▶ 0:17:04Chair Cassidy: The senate committee on health, education, labor, and pensions welcomed come to order. -- and pensions will come to order. They are struggling on how they pay for gas, groceries, and health care. And some things that I see, health care is more than the other two.
▶ 0:17:30Chair Cassidy: My experience as a physician working in a hospital for the uninsured and underinsured brings back those memories of people struggling to pay for that which they otherwise couldn't. To that end I announce the health care affordability plan earlier this week focused on making health care less expensive. The m.v.p. Plan, money in advance to bring power to patients, but there is a real urgency.
▶ 0:17:59Chair Cassidy: The focus of this hearing is how do we make prescription drugs affordable to the american family. Let's start with what works. Generics. About 90% of all drugs dispensed in the U.S. are generics and they are affordable. In 2024, generics generated roughly 450 billion dollars in savings. No other country has a generic system that works as well as ours. No other system develops as many new cheers as the U.S.. The cures can be expensive. And to stretch beyond the budget of many families.
▶ 0:18:27Chair Cassidy: Our goal should be to get these cures into a generic competition faster in a way that preserves the incentive for the next year to be developed. Many of today's most innovative cures are biologics rather than traditional drugs. They have their own generic equivalent called biosimilar. They are more complex and more expensive.
▶ 0:18:54Chair Cassidy: Not as simple as your blood pressure or high cholesterol drug but life-changing. While biologics only account for about 5% of all prescription drugs in the U.S., that 5% makes up almost half of all prescription drug spending, and that is what is driving costs. We need to find a way that supports innovation and protects patients from unreasonably high prices, and both are possible.
▶ 0:19:19Chair Cassidy: My goal is to take the lessons learned from generics and apply it to the biosimilars market to bring down the price of these biologics for americans. We created the regulatory framework for biosimilars before we even have one on the market. The first biosimilar was approved in the U.S. in 2015, five years after the law passed. It is time for us to update that law. It is a complicated market. It has many competing factors.
▶ 0:19:47Chair Cassidy: We need to get patients what they need at the lowest possible price. This committee has taken steps to make generics and biosimilars less expensive. The ensuring timely access to generics act, the biosimilar red tape elimination act are great bills that I'm working to make into law. We need a free market approach. Ranking member sanders will speak but suggest undermining the free market by eliminating patent protections.
▶ 0:20:15Chair Cassidy: But intellectual property protection incentivizes and rewards ingenuity and drives the work needed to find treatments and cures. Government overreach will harm americans in the long run. When I was a doctor in l.a., 26 years old, and all of those 26-year-old men were dying from hiv before we had a cure, it was the ability to innovate that broad cures.
▶ 0:20:44Chair Cassidy: And people -- once the cures became available, a diagnosis which had been a death sentence no longer was and people live long, full lives. I have seen personally in my practice the necessity and power of innovation. Now, it is true that a lot of the research on prescription drugs is done by the nih, but in most cases this is basic research.
▶ 0:21:13Chair Cassidy: The pharmaceutical companies are the ones identifying practical applications for the research and doing clinical trials. Crediting the nih for developing prescription drugs is like saying that the defense department supported the creation of the internet, therefore they created amazon. No, jeff bezos, an innovator, created amazon.
▶ 0:21:36Chair Cassidy: Republicans oppose eliminating patents, intellectual property is key to incentivizing innovation. Therefore, having these life-changing treatments. The fda has taken recent steps to streamline regulatory requirements and incentivize biosimilar drug development. The changes to guidelines are estimated to reduce the costs of certain studies by up to 50%, which decreases the cost for the developer, and therefore for the patient.
▶ 0:22:06Chair Cassidy: On note, this isn't the only way that republicans and president trump are working to lower costs. Earlier this year president trump signed a pbm reform act which we negotiated together on this committee into law to increase transparency into prescription drug transactions and crack down on the middlemen profiting from our purchases of these drugs. We are taking the right steps. The trump administration is doing their job. This committee has worked together to define solutions. We need to keep doing so.
▶ 0:22:37Chair Cassidy: I think the witnesses for being here and look forward to speaking with you all as to how we can support the administration's efforts to lower drug prices and make health care more affordable for american families. I recognize senator sanders.
▶ 0:22:52Sen. Sanders: Thank you for holding a hearing in which -- on a subject that the american people feel very, very strongly about. Bottom line is, ordinary americans understand that the cost of prescription drugs is outrageous, as you've indicated. In many cases, unaffordable.
▶ 0:23:11Sen. Sanders: As part of a very broken and dysfunctional health care system we have the insane situation that one out of four americans will have a prescription written for them by their doctor and cannot afford to fill that prescription. How crazy is that? They get sicker and sicker. They end up in the hospital. A huge expense for the entire health care system.
▶ 0:23:32Sen. Sanders: Chairman, according to a poll conducted last month by the kaiser family foundation, 82% of americans believe that the cost of prescription drugs is unreasonable. 72% believe that the federal government is not doing enough to regulate drug prices. Yet, despite those poles, president trump has claimed, over and over again, that he has already solved the problem. I don't even know why we are holding the steering. President trump has solved the problem. How wonderful is that?
▶ 0:24:03Sen. Sanders: In his state of the union speech in february, president trump said, "I took prescription drugs, a very big part of health care, from the highest price in the entire world to the lowest." hey come americans. There we go. We are now paying the lowest price in the world for prescription drugs. Anyone believe that? I didn't think so. Mr. chairman, if that was true, it would really be incredible.
▶ 0:24:30Sen. Sanders: If president trump lower the costs of prescription drugs, as he indicated, by 1300%. That means that when you go to the drugstore not only do not have to pay anything, the pharmacist gives you money in return. How fortunate is that? Millions of people walking into drugstores and pharmacists giving the money because it doesn't cost anything anymore.
▶ 0:24:53Sen. Sanders: Unfortunately, anyone who has taken a recent trip to the pharmacy counter understands that what president trump has said has, surprise, surprise, no basis in reality. The facts, the american people continue to pay by far the highest prices in the world for prescription drugs. That was true before president trump was president. In most cases it is even more accurate today. With few exceptions, prescription drug prices have gone up, not down, since trump was elected.
▶ 0:25:24Sen. Sanders: The first weeks of this year the pharmaceutical industry raised the price more than 870 prescription drugs in our country. According to a report that I released this morning, 16 pharmaceutical companies that signed so-called most favored nation deals with the president raised the price of more than 270 of their prescription drugs in the U.S. those price increases took place after the companies made those deals with the president.
▶ 0:25:55Sen. Sanders: 2024, the 16 drug companies made $107 billion in profit. Last year the same companies made 177 billion dollars in profits. A few examples. Since president trump took office in january of 20 25, bristol-myers squibb raised the price of its cancer drug by more than $10,000. Merk raised the price of its cancer drug by more than 12,000 dollars.
▶ 0:26:23Sen. Sanders: All of these price increases took place after president trump took office. All of these prescription drugs cost far more -- far less in europe, canada, and japan than in the united states. The bottom line is it doesn't have to be this way. We don't have to continue paying, by far, the highest prices in the world for prescription drugs. That is why I have introduced legislation to cut the price of prescription drugs in america but more than 50% -- by more than 50%. How do we do that?
▶ 0:26:54Sen. Sanders: Preventing the industry for charging more in the usa and canada, britain, germany, france, and japan. Researchers at the yale school of public health estimated this legislation would save the american people $184 billion every year. Mr. chairman, I would ask unanimous consent to include that study and the letter from yell researchers into the record.
▶ 0:27:17Chair Cassidy: Without objection.
▶ 0:27:19Sen. Sanders: This is an interesting point, Mr. chairman. What we are proposing, for real, is what trump has talked about. The basic concept is not a bad concept. Let's look at what is going on in the rest of the world and let's not pay any more than other countries are paying. That is essentially what we are doing in this legislation. People are sympathetic to the concept of what trump is talking about. They should be supportive of what we are doing.
▶ 0:27:50Sen. Sanders: The question I think the american people are asking, Mr. chairman, is, why do we pay such a high price for prescription drugs? I think that the answer isn't complicated. It deals with corrupt campaign-finance system, huge amounts of money that the pharmaceutical company puts into campaigns. By the way, they are very bipartisan. Republicans and democrats, the enormous number of lobbyists they have here on capitol hill.
▶ 0:28:18Sen. Sanders: If people can't believe this, there are 1800 well-paid lobbyists including the former congressional leaders of both major political parties, working for the pharmaceutical industry. Over three lobbyists for every member of congress. Three lobbyists for every member of congress. That, my fellow americans, is why you pay the highest price in the world for prescription drugs.
▶ 0:28:45Sen. Sanders: Let me conclude by saying we have made in recent years some progress. Under the inflation reduction act for the first time in history medicare cut the price of 10 prescription drugs between 38% and 79%. Seniors with the diabetes are now paying no more than $35 a month for insulin, $2000 a year out of their own pockets for prescription drugs. We have made some modest progress. We have a long way to go. Thank you, Mr. chairman.
▶ 0:29:16Chair Cassidy: Thank you, ranking member. This is a hearing about generic drugs, which we have done a lot to lower the cost. Let's have our witnesses speak. We are joined today by Dr. brian miller, a practicing physician, associate professor of medicine at johns hopkins. Dr. miller served as a visiting fellow at the hoover institution of stamford where his work focused on fda regulatory policy and medicare payment policy.
