A Response To "A Better Deal" on Drug Pricing
BIO's response to "A Better Deal" proposals on drug pricing.
U.S. Drug Spending is 14%, Inline with Other Countries
Spending on prescription drugs is roughly 14% of all health care spending - about the same as in 1960. As a percentage of all health care spending, U.S. spending on prescription drugs is similar to other developed countries.
Rx Drug Spending Grew by Less Than 6% in 2017
The Centers for Medicare & Medicaid Services (CMS) estimate prescription drug spending to grow by less than 6% in 2017.
Premiums for Medicare Part D Beneficiaries are Projected to Decrease
The 2017 Medicare trustees report estimates prescription drug spending in Part D will grow at an annual average rate of less than 5%, which is lower than the trustees projected previously. Premiums for Medicare Part D beneficiaries are projected to decrease by 3% in 2018.
Insures Requires Patients to Pay More for Drugs than Hospital Care
Insurers require patients to pay on average five times more in out-of-pocket costs for prescription drugs than for hospital care. According to one estimate, more than 35% of a drug's list price is rebated back to insurance companies, the government, and other players in the drug supply chain. All too often, these savings are not shared with patients.
Robust and Competitive Marketplace For Drugs is Critical
If the U.S. had European-style price controls in place from 1986 to 2004, an estimated 117 fewer medicines would be available to patients.
Precription Drug Prices Have Been Remarkably Stable
Nearly 90% of all drugs sold in the U.S. are low-cost generic drugs of previously novel brand name drugs, and the generic versions are sold at a fraction of the cost.
Federal "Transparency" Would do Little to Empower Consumers
Federal 'transparency' mandates would fall especially hard on small businesses - the source of 70% of all clinical trials - because they rely on private-sector funding to support their research.
Claims vs. Facts
In July 2017, Democratic lawmakers released “A Better Deal,” an economic agenda that includes policy proposals on prescription drug costs. This document is meant to provide policymakers and the public a thorough response to the claims and policies outlined in the “A Better Deal” agenda.
Plans and Patients in Medicare Part D Pay an Estimated 35% Below Drug Manufacturers List Price
The nonpartisan Congressional Budget Office (CBO) has said that direct government price negotiation in Medicare will not produce real savings unless the federal government is also allowed to set prices and restrict access to certain drugs. Allowing Medicare to negotiate drug prices would undermine a program that is working well for seniors and taxpayers. The Medicare Part D prescription drug program has cost $349 billion less than originally projected and nearly 90% of seniors are satisfied with the program.