Alexander: Health Committee Explores Practical Solutions to Make Biomedical Miracles More Affordable

“The system is extremely complex and there are many factors that could have caused Joseph, who wrote the constituent letter I mentioned, to be charged $150 for his prescription – for example, what type of insurance plan did his family have? Is it a prescription drug where there is only one manufacturer? Is it a new drug with no generic substitute available?”

WASHINGTON, DC, December 12, 2017 –Senate health committee chairman Lamar Alexander (R-Tenn.) today said Congress is working to find solutions to help Tennesseans who cannot afford their prescriptions.

Alexander said: “I recently received a letter from Joseph in Cordova, Tennessee. He wrote, ‘Senator Alexander, I just got back from a trip to my local pharmacy. Unfortunately, I was unable to purchase some of the medicine my family needs because one of the medications was $150...I want to know how you plan to get this problem under control.’ I know that every member of this committee has heard similar stories from their constituents.”

Today’s hearing was the third in a series of bipartisan hearings on drug pricing. Today’s focus was to examine a National Academies report on the price Americans pay for their prescription drugs.

“According to the National Academies report, about 10 percent of health care expenditures is on prescription drugs – 17 percent, if you include prescription drugs received in hospitals and at the doctor’s office. Like most elements in our health care system, spending on prescription drugs increases every year, sometimes by as little as 1.3 percent, as in 2016, and other years by as much as 12.4 percent, as in 2014. Big increases in spending may be driven by the introduction of a new and lifesaving drug, such as the Hepatitis C treatment introduced in 2014.”

“But there can be differences between what the overall increase on spending on prescription drugs is in any given year and what a patient spends on his prescription when he goes to fill it. The system is extremely complex and there are many factors that could have caused Joseph, who wrote the constituent letter I mentioned, to be charged $150 for his prescription – for example, what type of insurance plan did his family have? Is it a prescription drug where there is only one manufacturer? Is it a new drug with no generic substitute available? What is the list price of the drug established by the manufacturer and what is actual net price of that drug after all of the negotiations and rebates?”

“I think it is important to hear about the National Academies work on prescription drug prices as we work to find reasonable solutions for people like Joseph. These are thoughtful recommendations from the National Academies that deserve careful analysis and I am sure there will be a vigorous debate before Congress comes to any conclusions.”

This is the committee’s third hearing on the cost of prescription drugs this year. The first hearing in June examined the path a prescription drug approved by the Food and Drug Administration takes from the manufacturer to patient, and how this path affects what the patient pays. At a second hearing in October, the committee heard from industry experts on what goes into the price Americans pay when picking up their prescriptions.

Alexander’s full prepared remarks are available here. 

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