▶ 0:29:43Chair Cassidy: He has held roles across several federal agencies, including cms, fda, ftc, fcc. At fda, Dr. miller was one of two physician reviewers responsible for the approval of a first in class breakthrough treatment. He brings first-hand experience to the issues we are discussing as an fda reviewer and health care provider. Thank you, Dr. miller.
▶ 0:30:11Dr. Miller: Chairman cassidy, ranking member sanders, distinguished members of the health committee, thank you for allowing me to share my views on how improving competition can improve drug affordability. As a practicing physician I am here in my personal capacity in my views do not necessarily reflect those of hopkins, hoover, or medpac. Everyone has cited the study from k ff which is on point.
▶ 0:30:38Dr. Miller: Four out of 10 americans have difficulty taking their medications prescribed due to cost. It's a real problem and we need straightforward solutions. To quote my friend, north carolina treasurer, we need lower unit costs without nonsense. Policy has a lot of tools that we can use besides payment to address affordability. Many of these policies, thankfully, our consensus policies within the jurisdiction of this committee.
▶ 0:31:06Dr. Miller: As a former reviewer, I am very aware of how regulation shapes competition and pharmaceutical product markets. Branded products compete on nonprice attributes. Then we have generics and biosimilars which compete on price. I have three areas that I want to share with you today. The first is that we need more biologics drug price competition. I am on the board of the north carolina state health plan and we cover 750,000 state employees, dependents, and retirees.
▶ 0:31:35Dr. Miller: Last year we spent $293 million on biologics. 32% of our net pharmacy spend. That was a 9% increase from the prior year. I think around three times the rate of consumer price inflation. If we look at what is happening in fda product regulation, the fda commissioner Dr.
▶ 0:31:58Dr. Miller: Mccarty has done a great job to begin the process of streamlining unnecessary premarket requirement such as comparative clinical efficacy studies. There are proposed bills in front of the committee, the expedited access to biosimilar act, these are step in the right direction. We have 15 years of experience with biosimilars.
▶ 0:32:22Dr. Miller: We can and should streamline the evidentiary requirements for the biosimilar 351 pathway and finally make it an abbreviated bla pathway similar to the application for generics. This would take and apply it to the biologics market. We would have massive biologics price competition and it would solve the problem of, if you have a chronic disease and do you require a biologic drug you should have cheap drugs as an option.
▶ 0:32:52Dr. Miller: You should it go bankrupt because you have a chronic disease. We know that generics save untold billions every year. We can do even better. One, the citizen petition process is abused by some product manufacturers. We need a better mechanism to address serious petitions and a mechanism for referral to the ftc and doj for consideration of anticompetitive conduct cases.
▶ 0:33:20Dr. Miller: You shouldn't be a bird to include your competitors' shoes to the ground in a race. -- you shouldn't be able to glue your competitors' shoes to the ground in a race. We can expand the prv program, which would be a market driven mechanism to address that. Of course, consumers need more channels. We have otc products, we should have a behind the counter channel to grow the role of the community pharmacist, the united kingdom, australia, and canada all use this.
▶ 0:33:53Dr. Miller: We also -- the third thing that we need to do is modernize evidence generation. Industry has talked about this probably since I was in college. We need to make this happen. Fda drug review -- and I was a drug reviewer, is an artisanal process. You have a few staff who do drug review. The process needs basic algorithms and automation applied for the first level of review so that then the human reviewer can customize the review thereafter. This could massively improve productivity.
▶ 0:34:24Dr. Miller: We also need to do, restructure the centers and push middle-management back to front line review work. With review fees the centers have grown. We need to grow front line, not middle-management. With evidence generation, we need to push clinical trials into the community. There are concerns that clinical trials are expensive and not diverse.
▶ 0:34:48Dr. Miller: If we push that into the community and use of patient-reported outcomes, we can get more diverse clinical trials and a lot lower costs for branded drug development. I think together we can make all drugs cheap again while preserving and strengthening the fda standards of safety and efficacy. There are more details in my written testimony, and I look forward to your questions. Thank you.
▶ 0:35:13Chair Cassidy: Mr. ryan long. Mr. long is the director of the congressional relations and senior research fellow at the paragon health institute, bringing extensive expertise in health policy, particularly fda regulation and health care affordability. He served as the house energy and commerce committee where he was the council and staff director.
▶ 0:35:41Chair Cassidy: He will speak to actionable solutions to improve competition to make drugs more affordable for patients. Mr. long, thank you for being with us.
▶ 0:35:48Mr. Long: Chairman cassidy, ranking member sanders, members of the committee, thank you for the opportunity. I believe in the promise of medical innovation to save and improve lives and the power of competition to lower prices. Every two months I received a biosimilar infusion to manage a chronic condition that has resulted in er visits and hospitalization. Four years ago I lost two family members, one to a rare cancer and another to complications from a rare disease, within a month of each other.
▶ 0:36:19Mr. Long: I understand that we cannot have affordable generics and biosimilars and lest someone first develops of breakthrough treatments that follow and we must preserve the innovation ecosystem while allowing for robust generic and biosimilar competition. Today, I will discuss the progress and cost savings from improving generic drugs and biosimilars and how to build on that work. The role of over-the-counter drugs in increasing affordability. The federal reforms needed to increase a generic drug and biosimilar uptake and reduce cost.
▶ 0:36:49Mr. Long: America is making progress in bringing generic drugs and biosimilars to market. Chairman cassidy said that generics account for 90% of all prescriptions filled in the U.S., the highest rate in the world. The fda has approved 90 biosimilars since 2015. I want to commend the fda for its work and further streamlining biosimilar approvals. Dr. miller mentioned in 2020 for the fda proposed switching studies is no longer necessary for an interchangeability designation.
▶ 0:37:20Mr. Long: 2025, the fda eliminated efficacy study requirements. The fda said that this shaved three to four years off of the approval process. These are reforms that congress should consider codifying. With the success of getting more generics and biosimilars to market, we are seeing more competition, options, and savings. Even though 90% of all prescriptions in america are generics, they represent 12% of total drug spending. The U.S. generic prices are now 33% below the oecd median.
▶ 0:37:54Mr. Long: The expanding biosimilar market is also bringing savings. According to a 2024 report, savings from biosimilar use increased to $12.4 billion in 2023 alone. Together, generics and biosimilars save the U.S. health care system more than $3 trillion in the last decade.
▶ 0:38:12Mr. Long: According to an hhs analysis of 2020 three medicare claims data, for the eight biologic subjects to biosimilar competition in medicare part b, spending on those specific drugs was approximately 62% lower than it would have been absent the biosimilar. Despite the progress in physician-administered drugs, biosimilar uptake in the medicare part d program remains disappointing. The primary reason is the rebate trap. To gain formulary access, manufacturers must offer large rebates to pbm's.
▶ 0:38:42Mr. Long: A biosimilar with a generally low list price cannot generate a big enough rebate to compete for preferred status against a high price biologic offering rebates 60% or 70%. A good example is the launch of the insulin product. At first, they offered a steep discount. Pbm's refused formulary access. They were forced to offer two versions of the same product.
▶ 0:39:10Mr. Long: One with a list price that was nearly tripled the lower price product to generate specific rebate capacity. In an important step that consolidated appropriations act mandated that pbm's compensation be delinked from drug list prices. More transparency for sponsors, and 100% of rebate and fees to be passed through the sponsors. These are going in the right direction.
▶ 0:39:38Mr. Long: Although not in the committee's jurisdiction there are reforms that we can make to the co-pay structure in medicare part d that can increase generic utilization providing savings to the federal government and importantly to seniors out-of-pocket costs. I want to highlight the opportunity reduce cost to over-the-counter products, which have save the health care system 170 6 billion dollars annually.
▶ 0:40:04Mr. Long: The fbi's additional conditions for nonprescription use pathway -- fda's additional conditions for nonprescription use pathway. Each successful otc transition eliminates unnecessary physician visits, creates market competition, and lowers cost for consumers. I want to address the 340b drug discount program that has grown from a $4 billion program in annual discounted purchases in 2009 to more than $80 billion in 2024.
▶ 0:40:35Mr. Long: The program buy low and sell high incentivize is more expensive drugs rather than generics or biosimilars because the spread is larger with high-priced products. A study found 340b eligibility was associated with a 22 point 9% reduction in biosimilar adoption. In reform that leaves the spread in place won't fix the program's fundamental distortions.
▶ 0:41:02Mr. Long: It should be replaced with a direct financial assistance program based on demonstrated need, like payer mix and uncompensated care burden, not on the ability to exclude drug pricing differentials which will always advantage wealthier institutions at the expense of true safety net providers that the program is meant to serve.
▶ 0:41:23Mr. Long: In closing, policymakers should consider codifying the fda biosimilar streamlining reforms, address the rebate trap, support otc products, and reform 340b in a program that advantage is wealthier hospitals over struggling safety net and rural hospitals. Investment in competition made america the global leader in innovation. With the right reforms and incentives we will continue to lower drug costs while preserving the innovation ecosystem that gives patients and family soap you.
▶ 0:41:54Mr. Long: -- families hope.
▶ 0:41:56Chair Cassidy: Senator sanders will introduce the democratic witness.
▶ 0:42:00Sen. Sanders: I would like to introduce robert weissman, copresident of public citizen, a national nonconsumer advocacy organization since 2009. He is a leading national expert on corporate and government accountability. Thank you for being with us.
