WASHINGTON, D.C. – Today, U.S. Senator Angus King pressed for action from President Obama to help bring down the soaring cost of prescription drugs for people in Maine and across the country. In a letter sent Tuesday morning, Senator King and a group of lawmakers called for more support in the President’s 2017 budget proposal to help address prescription drug prices and cut health care costs. 

“Prescription drug prices are soaring in the United States, driving up costs in federal healthcare programs and households alike. As a result, patients are left with the unimaginable choice of foregoing life-saving care or depleting family savings. These patients deserve better,” Senator King and his colleagues wrote.

“Most Americans agree that current drug costs are unreasonable. We must act now to address the escalating prescription drug prices and contain rising health care costs,” the continued. “We applaud the measures your administration has advanced in the past on prescription drugs and hope that you will expand on them in next year’s budget.”

The lawmakers urged the President, as he lays out his funding priorities for 2017, to do several things to address this growing problem: allow the government to negotiate prices with drug manufactures, promote competition in the generic drug market, prevent price gouging, and outlaw “pay for delay,” which is a practice where brand drug companies pay generic drug companies to stay out of the market. In addition, the Senators called on the President to implement Medicare policies that will reimburse based on value instead of volume, meaning that drug companies will get paid for their performance in treating people.

In addition to Senator King, Senators Franken (D-Minn.), Bernie Sanders (I-Vt.), Sheldon Whitehouse (D-R.I.), Jack Reed (D-R.I.), Tom Udall (D-N.M.), Sherrod Brown (D-Ohio), and Tammy Baldwin (D-Wis.) also signed the letter.

You can read the complete text of the letter below or by clicking HERE.

+++

February 2, 2016

President Barack Obama

1600 Pennsylvania Ave. NW

Washington, DC 20500

Dear Mr. President,

Last year, your budget proposal included a number of provisions to lower prescription drug costs for federal health programs without compromising quality or access to medications. As you prepare the Budget for Fiscal Year 2017 (FY17) we urge you to again propose policies to help reduce the cost of prescription drugs for Americans and include new measures to promote value. 

Prescription drug prices are soaring in the United States, driving up costs in federal healthcare programs and households alike. The Centers for Medicare and Medicaid report that between 2013 and 2014, spending on prescription drugs in the Medicare program rose by 12.2 percent.  This is a dramatic rise from the low growth rates seen between 2007 and 2013. Hospitals, insurers, and state governments are experiencing similar increases in costs, causing some to restrict access to expensive treatments or impose high cost sharing requirements on patients. As a result, patients are left with the unimaginable choice of foregoing life-saving care or depleting family savings. These patients deserve better.

Fortunately, policy solutions exist to bring down high prescription drug costs, including many that have been advanced in Congress and proposed in your previous budgets. For example, approximately $120 billion could be saved if the government required drug manufacturers to provide rebates on prescriptions for Part D low-income subsidy enrollees in the same way that it does already for Medicaid recipients. Furthermore, allowing the Secretary of Health and Human Services to negotiate drug prices for biologics and other high-cost prescription drugs would result in major cost savings.

Your FY16 budget included a number of policies aimed at reducing pharmaceutical drug costs. Just as many of our offices have long advocated, you sought to prohibit “pay for delay” arrangements, in which brand drug manufacturers pay generic drug companies to delay the introduction of generic competitors. You also proposed increasing prescription drug discounts for Medicare Part D recipients and altering reimbursement for drugs administered under Medicare Part B. The Kaiser Family Foundation estimated that these proposals would have saved the federal government approximately $150 billion in FY16. We ask that you advance these initiatives again in your FY17 budget.

We also ask that you introduce new proposals that account for the changing dynamics in the pharmaceutical drug market. For example, for decades, market competition has held the price of generic drugs in check.  Unfortunately, this is no longer the case. The price of more than one-fourth of generic drugs rose 10 to 100 percent or more in 2014. In your budget for FY17, we encourage you to include policies that will promote competition in the generic market, improve market transparency, and prevent companies from gouging prices on essential medicines.

Looking forward, we also ask that you implement Medicare reimbursement policies that reflect the value of prescription drugs. Last year, your administration launched an unprecedented initiative to shift Medicare reimbursements from volume to value; it’s time that you extend this initiative to prescription drugs. Private-sector initiatives testing the value of new therapies are already underway, and showing promise. However, these efforts have confronted challenging societal questions, including whether a value metric should consider impact on the federal budget, which requires public-private engagement. Your administration can begin this engagement by launching demonstration projects testing various models of value-based payments, such as indication-specific pricing, reference pricing, bundled payments, or other pay-for-performance models.

Most Americans agree that current drug costs are unreasonable. We must act now to address escalating prescription drug prices and contain rising health care costs. We applaud the measures your administration has advanced in the past on prescription drugs and hope that you will expand on them in next year’s budget.

Thank you for your consideration of this request, and we look forward to working with you to address the burden of rising prescription drug costs.

###