases that affect seniors, highlighting the importance of ensuring seniors' access to these medicines and helping them get drug coverage.
· Increasing seniors' access to prescription drugs through fiscally responsible, decentralized, private-sector coverage is the best way to help seniors access drugs that are safe and affordable.
BIO represents more than 900 biotechnology companies, academic institutions and state biotechnology centers in 49 states and 26 nations. BIO members are involved in the research and development of health care, agricultural and environmental biotechnology products.