▶ 0:42:21Mr. Weissman: Thank you very much, senator sanders, senator cassidy. Thank you for convening this hearing and your thoughtful approach to these issues. I want to begin my testimony with my conclusion. The pharmaceutical pricing and development system in this country is broken. It benefits big pharma at the expense of all of us. It leaves americans sicker, in financial jeopardy, and taxpayers paying far too much.
▶ 0:42:50Mr. Weissman: It's the case that market principles can drive us to solutions, but we need bold solutions commiserate with the scale of the problem. I think that one of those solutions is the prescription drug price relief act that senator sanders has introduced. Let me begin by explaining, quickly, highlighting, how badly the system is broken. 40% of americans ration their prescription drugs because they cost too much.
▶ 0:43:20Mr. Weissman: That is a disgrace, outrage, and inexcusable in this country. The median price of drugs has risen from $2000 in 2008 to $370,000 in 2024. The big pharma companies are making out recording more than 400 billion dollars in profits over the last three years. The ceos make more than $300 million in profits for the top 20 companies and this is unnecessary.
▶ 0:43:50Mr. Weissman: We know this because other countries pay less. Americans pay three to four times more for pharmaceutical brand products then do their peers in other countries. The second point, big pharma benefits from market failures. In fact, it has adopted, imposed, and protects market failures in the industry. Begin with the area of subsidies. It's a great thing that america spends almost $50 billion a year at nih.
▶ 0:44:23Mr. Weissman: It's a great thing that nih is responsible for almost every single product launch in part. But we demanded nothing in return. We confer on the industry 20 year patent monopolies and other exclusivities. Those are not free-market devices they are monopoly devices. We prohibit the world's largest purchaser of drugs, medicare with few exceptions, from negotiating prices, undermining their ability to engage as a market participant.
▶ 0:44:53Mr. Weissman: The trump administration, third point, has recognized these problems but failed to address them. Trump rx is nothing more than a failed website. 40% of the products are generics. Generally, people would be worse off using trump rx than their own insurance. The administration's deal has not brought down prices. The industry isn't worried about them. We don't know the details.
▶ 0:45:22Mr. Weissman: My organization, public citizen, suited the administration to enforce foia requests to get access to these deals so that we can know what is allegedly being done to benefit american consumers. So, fourth, what we need to do is to adopt profound systemic reform. We can in fact leverage market forces to drive down prices.
▶ 0:45:46Mr. Weissman: The prescription drug price relief act that senator sanders introduced, would adopt the principle that donald trump has rightly embraced. That americans should not pay more for drugs than patients and governments in other countries. It would then enforce that true mfn principle saying if an original manufacturer's charges more here we will introduce generic competition.
▶ 0:46:14Mr. Weissman: We will unleash market forces that will come in fact, drive down prices. Dramatic savings are available to do that, if we do that. $184 billion every year according to yale university analysts. $184 billion every year. More affordable for patients, it will save medicare and government payers dramatically, lower charges for the insurance industry.
▶ 0:46:43Mr. Weissman: We can do similar things if we intensify and expand the power of medicare to engage in price negotiation by eliminating delay periods and generalizing the lower prices to the private market. Let me conclude, Mr. chair, by saying what we need to deal with serious problems are deep, serious, bold solutions.
▶ 0:47:15Mr. Weissman: We have the policy tools available to address the inequities in this market and rain in big pharma. -- reign in big pharma. The only question is if we have the political will.
▶ 0:47:27Chair Cassidy: I will begin with questions. Dr. miller, you have spoken about your idea to create an abbreviated review pathway for biologics. How does this idea go beyond other proposals to streamline biosimilar regulation?
▶ 0:47:44Dr. Miller: Thank you. The fda currently has a litany of requirements for biosimilar to get to market. If we streamline that and require purely pharma genetic studies to get to market and give the fda discretionary authority to require additional studies if needed --
▶ 0:48:06Chair Cassidy: You don't have to show that efficacy is assumed and safety is assumed.
▶ 0:48:12Dr. Miller: Correct. In the end of pathway you show bioequivalence. The time and cost to get to market now is about nine years.
▶ 0:48:26Chair Cassidy: Real world experience that biosimilars can be assumed to be a safe and as effective as the innovator drugs?
▶ 0:48:31Dr. Miller: We have 15 years of showing that no biosimilars less effective than the originator product. It may be effective.
▶ 0:48:45Chair Cassidy: On generic drugs if I am writing a prescription if I write name brand and I want the pharmacist to do namebrand I check a box. If I do not check the box the pharmacist has the ability to substitute. What about that for the biosimilars and innovator drugs?
▶ 0:49:06Dr. Miller: We should do that because there will be a small percentage of patients who need the originator product.
▶ 0:49:12Chair Cassidy: You have spoken of the difference in class. You can substitute for an innovator but you suggest we can substitute one biosimilar for another biosimilar?
▶ 0:49:25Dr. Miller: Correct, if we want the full benefits of competition.
▶ 0:49:30Chair Cassidy: Mr. long, you make the point of the current rebate system encourages the person prescribing the drug to use the more expensive drugs because they get the rebate as opposed to the less expensive drug which would be less expensive to the patient. I want to highlight that. I've got that correct?
▶ 0:49:52Mr. Long: Correct, senator.
▶ 0:49:55Chair Cassidy: Under the transparency legislation that president trump just signed into law that was negotiated by the committee members here, what impact will that have upon the? At?
▶ 0:50:08Mr. Long: A couple. It will delink in the medicare part d program the compensation that the pbm gets from the price of the drug. So, they no longer get a larger -- more compensation for higher priced drug. The other thing it will provide us more transparency to the sponsors so they could know what they are paying for. Prior to the law, pbm's would say that a lot of that is confidential information.
▶ 0:50:37Mr. Long: Even if you are the sponsor of a plan you couldn't get that information from the pbm.
▶ 0:50:43Chair Cassidy: So, that transparency is essential. Let me ask you this. Senator sanders has proposed to waive intellectual property rights in order to further lower the cost of medications. Does that have potential to backfire upon patients where it is neutral and we should be blasé about it?
▶ 0:51:04Mr. Long: Some of the numbers used, they were using the list price of the drug, which I think demonstrates the distortions that we have in the market. If you look at the price --
▶ 0:51:14Chair Cassidy: List price is before the rebate?
▶ 0:51:18Mr. Long: Before the rebate, but usually the price that is publicized in the press. That was part of the senator's report. That is not actually what insurers pay. If we opened up the system more to direct consumer purchasing, there would be lower costs there as well. There are trade-offs to any policy. We can certainly lower prices. We can lower them quickly.
▶ 0:51:43Mr. Long: If we did, we are going to jeopardize that future cure, future treatment that you mentioned when you were a doctor in l.a. That may not present itself if we go to that kind of system.
▶ 0:51:55Chair Cassidy: Dr. miller, any comments?
▶ 0:51:58Dr. Miller: I agree more transparency would be helpful. As someone who is a state board member, pbm's are a challenge.
▶ 0:52:08Chair Cassidy: You talked about a new method for accessing drugs between the prescription and over-the-counter. You call it behind the counter. Can you elaborate?
▶ 0:52:23Dr. Miller: Ideally, through fda product regulation, you have a channel where product manufacturers can apply and have a behind the counter channel, where pharmacists dispense short courses of drugs. They could intensify existing therapy. They could initiate new therapy. Extend existing therapy. Then you would have an additional 130 9000 points of access.
▶ 0:52:40Chair Cassidy: This is being done in other countries?
▶ 0:52:43Dr. Miller: Correct.
▶ 0:52:44Chair Cassidy: Senator sanders.
▶ 0:52:48Sen. Sanders: Thank you. Let me begin by trying to set the record straight. President trump said in the state of the union address that quote, he took prescription drugs from the highest price in the entire world to the lowest. End quote. Let me ask our witnesses, do we pay the highest price for prescription drugs or, as president trump said, the lowest.
▶ 0:53:13Mr. Weissman: The highest.
▶ 0:53:15Sen. Sanders: Mr. long?
▶ 0:53:18Mr. Long: I believe it will take time --
▶ 0:53:21Sen. Sanders: Highest or lowest? Trump said we pay the lowest prices in the world. Is that true?
▶ 0:53:27Mr. Long: I don't believe that is true right now --
▶ 0:53:31Sen. Sanders: Dr. miller?
▶ 0:53:34Dr. Miller: The lowest prices for generics.
▶ 0:53:37Sen. Sanders: Do we pay the lowest for prescription drugs?
▶ 0:53:40Dr. Miller: Some drugs yes, some drug no.
▶ 0:53:44Sen. Sanders: The truth is we pay substantially higher prices on average for drugs. Why is that? Briefly explain to the american people what canada does, what europe does so that when americans go abroad they are amazed. They go into the drug store, they pay a fraction of the price that they pay in america. How does that happen?
▶ 0:54:06Mr. Weissman: Other countries realize that although there is a need to support innovation there is a balancing need to make sure that there is access. They don't accept the authority of the pharma to simply leverage its monopoly power to charge whatever they want. That is why prices are lower. It is as simple as that. They don't let big pharma price gouge.
▶ 0:54:28Sen. Sanders: If you are coming up with a new drug, the national health care systems will negotiate a price with you that people can afford.
▶ 0:54:36Mr. Weissman: Exactly right. Recognizing the value of the new drug.
