In an escalating verbal battle, the CEOs of three major pharmaceutical companies defended the high prices of their drugs in front of the US Senate Health Committee last week, drawing them further into a confrontation with lawmakers and the Biden administration over the cost of some of the most widely used prescription medications.
Lawmakers, including panel chairman Senator Bernie Sanders, noted that the companies charged more in the United States than in other wealthy countries, accusing them of profiting at the expense of American patients.
The pharmaceutical executives – from Johnson & Johnson, Merck and Bristol Myers Squibb – conceded that patients in the US paid too much but said that new medications arrived there faster than anywhere else in the world.
Sanders acknowledged that the companies had produced lifesaving drugs, but singled out several commonly used medications, including Bristol Myers Squibb's blood thinner Eliquis, which he noted was much cheaper in Canada than in the US, reports The New York Times.
“Millions and millions of our people cannot afford the outrageously high cost of prescription drugs in this country,” he said.
The three executives who testified – Joaquin Duato of J&J, Robert Davis of Merck and Christopher Boerner of Bristol Myers Squibb – acknowledged that drug prices were often higher in the US than in other wealthy countries.
But they said lower prices in Europe and Canada, where governments are more focused on constraining costs, came with crucial downsides, like long waits for new drugs and limited insurance coverage.
Sanders, who accused the companies of using their profits to enrich executives and shareholders even as patients struggled to pay for medications, tried to solicit a promise from Boerner that the company would lower the US price of Eliquis to that in Canada.
Boerner declined, citing the differences in Canada’s health system. The hearing took place as a new programme authorising Medicare to negotiate the prices of some costly medications gets underway.
Last week, health officials made their initial offers to the makers of the first 10 medications selected for negotiations, a list that includes Eliquis and four other drugs sold by the companies whose executives testified last week.
Pharmaceutical companies, including all three companies represented at the hearing, have filed a flurry of lawsuits arguing that the negotiation programme is unconstitutional.
The hearing follows a standoff between Sanders and two of the pharmaceutical executives, Duato of J&J and Davis of Merck, who agreed to testify only after being threatened with subpoenas.
The two companies suggested last month that Sanders was seeking to retaliate for their lawsuits challenging the Medicare price negotiation programme.
In 2022, prices for brand-name drugs in the US were, on average, at least three times as high as those in 33 other wealthy countries, a recent report funded by the Department of Health and Human Services found, even when taking into account discounts that reduce how much American health plans and employers pay.
However, comparing US drug prices with those in other countries can be tricky because the healthcare systems are so different. While European countries rely on a centralised negotiator, the American system is fragmented, with tens of thousands of health plans and employers relying on intermediaries to handle their negotiations.
At the hearing, the CEOs blamed middlemen – known as pharmacy benefit managers – for saddling patients with high out-of-pocket costs.
Those businesses procure discounts from manufacturers that reduce the bill for health plans and employers but not for patients.
Benefit managers make more money when the sticker price of a drug is higher, but patients often have to pay more. Lawmakers have proposed making modest changes to the practices of benefit managers.
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