A Cornerstone of Democrats' Agenda Is Suddenly in Deep Trouble
Democrats had a neat plan for their health care agenda. As part of the $3.5 trillion spending bill they’re putting together as I type, they would finally, after years and years of pledges to do so, pass legislation to cut the costs of prescription drugs. This would have two wonderful benefits for the Democrats. First, the obvious: They would fulfill a campaign promise to cut the costs of prescription drugs. Fulfilling popular promises is good! Second, the Medicare drug negotiations—price negotiations between the government and pharmaceutical companies— would save the government hundreds of billions of dollars that Democrats could then use to pay for the rest of their health agenda: covering new services under Medicare, bringing the ACA’s Medicaid expansion to all 50 states, and making permanent the improvements Democrats made to Obamacare’s insurance exchanges in their COVID relief bill earlier this year.
Again, a neat plan on paper. In terms of actually shepherding this idea through Congress, though, there was always one problem that tended to be overlooked: Doing this would require punching the pharmaceutical industry, and its powerful lobby, squarely in the jaw. There’s a big reason such a popular idea—let the government negotiate drug prices!—hadn’t happened already, namely that the pharmaceutical sector wouldn’t take kindly to the threat of losing $500 billion. And now, they haven’t. Which means that, even in the early stages of Democrats in Congress trying to cobble together the Build Back Better Act, the plan is in deep trouble.
This week, the Energy and Commerce Committee met to discuss drug pricing. The legislation that House Democrats wanted to pass has an aggressive mechanism for making sure drug manufacturers complied with negotiated prices. And if they didn’t, the government would slap the companies with an escalating tax that would ultimately reach 95 percent of sales. The criticism from pharmaceutical companies, then, was that this wasn’t much of a negotiation at all, but instead the government setting rates at gunpoint. They further explained, as they often do, that these funds would severely hamper pharmaceutical innovation.
Their lobbying efforts got somewhere. Three moderate members of the committee—California Rep. Scott Peters, Oregon Rep. Kurt Schrader, and New York Rep. Kathleen Rice—announced that even though they had voted for this idea in 2019, they had since changed their minds, and now had grave concerns about pharmaceutical innovation. (It is also worth noting that Peters, in particular, has accumulated sizable donations from the pharmaceutical industry this year.)
https://slate.com/news-and-politics/2021/09/house-democrats-prescription-drugs-pharma-committee-budget.amp?__twitter_impression=true
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