▶ 0:54:43Sen. Sanders: Dr. miller, should the united states government represent the american people and sit down and negotiate with large pharmaceutical company so that the products, often important products, innovative products, are affordable? What is the use of the great drug if no one can afford it? What do you think?
▶ 0:54:59Dr. Miller: I think if we address fda product regulation will lower costs even more.
▶ 0:55:07Mr. Long: I don't think foreign countries pay their fair share of r&d costs.
▶ 0:55:14Sen. Sanders: We might turn that around and say americans are paying far too much to provide huge profits for the drug industry. Mr. weissman, can you say a word about stock buybacks? The theory here is that when we pay very, very high prices, all of that money is going back into cancer research and research for all kinds of terrible diseases.
▶ 0:55:46Sen. Sanders: That is what the drug companies do by charging us high prices?
▶ 0:55:49Mr. Weissman: This meant more on stock buybacks, nonprofits, and then investments in innovation.
▶ 0:55:57Sen. Sanders: Exactly. Mr. weissman, what impact does high prices, high drug prices in this country, have on the health of the american people?
▶ 0:56:15Mr. Weissman: It is terrible and unnecessary. There are important treatments, as many have said, but if they are unaffordable, as you said, they are useless. Some people are rationing their treatment so they are not as effective as they should be. Many are skipping altogether because they cannot afford it and are being denied the care and treatment they need. Some people are dying from it. Many are needlessly suffering.
▶ 0:56:42Sen. Sanders: Dr. miller, maybe you can jump in, does it make sense if someone cannot afford a drug that can help them, that they end up in an emergency room or hospital at great expense to the system? Does that vaguely make any sense at all?
▶ 0:56:58Dr. Miller: I agree if you have a prescription and cannot afford to fill it it is like you don't have the prescription.
▶ 0:57:04Sen. Sanders: Exactly. Mr. weissman, we live in congress in the real world. We understand the power of the pharmaceutical industry. To what degree do the lobbyists here on capitol hill representing the big pharma companies, to what degree do campaign contributions play a role in resulting -- for americans to pay the highest prices for prescription drugs?
▶ 0:57:30Mr. Weissman: I think every problem we have discussed, all of the panelists, are entirely due to the improper or excessive political power of big pharma. Even the problems in bio similarity or because of the designed in problems that big pharma imposed when we first adopted the system to have biosimilars.
▶ 0:57:50Sen. Sanders: Thank you very much.
▶ 0:57:51Chair Cassidy: Senator collins.
▶ 0:57:54Sen. Collins: , thank you, Mr. chairman. I want to thank you for holding this important hearing. Dr. miller, many mainers with diabetes have struggled to afford the cost of their insulin. In doing so they often stretch out the amount of insulin, not taking the full amount that they need, which jeopardizes their health and lives.
▶ 0:58:23Sen. Collins: I'm thinking, in particular, in particular come of a young woman from chelsea, maine who ended up in the emergency room in very serious condition because she could not afford to take the full amount of insulin that her physician prescribed.
▶ 0:58:45Sen. Collins: As part of our broader legislation to cap the cost of insulin at $35 a month for those covered by private insurance and the uninsured, senator jeanne shaheen and I also included a provision to create a new, competitive biosimilar pathway at fda, under which biosimilar drugs could achieve an expedited
▶ 0:59:16Sen. Collins: Review. You refer to this concept in your testimony. Can you give us some idea of how long it usually takes a biosimilar to get through the process now? And speak further on the importance of developing an expedited pathway.
▶ 0:59:42Dr. Miller: Your principles are right. All drugs should be cheap. No one is paying $200,000 for a 20-year-old car, a honda civic. That is not a marketplace. Old drugs should be cheap. Insulin is an old drug and should be cheap. Prices should not be a barrier for access to therapy for old drugs. With biosimilars, it takes on average nine years, $300 million.
▶ 1:00:08Dr. Miller: If you are a small molecule generic it could take a couple of years, 250 thousand dollars to $25 million. We need to basically streamline entry requirements. Require pharmacokinetics. With the drug does to the body should be the basic entry requirement. Give the fda the authority to require more or less for products.
▶ 1:00:37Dr. Miller: You will need less evidence for a few products and a little more evidence, then you will have massively lower costs to develop biologics for old biologics and will have a hugely competitive biosimilar marketplace like we have a competitive generic marketplace. Make old drugs cheap again.
▶ 1:00:52Sen. Collins: I want to ask about another reform that senator shaheen and I have been pushing. Who would be against citizens petitions, but, in fact, they have often been used to delay the approval of generic drugs or biosimilars.
▶ 1:01:20Sen. Collins: Could you talk about this anticompetitive process that has good intention but can be misused?
▶ 1:01:39Dr. Miller: Absolutely. The citizen petition process allows anyone to functionally write a letter to the fda asking for review or express a safety or efficacy concern. Sometimes some manufacturers use that to delay entry and gum up the works. There was a case where a company filed 43 citizen petitions to delay entry. That is anticompetitive. The fda should have the authority to dismiss those and we should have a referral channel to the competition authorities, the federal trade commission and department of justice.
▶ 1:02:06Dr. Miller: The fda should regularly refer bad actors to our competition authorities for oversight and enforcement. In fact, we could actually require the fda and ftc the file an annual report about anticompetitive abuses of the fda regulatory process. At 100% agree with you.
▶ 1:02:24Sen. Collins: Mr. long, very quickly because I am almost out of time, you talked about two versions of a biosimilar insulin being proposed or launched.
▶ 1:02:41Sen. Collins: I remember well the higher cost of biosimilar was picked up by the pew bms, put on the formularies -- by the pbms, put on the formularies, and the cheaper identical version was not.
▶ 1:03:00Sen. Collins: We took care of some of those provisions working together on pbm reforms that have now been signed into law, but is there more we should be doing to prevent -- to ensure that they reach the market and that we don't have these perverse disincentives that cause the higher cost identical drug to be
▶ 1:03:31Sen. Collins: Chosen for the formulary rather than the lower cost drug?
▶ 1:03:35Mr. Long: Thank you, senator. One, we need to look at the 340b program because those inherent distortions are magnified in that program where entities are incentivized to use higher price drugs and not biosimilars. On the formulary side, looking at some of the ftc settlement with express scripts, particularly in this area where one provision was to say that if you have a low cost product and high-cost product, then you had to have both of them on the formulary, at least at the same tier.
▶ 1:04:04Mr. Long: I think that is something congress should look at.
▶ 1:04:07Chair Cassidy: Senator baldwin.
▶ 1:04:10Sen. Baldwin: Thank you, Mr. chairman. When I travel around my home state of wisconsin the overwhelming concern that I hear is about the high cost of health care and affordability issues in particular and in general. My constituents cannot afford individual health insurance coverage policies in the wake of republicans sabotage of the affordable care act.
▶ 1:04:34Sen. Baldwin: They are very afraid that they may lose their medicaid due to cuts and the republicans' big, ugly bill. They are also struggling to pay for their prescription drugs, while pharmaceutical manufacturers continue to raise prices and rake in enormous profits. Americans pay the highest prices for prescription drugs in the world. This is unacceptable.
▶ 1:05:00Sen. Baldwin: I've long called for increased transparency throughout the health care system, not just this area. Throughout. So we can understand with granularity where the money goes.
▶ 1:05:15Sen. Baldwin: My fair drug pricing act, which passed this committee with bipartisan support last congress, would bring basic transparency to the prescription market by requiring manufacturers to justify the exorbitant prices that they charge working families. For the first time, the public would have advanced notice of proposed price increases and more granular information about how these drug prices are determined. Mr.
▶ 1:05:43Sen. Baldwin: Weissman, how would transparency efforts like the fair drug pricing act hold pharmaceutical manufacturers accountable for the unaffordable prescription drug prices that we are seeing?
▶ 1:05:59Mr. Weissman: Thank you and thank you for your leadership in that area. It's an important tool and a market-based tool. We can't have functioning markets without transparency. One way the big pharma exerts its undue authority is by hiding prices, charging people different things, using elaborate schemes -- like these rebate systems.
▶ 1:06:20Mr. Weissman: I will also say that this is further entrenched in the president's mfn deals allegedly negotiated discount deals for americans but we have no idea what is in them. That secrecy only benefits big pharma and hurts the rest of us. We need single prices. There's no reason for differential prices for anybody. Maybe there should be discounts for poor people. That can be through government subsidy but the price of the drug should be the price of the drug.
▶ 1:06:48Sen. Baldwin: I look forward to working with my colleagues to increase the transparency and we welcome any republican colleagues to join me in working on the fair drug pricing act moving forward. Over one million fewer americans enrolled in health insurance through the affordable care act this year, including about 22,000 fewer wisconsinites.
▶ 1:07:19Sen. Baldwin: For those who were able to keep their insurance, they faced doubled, tripled, or quadrupled premiums. I continue to hear concerns expressed that the number of uninsured wisconsinites will only increase as the year goes on.
▶ 1:07:35Sen. Baldwin: Due to the republican cuts to health care in their big, ugly bill, 50 million people are expected to lose their health insurance coverage, -- 15 million people are expected to lose their health insurance coverage. If there proposed rule to make changes to the affordable care act marketplace next year is finalized, cms estimates 2 million people will lose their coverage.
▶ 1:08:09Sen. Baldwin: About 75% of uninsured americans say they are concerned about affording prescription drugs in the vast majority of insured americans say exactly the same thing. How will increasing prescription drug costs paired with skyrocketing health insurance costs and coverage losses affect families' abilities to access the medications they need? This is for you, Mr. weissman.
▶ 1:08:39Mr. Weissman: The best case scenario is families will be financially stressed and put into bankruptcy. The more likely generalized scenarios people won't get the treatments full stop. They will not get treated, they will stay sick, some of them will die.
▶ 1:08:56Chair Cassidy: Senator marshall.
▶ 1:09:00Sen. Marshall: Thank you, Mr. chairman at welcome to our guests. I know in the audience we have some of my community pharmacists from back home and I bet some of you are community pharmacists have been in to see you as well. I've never met a finer profession. So many rural towns in kansas, they are the last health care professional standing.
▶ 1:09:23Sen. Marshall: The pbm's are running them out of town, breaking them financially, often times clawing back more money than the pharmacist is able to stock the medicine for. In our appropriations bill on a bipartisan basis we nipped at the edges of pbm reform. There is still much to be done. One thing my pharmacist brought to my attention is the relationship between tricare and express scripts.
▶ 1:09:53Sen. Marshall: I don't know how long they've had that contract. Maybe since the early 2000's, I suppose. Mr. long, with an audit be helpful? Should it be demanded of tricare? I can't imagine the money we are wasting. What my veterans tell me as they get a 90 day supply of a medicine -- a brand-new medicine. Maybe -- any concerns, any advantages of an audit on tricare and express scripts?
▶ 1:10:23Dr. Miller: I don't know that there can ever be a disadvantage to an audit. I think transparency is a good thing no matter the course or the event, .
▶ 1:10:34Sen. Marshall: I don't know if we ask our inspector general at hhs or the v.a., but I hope this committee would get behind that in some way somehow as well. Dr. miller next. Certainly the people that struggle to get their drugs approved blow up my office, but then I dig down with the fda and they are approved in record numbers. They are doing more with less.
▶ 1:11:07Sen. Marshall: Are you aware of any data points or how the fda is doing compared to previous administrations on approving drugs?
▶ 1:11:13Dr. Miller: I think the fda has worked to accelerate the review process and make it more efficient. My position is, we can take that and do even more. If you look at it in the office of new drugs there are around 340 drug reviewers and something like 6000 people in the center for drug evaluation and research. 12 major super offices. Two of them are primarily involved in drug reviews. Some of the others support. There is a lot of bureaucracy.
▶ 1:11:43Sen. Marshall: What keeps that from happening? It was a problem nine years ago. The swamp, the bureaucracy, law changes? What can we do to make bio similars more efficient?
▶ 1:11:59Dr. Miller: Updating 351[k] to make it more like an anda. Oversight of the fda and a very in the weeds detail of how they structure a new product review, we can use that to restructure drug review and strengthen the standards for safety and efficacy, while lowering the cost of market entry.
▶ 1:12:26Sen. Marshall: Coming back to you to talk about biosimilars and pv ends, but I think it's important to look at the big picture -- and pvm's, but I think it's important to look at the big picture. Americans spend 75% on chronic diseases, 75% of their money on chronic diseases. The number one thing that we can do to drive down the cost of prescription drugs is to have a healthier america. Right?
▶ 1:12:53Sen. Marshall: We spend all of our time nipping at the edges of drug prices, but we need to have -- we need to continue to have a focus on making america healthy again. I think that we have to acknowledge that prescription drugs, to some extent, to a large extent, keep people out of emergency rooms in hospitals, so there is value in those drugs. If you want me to save medicare, I need an alzheimer's drug to start with.
▶ 1:13:19Sen. Marshall: I think that we have responsibilities as people across america. Rather than expecting congress to fix this all the time. But I want to talk about biosimilars and pbm's and what my pharmacists have told me is that they have to raise the prices on biosimilars to be able to gain access to the formularies. Talk to me about that game that the pbm's are doing for formulary access for biosimilars if you can.
▶ 1:13:48Mr. Long: In my testimony I mentioned the viatris insulin and humira. The insulin example, in 2020 they had a biosimilar and could not get on formularies. 20 21 they got an interchangeable biosimilar approved and they had to launch two different products with the same drug, same biologic.
▶ 1:14:17Mr. Long: One with a list price that was triple the price that someone could go into a pharmacy and get. That was in order to provide rebates to get on formulary.
▶ 1:14:24Sen. Marshall: To some that up, the problem is the higher the cost of the drug of the more money that the pbm makes. That is why we need to delink those two to win this ballgame.
▶ 1:14:36Mr. Long: I think what congress did earlier this year is a great first step.
▶ 1:14:41Sen. Marshall: Thank you so much, chairman.
▶ 1:14:44Chair Cassidy: Sen. hassan: I apu holding this hearing. I was at an independent pharmacy in new hampshire just last week and the pharmacist, it is a family business. His children are taking it over.
▶ 1:15:08Chair Cassidy: He told me patients are in fact rushing out the drugs because they simply cannot afford them. This is a timely and important issue for a lot of different reasons. Mr. long, I want to start with you. We have talked a little bit about the abuse of citizen petition. Big pharma has other techniques.
▶ 1:15:35Chair Cassidy: It blocks lower-cost drugs from entering the market by using frivolous patents and exploiting loopholes to extend patent protections for their medications for years or decades beyond the exclusivity period provided. When companies engage in years of litigation, patients are forced to pay for higher brand-name drugs. How do drugs monopolies raise costs for families and what else can we do in this committee to rein in abusive patent games?
▶ 1:16:04Mr. Long: Thank you, senator. We need to make sure that we don't take away incentives to further innovate on existing products. We don't want to have a product were only do is go to a hospital and get infused. You want to have something that someone can take home. But we need a system that after a certain period of time when you get a return on investment that there is a guarantee that we can have generic or similar competition.
▶ 1:16:36Mr. Long: You have a couple of bills. I think that would be a good first step. We need to make sure confidential information is protected. I think there is also a bill you might have been purple quick listing of exclusivity is. I think your bill goes nearer what was in the house of -- does mirror what was in the house and that makes a lot of sense.
▶ 1:17:00Sen. Hassan: We have a bill that would end one type of loophole through which big pharma companies exploit a lack of coordination between the fda and the patent office. They give details to the fda but not as much to the patent office so they can submit a new application with the particulars they have already given to the fda and gain exclusivity that way. I'm hoping we can move that bill forward. There is another loophole.
▶ 1:17:30Sen. Hassan: The fda does not tell the public when the market exclusivity period expires. That makes it harder for companies to develop alternatives. Senator budd and I are introducing a bill today that would close that loophole which I hope will bring more affordable options to patients quickly. Mr.
▶ 1:17:53Sen. Hassan: Weissman, two years ago gsk pulled one of the most common inhalers for children off the market causing significant harm to young children with asthma, many of whom forced to go without an inhaler. It is a very specific thing. All children cannot use all inhalers. Gsk replaced it with an identical drug that it distributed through a partner company.
▶ 1:18:22Sen. Hassan: Making more money than they did with the original patent. This so-called authorized generic allowed them to continue to profit without having to pay hundreds of billions in rebates that it was owing to the medicare program for raising prices faster than inflation. After I launched an investigation into the actions, the fda approved the first ever generic of flovent last month and families will soon have a lower cost option for kids.
▶ 1:18:54Sen. Hassan: There is still more work to do. Our pharmaceutical companies using authorized generic drugs as a loophole to keep prices high and how do we rein in that practice?
▶ 1:19:03Mr. Weissman: Yes they are. Thank you for your leadership. There is more to do. One intervention would be to prevent the launch of authorized generics during the 180 days to preclude competition from entering. Beyond that we need much more aggressive antitrust enforcement. Your range of questions range is so many ways to gain the system.
▶ 1:19:31Mr. Weissman: We have to deal with all of them but we also need a broad solution that just says when the time is up for your exclusivity, the time is up and also you don't have the right to price gouging even when you have p patents.
▶ 1:19:50Sen. Hassan: Dr. miller, I am interested in the behind the pharmacy concept because pharmacies have a big role to play but how does that actually lower costs?
▶ 1:20:03Dr. Miller: There are a variety of small drugs which are probably more expensive if you buy them through your pbm. It might be a couple of dollars if you get the as cash products. A behind the counter channel would function like an otc channel. Very low price.
▶ 1:20:20Sen. Hassan: Thank you. >> it would eliminate the doctor's visit to get the drug and the doctor's visit is often expensive. Senator who is dead.
▶ 1:20:32Sen. Husted: Thank you for hosting the hearing today. Being one of the newer members in the senate I have watched policy being made from the outside. I know there are well-intentioned efforts. For example since the affordable care act was passed it has become unaffordable.
▶ 1:20:55Sen. Husted: We have seen consolidations of hospitals and prices going up at twice the rate of inflation which have affected families in ohio, small businesses in ohio cannot afford things and it has certainly affected the taxpayers. We are trying to find ways in the prescription drug space because it has certainly affected pharmacies as we have seen small independent pharmacies being squeezed as well.
▶ 1:21:25Sen. Husted: We passed something late last year, senator hassan and I sponsored an act that streamlines efforts for taking prescription drugs and making them over the counter drugs because we know that that reduces the cost to the consumer and we were proud to get that done. Mr.
▶ 1:21:41Sen. Husted: Long I know you have done research that discusses that these moves from prescription to over-the-counter drugs for patients creates savings and I want you to give me more enlightenment on what you think we should do, how we can encourage more of this to happen.
▶ 1:21:59Mr. Long: When it comes to fda regulated products, there are statutory standards but the approvals are subjective. Generics you have to demonstrate bioequivalence but if you look at many other products, there is a standard that is subjective. The biggest impediment is for a developer to know what of the requirements and standards necessary for the fda to make a decision on that product. Four otc products that has been the biggest barrier.
▶ 1:22:28Mr. Long: It has not been the statutory standard. It is what is the fda going to require for me to demonstrate that standard. The smart otc act where a potential developer can ask the fda for a meeting up front to determine what is going to be necessary to demonstrate to the agency is probably the biggest reform that could have been made.
▶ 1:22:49Mr. Long: Moving forward, getting fda to do class-specific guidance on the types of information necessary to support approval is another step forward that needs to be done. I think with the fda's public meeting that they intend to have, that is the beginning of that process.
▶ 1:23:11Sen. Husted: Part of the act requires the fda to sit down with sponsors if requested and focus on the process and discuss the development of the plan that spells out the risks that need to be addressed in the studies. I would just ask you based on your experience how would such alignment reduce the years of back-and-forth required in the regulatory process between the agency and otc sponsors?
▶ 1:23:42Sen. Husted: This something like that helpful?
▶ 1:23:45Mr. Long: Absolutely. Otc drugs are the unsung hero in medical practice. We often take them for granted and they are huge. Think about tylenol, ibuprofen, all of these products. Having a structured fashion which would ask the fda for a meeting, they would have to talk with you about your program is usually helpful. A couple of things to make that better, that process for other product areas can be clunky.
▶ 1:24:18Mr. Long: Having a real-time channel where companies can ask reviewers in real time for advice I think that would be helpful because the reviewer would be the counselor and guide to helping the pharmaceutical company make that product and get that to consumers. I agree with Mr. long. Specific guidance is would be huge. The generics industry has that. On that mailing list I get emails all the time with all of these super nerdy guidances. The otc product space needs that.
▶ 1:24:49Mr. Long: I would say for the additional conditions for nonprescription use which started during the biden administration rulemaking process finished recently during the trump administration, we need guidance for that because then we could get a lot of products for chronic disease into the hands of consumers faster and cheaper.
▶ 1:25:06Sen. Husted: I know I'm out of time. It is estimated that over-the-counter medicines save the united states healthcare system $167 billion annually. The cost of the drug can be 90% cheaper on average. There are so many things that I know. I use the example of a statin.
▶ 1:25:32Sen. Husted: There is no reason that I have to continue to go back and go through that prescription drug process for a low dose of a statin that should be available for a far lower price over-the-counter. That is one of many examples that we need to go faster. Thank you Mr. chairman. Wherever the chairman went. Senator armstrong.
▶ 1:26:03Sen. Husted: >> thank you, Mr. chair. I say that with you all for being here and this is something that senator after senator has reiterated. This is a major cost impact on people in america. Mr.
▶ 1:26:23Sen. Husted: Long, one of the impediments to greater competition that you were discussing is the impact of excessive litigation from manufacturers to stifle the genetic competitors, otherwise bringing lower-cost markets, products to market. I could not agree more.
▶ 1:26:46Sen. Husted: We have a bill, senator collins, senator welch and senator cotton , skinny labels big savings act, that will address this issue. It is going to help make sure that the long-standing provisions are not undermined by the enormous cost of these mountains the litigation.
▶ 1:27:09Sen. Husted: It is going to allow more generic manufacturers to not only develop competitor drugs but ensure that those medications get to the marketplace in a platform or circumstance where they can take that price advantage and save people money. Mr. long do you believe policies like this bill are necessary to ensure that generic competitors have the certainty and credibility that they need to compete in the marketplace?
▶ 1:27:38Mr. Long: Thank you, senator. I am not a lawyer and it is a complex area. The fda does allow for skinny labels and it can facilitate generic entry. Submitting an application should not be considered patent infringement. Under this bill a generic manufacturer is stating it is a matter of fact that they got approved and it is therapeutically equivalent.
▶ 1:28:06Mr. Long: It is incongruous for the government to approve a product but then have a company being sued for patent infringement. I think it is important to ensure that there is the incentive to develop new indications for existing drugs. I think your bill tries to acknowledge that by ensuring that there is a demarcation line between what is promotion of the skinny label.
▶ 1:28:32Sen. Hickenlooper: We want to make sure the incentives are for research and innovation and new drugs. We don't want the incentives to be toward litigation.
▶ 1:28:41Mr. Long: Correct.
▶ 1:28:42Sen. Hickenlooper: Something we all agree on. Mr. weissman, according to a brookings study in the first year of the medicare drug pricing negotiation program the ability to negotiate prices of drugs can save roughly $6 billion to the american people. Next year when medicare can negotiate 15 drugs, savings can be more than $12 billion.
▶ 1:29:11Sen. Hickenlooper: Thanks to the legislation that we passed, the inflation reduction act, these numbers will continue to rise. Mr. weissman, can you help describe the difference in terms of overall impact of a program like medicare drug pricing negotiation which has been signed into law versus executive orders? In the immediate moment but also long-term, do you think executive orders like some of the ones we have seen will have the same lasting impact on reducing drug costs as when we passed laws?
▶ 1:29:42Mr. Weissman: Thank you for the leadership on the skinny drugs issue. There is the obvious point, the civics lesson which are that laws are permanent executive orders. The executive action by this administration is not doing anything whatsoever. There are proclamations about price reductions generated but no evidence of that and no clarity about what is being done including as I mentioned these deals.
▶ 1:30:09Mr. Weissman: Medicare price negotiation by contrast is using medicare's market power, the free market principle to lower prices. We need to build on and expand that medicare negotiation authority so medicare does not have to wait years to begin negotiations. And it should cover all drugs, not just a few. Because we are the taxpayers being ripped off across the board. What started is beginning important process -- progress and we should generalize it.
▶ 1:30:38Sen. Hickenlooper: That has long been an issue of why that is, why we don't allow negotiations to impact that market anymore material way. A quick question, because there is so little transparency with the most favored nation steals, we have no idea of how much that is benefiting as of the state medicaid budgets.
▶ 1:31:09Sen. Hickenlooper: One thing we have tried to get at or the prices including in these deals that states already get through the medicaid program. Again, we don't have the data. I am constantly obsessed with the lack of transparency and the lack of availability of the data on all these things. Just to round it out, do you think that the state medicaid programs, will they be able to benefit from this most favored nation program?
▶ 1:31:40Mr. Weissman: We don't know but little reason to suspect. They already get low price is different than the rest of the country. Analysts are clear, they don't think this will have any impact whatsoever on profitability which suggests we will not really get anything. The first step would be to publish these deals so the american people know.
▶ 1:32:00Sen. Hickenlooper: That is my argument on all these things, more transparency at every turn. Thank you all for being here. I yield back to the chair. >> the red light is on. Thank you. First of all I want to tell you a huge thanks for being here. I have been in your chair a lot more times than I have been in this chair.
▶ 1:32:30Sen. Hickenlooper: I really do appreciate your expertise and it is so critical to get this stuff right as opposed to just generally write. I appreciate the details that you all can bring to us. My question is a little different in that I come from private industry and have seen the impact of the tape that just piles up the cost on the consumer and we do not even know it.
▶ 1:32:57Sen. Hickenlooper: It is just more red tape that prohibits competition and new product from coming to market. If you think about where we are today with a.I. That I will think is a powerful tool in faster development drugs, my question, if you were really thinking about where the puck is going, a lot of folks have been on how bad things are and trying to put patches on things.
▶ 1:33:26Sen. Hickenlooper: I am curious about if we think about where the puck is going, we think about a much faster world of development. It is there a way to integrate the development and approvals and what are some of the more innovative ways you would recommend as we start thinking about faster approvals which, the lower that cost is, the more interest you get, the more new companies, more upstarts that are not having to bear the cost of the approval process for four
▶ 1:33:56Sen. Hickenlooper: Years would mean a lot of difference in terms of bringing down the cost of drugs if we had more competition because of the approval process. I would love to hear from you Dr. miller about where you think the puck is going.
▶ 1:34:09Dr. Miller: There's a lot we can do. Fda should maintain the standard of safety and efficacy but the reviewers in each area sit on top of an industry and they see all the information so the reviewers should be the guide and counselor to industry for getting a good product over the finish line. Part of that is getting rid of the red tape, making that bidirectional channel. Manufacturers and developers can talk with the reviewer.
▶ 1:34:38Dr. Miller: The other thing is helping people think differently about how they generate evidence. Having a patient drive to a clinic trial site for two years, that's expensive for the patient. It is expensive for the manufacturer. Pushing clinical trials into regular community practices, hca, however it is, that is where you want clinical trial to occur. You want it integrated into routine care so the data is easier to get and lower costs.
▶ 1:35:05Dr. Miller: On the fda side, you want the product reviewers not spending their time crunching stuff in excel. The basics should be done and then the reviewer should be doing customized analysis and asking and answering better questions in conjunction with the product developers. There is a lot of money that can be taken out of the system on the development site for creating new drugs.
▶ 1:35:28Sen. Armstrong: Thank you very much.
▶ 1:35:30Mr. Long: 90% of drugs that enter phase I trials do not get approved. It costs $2.6 billion to have a new drug into the market. You have to pay for a lot of failures. If we can use the technology you talked about to better identify drugs and streamlined the actual development process without undermining the standards for approval, that can do a lot to get patients access to drugs quicker and reduce costs. Dr. miller is right.
▶ 1:36:02Mr. Long: Decentralized trials will expand access to experimental medications for people. At the end of the day the biggest thing that can happen for the fda is consistency in the standards and expectations of the person who needs to file the application.
▶ 1:36:15Sen. Armstrong: Thank you.
▶ 1:36:17Mr. Weissman: Thank you, senator. No doctor for me. I appreciate the question. I agree on the importance of speeding up the review process for biosimilars. We should also push, pull back the period of exclusivity. It is too long for the start date of introduction of competition. I want to emphasize if we reduce the cost of development or the regulation, it is not going to translate into lower prices.
▶ 1:36:47Mr. Weissman: High prices are not due to the cost of r&d. They are due to the fact that companies have monopolies and charge what they can. We should do those things to lower price, to lower cost but to lower price we will have to directly intervene in the pricing monopolies of big pharma.
▶ 1:37:03Sen. Armstrong: I would just question if we really could lower the timeframe that it takes for somebody to develop a drug and get it to market, it seems like you could actually start to really chew away at the monopolies because you would open the gates and lower the barriers to entry for smaller companies. I would love to hear why that is not right.
▶ 1:37:26Mr. Weissman: Faster generic entry 100% will lower prices but lowering the development costs for how fast the original manufacturer can get to market will not translate to lower prices because they will still have the monopoly irrespective of how much it costs to develop the drug, they will charge as much as they can, they have made that very clear in recent years.
▶ 1:37:46Mr. Long: I think we talk about generic competition which is important but there is also therapeutic competition which is equally as important. 10 years ago there was a discussion on the cost of a drug that cured hepatitis c. Two competitors came onto the market. They were not generics, they were brands. You saw a rapid decline in the price of the product. I think your comment is true.
▶ 1:38:12Mr. Long: We can the risk the development process and truncate the time to get to market, you can have more therapy in the competition to lower prices.
▶ 1:38:20Sen. Armstrong: Thank you very much. That concludes my questions. Senator alsobrooks.
▶ 1:38:26Sen. Alsobrooks: Thank you so much star witnesses for being here today. Maryland is home to many of our leaders in life sciences who work every day to bring us closer to life-saving cures from pioneering work to develop a vaccine during operation warp speed to groundbreaking t-cell therapy that can cure cancer.
▶ 1:38:52Sen. Alsobrooks: We have made tremendous strides toward the development of treatments and cures including doing what was once thought impossible, curing sickle cell. It takes time and investments to make strides and it is something that I am conscious of as this administration continues to demand massive cuts to nih including at the presidents recent budget proposal for fiscal year 2027. While we don't want to undermine that progress, for so many americans healthcare and drug prices remain unaffordable.
▶ 1:39:23Sen. Alsobrooks: Too many americans are still electing to rash in their prescriptions or fill them or not to fill them all together in order to make ends meet. It is why democrats lead the way by passing the historic inflation reduction act to allow medicare to negotiate drug prices for the very first time and save taxpayers billions of dollars. It is especially frustrating when we see this administration taking credit for that progress with a scam version of a real cost savings plan. My first question to Mr.
▶ 1:39:55Sen. Alsobrooks: Weissman, the president has touted his gimmick website and his deals with pharmaceutical companies as a way for patients to get the "world's lowest prices on prescription drugs." these savings sound good but it is important for americans to understand the truth. Multiple reports have found that trumprx actually serves as an advertisement for expensive brand-name drugs without mentioning more affordable generic drug options that would actually save patients money.
▶ 1:40:26Sen. Alsobrooks: Take albuterol for instance, a critical drug for anyone with asthma. My daughter has used it. If you search rx the website takes you to the brand name product that alleges that trumprx at $156 but it does not mention anything about generic options. Generic albuterol close closer to $40 retail.
▶ 1:40:57Sen. Alsobrooks: The good rx coupon that price is around $42. If you have insurance, you are paying $10 for the inhaler. The president is not saving patients money. He is taking credit for something he had nothing to do with and scamming americans along the way. How might this kind of misinformation from the trumprx website potentially harm consumers?
▶ 1:41:24Mr. Weissman: We just reviewed what is on the trumprx website. There are cheaper options. For the rest of them, people probably can afford if they have insurance a lower price through their insurance program. It is diverting people away from lower cost options.
▶ 1:41:48Mr. Weissman: Mostly it is not doing anything at all because 69 drugs is nothing compared to the overall drug on the market and it is not a serious effort whatsoever to confront the problem of affordability.
▶ 1:41:58Sen. Alsobrooks: Trumprx is essentially costing to some extent people money. We know that the true intent of it is not to bring down costs but it is once again a scam. What would it mean for an asthma patient that was tricked into believing that trumprx albuterol is the most affordable option available? Could it be that they would potentially skip their medication if they think they cannot afford to fill the prescription?
▶ 1:42:27Mr. Weissman: 100%. Either people will not purchase at all and they purchase and not take it as often as they should because they just paid so much out-of-pocket when they could've had a more affordable product even on our existing marketplace.
▶ 1:42:44Sen. Alsobrooks: Like any scam consumers using trumprx should pay attention to the fine print. Trumprx is steering prescience -- patients toward brand-name products. The site lists 80 drugs making up just 2% of all approved medications. Will a program with such a limited scope actually lower prices for americans or do direct customer consumer programs do anything to address long-term costs?
▶ 1:43:12Mr. Weissman: Nothing about this is a serious effort to lower drug prices. The president's right, we should not pay more than other countries do for drugs. But he has done nothing at all to advance that agenda.
▶ 1:43:24Sen. Alsobrooks: Thank you.
▶ 1:43:26Sen. Armstrong: Senator moody.
▶ 1:43:30Sen. Moody: Thank you for convening this hearing. Hearings like this are a good way to bring light to some really complex issues and challenges we are facing and may be counter some false narratives about really good efforts to bring down drug prices. For decades americans have been strained by a broken healthcare system.
▶ 1:43:56Sen. Moody: And that healthcare system seemingly in terms of service and costs for the patients last. A public sentiment of the healthcare system has declined since the pandemic and now according to research over 70% of americans are very concerned with the price of healthcare specifically. I think everyone on the dais would agree that the citizens of the greatest country on earth should not be crushed by medical debt for products and services that other nations pay less for.
▶ 1:44:25Sen. Moody: For decades americans have heard politicians make promises to the american people and I want to offer some quotes. Bill clinton said in 1992 slow price increases for prescription drugs force americans to pay more than europeans or canadians pay for the same drugs. During his tenure as president we experienced the most rapid growth in prescription drug prices in history. By the end of his presidency per capita prescription drug spending had doubled from $306 to 600 $41.
▶ 1:44:56Sen. Moody: George bush said in 2002 while finding legislation, "we will reduce the cost of drugs in america by billions of dollars and ease the financial burning -- financial burden for many seniors.
▶ 1:45:10Sen. Moody: By the end of his tenure, -- barack obama when it came to healthcare in 2008, the new american majority can end the outrage of unaffordable unavailable healthcare and by the end of his presidency not only did per capita drug expenses increased further by the american people were saddled with fraud and the great expense of obamacare.
▶ 1:45:37Sen. Moody: Joe biden said in 2024, "we pay more for prescription drugs than any other major nation on earth. It is wrong and I mending it and I'm going to lower prescription drugs by 60% and that is the truth." the truth, by the end of his presidency per capita drug spending had increased by 20% to $1 unlike those who have preceded him, president trump
▶ 1:46:07Sen. Moody: Has worked outside of the broken system to offer an alternative. No one has tried to do this before. Trumprx was launched two months ago and will increase in availability and additional drugs and now provides access to heavily discounted drugs to americans and they can be delivered to their door.
▶ 1:46:29Sen. Moody: There are 80 drugs on trumprx was totally transparent prices ranging from insulin and chemotherapy to glp-1 weight-loss drugs, hormone replacement therapies. These drugs are available right now during his presidency. He is trying to do something different than those administrations that make promises and never moved the ball. Something different, a market that americans can see what they are paying.
▶ 1:46:59Sen. Moody: They have offered these drugs at massive discounts in 70%, even 90% in some cases. These are brand-name drugs that account for over 80% of total drug spend despite being less than 10% of total volume. I am not sure that another president would have tried to do something like this, at the system that the american people have been saddled with for decades.
▶ 1:47:26Sen. Moody: Under president trump along with secretary kennedy and Dr. oz everyone deserves credit for trying to put americans first and delivering results on some of their promises, actually delivering lower drug costs. Can we get more drugs on there, yes. Can we vary the drugs available? Yes.
▶ 1:47:54Sen. Moody: My guess is this will continue to improve. Of course there are more drugs that we need to get on trumprx but this is a phenomenal start. With that I would like to turn to our witnesses. Mr. miller, I will start with you. Do you believe this new channel of access for consumers or an alternative channel for access for consumers like for those who are uninsured or may have higher deductible plans, can that help wring down drug prices overall per capita?
▶ 1:48:25Dr. Miller: More channels is always good. We need more competition. We also need more competition and access to drugs in a behind the counter drug channel and the trump administration has moved to expand the otc drug class, moving towards more accessibility for lower cost drugs is a huge win for consumers. >> clearly what we have done in the past does not work, we have to try new things.
▶ 1:48:53Dr. Miller: I agree.
▶ 1:49:00Sen. Markey: Thank you. Americans are paying the highest prices in the world for prescription drugs and the situation is getting worse, not better under the trump administration. According to a poll last month 60% of americans say they are worried about being able to pay and afford to pay for their prescription drugs.
▶ 1:49:23Sen. Markey: More than four in 10 adults say they have skipped doses, cutting pills in half or simply not filling the prescription because of cost. One of my constituents from merrimack, massachusetts says "I have ms and the drugs I take for me to live a normal life are very expensive. My prescription costs me $250 per month.
▶ 1:49:51Sen. Markey: Michael pays our hype and I have to put them on a credit card because I cannot afford to pay them. Now my credit card debt keeps going up." this is simply unacceptable. Americans should not have to make impossible choices between their medicine and their groceries. President trump promised to fix this. He has not fixed it. Trump and the republicans have only made healthcare more expensive for millions of americans across the country. Their big ugly bill is taking upwards of 10 million low income people off of medicaid.
▶ 1:50:24Sen. Markey: How are those 10 million people going to afford their blood pressure or arthritis medication when that happens? Trump and republicans refused to extend the aca premium tax credits. We will see millions pay more for their insurance and sign up for cheaper plans with higher out-of-pocket costs or go without coverage altogether. Trump looted healthcare to pay for tax breaks for billionaires. He did not stop there.
▶ 1:50:55Sen. Markey: Trump is piling on with 100% tariffs on imported medications and drug ingredients, tariffs that economists and public health experts broadly agree and passed -- will be passed directly to patients. These tariffs are just another tack on hard-working americans. Mr.
▶ 1:51:13Sen. Markey: Weissman, the trump administration is imposing 100% tariffs on imported drugs as well as drug ingredients even if the drugs themselves are manufactured in the united states. Do you believe tariffs on medications will increase or decrease drug costs for patients in the united states?
▶ 1:51:34Mr. Weissman: They increase them.
▶ 1:51:36Sen. Markey: Why is that?
▶ 1:51:38Mr. Weissman: If you are imposing charges on inputs, it is going to raise the cost of the product. There is another aspect which is we don't know the kind of tariffs will be applied because the companies have made deals with the president, secret deals and they are getting some kind of exemption from the tariffs. This is a very murky area. There is nothing good that can come from these increased tariffs.
▶ 1:52:00Sen. Markey: A study last year found that a potential 25% tariff on pharmaceutical imports could raise U.S. drug costs by $51 billion per year with trump calling for tariffs four times, it seems certain to trigger cascading supply chain disruptions and hike prices for patients at the pharmacy counter. Mr.
▶ 1:52:26Sen. Markey: Weissman, in your professional opinion is it fair to expect that if drug costs increase, american patients will pay some portion of that cost?
▶ 1:52:35Mr. Weissman: Certainly.
▶ 1:52:36Sen. Markey: Turning away from tariffs, we have already seen an attempt by republicans to eliminate the aca's enhanced premium tax credits and cut nearly $1 trillion from medicaid. We have a tsunami of healthcare costs that are descending upon the american people. It is just going to be catastrophic. I just want to give you my remaining 54 seconds Mr.
▶ 1:53:07Sen. Markey: Weissman so you can tell the committee as we are concluding this hearing, what you want us to remember about your testimony.
▶ 1:53:14Mr. Weissman: With regard to the cuts we know it will lead to 50,000 deaths per year because people will not get the care they need. It is going to massively undermine people's financial security as they try to pay for pharmaceuticals that are otherwise unaffordable and many are just going to go without the treatment they need altogether. As an overarching point I would just say we do need bold solutions. Marker proposals cannot help.
▶ 1:53:47Mr. Weissman: The principle that americans should not pay more than other countries is exactly right. We can do that by asserting it and requiring generic competition if manufacturers refuse to make a floor price is available here in the united states.
▶ 1:53:54Sen. Markey: Thank you. >> I yield for five minutes for questions from myself. Mr. long, we have heard over and over from the democrats that the trumprx website is a gimmick. A real attempt to bring down the cost of prescription drugs. Is it a gimmick?
▶ 1:54:14Mr. Long: Thank you, senator. I think complexity in the system is for some design because it allows them to extract value when people do not understand. What trumprx is doing and other direct-to-consumer advertising or direct-to-consumer drug platforms are doing is to try to simplify the system, make it more transparent and take away the various layers that are
▶ 1:54:45Mr. Long: Attracting value without doing anything to promote value for patients. It has been two months. It will get better but as people are able to go to shop transparently whether on trumprx or other direct-to-consumer platforms,. >> so you are saying it is not a gimmick, it is a real attempt to bring down the cost of prescription drugs which is very important to most americans?
▶ 1:55:10Mr. Long: Yes. >> thank you. Dr. miller, drug companies are dependent on china for cheaper trials. Trials are cheaper in china because patients there don't have any rights. How is china not only stealing the intellectual property but moving up the value chain and building their own industry?
▶ 1:55:33Dr. Miller: Thank you for highlighting global competition. China wants to dominate the life sciences industry as part of their five-year plan. They want to spend 2.5% of their gdp on life sciences r&d. They have the thousand talents program to capture her interactional -- capture our intellectual knowledge on people. Clinical trials experimenting on humans in labor camps. We respect human rights.
▶ 1:56:02Dr. Miller: We have standards for safety and efficacy. If we do not modernize fda product review and modernize evidence generation and transition the fda from an artisanal process to a standardized analysis and then customization and the fda as a guide to product developers, we are going to lose american dominance in the life sciences industry to china. >> this is the same industrial policy that china uses to take over so many other markets.
▶ 1:56:33Dr. Miller: Last year 42% of drug licensing deals came from china. What does that drug industry look like in 10 years if we let china continue down that path?
▶ 1:56:42Dr. Miller: China is already working to dominate. In 2020 they had 23 by former ipos. In 2021 they had a $381 billion market cap for their life sciences industry. They will dominate product development, new drug classes, new innovation will come from china. American patients and second followers.
▶ 1:57:06Dr. Miller: They have a supply chain choke-hold on us with the rare earth minerals which the administration is working to break that. We don't want to replicate that in the pharmaceutical industry. >> unpacked at more. What does this mean to our national security? >> if china is at the negotiating table and they control the active pharmaceutical product ingredients for all new drug classes, they can leverage that against us. We have the medicare and medicaid programs.
▶ 1:57:34Dr. Miller: You cannot access a drug if you cannot physically get the drug imported from another country as part of your normal prescribing process. The other thing is this would be devastating economically. The pharmaceutical industry informs -- employ thousands of well-paying jobss and builds a huge industrial technology base. We could lose that. >> what does the fda need to do about it?
▶ 1:58:01Dr. Miller: The fda needs to transition from an artisanal sweater knitting process of product review. They need to use that process and eliminate redtape. >> very helpful. I yield that the rest of my time.
▶ 1:58:23Sen. Kim: Thank you. There has already been a lot of this discussion so I will not belabor the point. When it comes to the role of insurance and accessing healthcare and trumprx, I want to drill down on this further. Mr. weissman, is it true that you still need a prescription written by healthcare provider to purchase a drug on trumprx? >> yes.
▶ 1:58:50Sen. Kim: If you don't have insurance, you still have to pay out-of-pocket to see a healthcare provider to get a prescription. Then you have to pay out-of-pocket for a branded drug. There is no generic on trumprx. I just want to point that out because I feel like I appreciate the desire to try something different.
▶ 1:59:12Sen. Kim: There are so many different issues we are facing when it comes to the cost of prescription medication but I cannot help but feel like we are going about this backwards and we should be working to make coverage more affordable for americans, supporting affordable providers like community health centers as a first step. I look forward to working with my colleagues on this. Mr.
▶ 1:59:33Sen. Kim: Weissman, I wanted to drill down in terms of prioritization in this committee, how important is it that we focus on increasing coverage for affordable healthcare for americans right now?
▶ 1:59:46Mr. Weissman: Unfortunately we have marched in the wrong direction in a massive wave with the cost of medicaid. First and foremost it will take care away from 15 million americans. The additional cuts that are making things too expensive and costing millions more for the affordable exchange act cuts. They will also by reducing the patient population undermine the community institutions and health centers you are talking about.
▶ 2:00:15Mr. Weissman: They are medicaid-reliant and many of them will close as will many rural hospitals and many community pharmacies because they are going to be fewer patients to go to those institutions. We are going to haul out the healthcare sector for the vulnerable, rural areas in a profound way.
▶ 2:00:31Sen. Kim: Again, we are moving in the wrong direction. One effort we were trying to move forward on and others have talked about this and it is the apportionment -- the importance of being able to negotiate prices. How essential is that the part of the solution that is necessary?
▶ 2:00:49Mr. Weissman: As we have discussed, you can try a thousand different small things that are important but we need broad approaches. One of those is the medicare price negotiation process which is just a start but if we were to expand it to remove the delays to medicare negotiation and let medicare negotiate all of its drugs, we can achieve massive savings.
▶ 2:01:14Mr. Weissman: If we did that and extended it to the private market, we know from yale university that number is $184 billion every year.
▶ 2:01:21Sen. Kim: What is that number one more time?
▶ 2:01:24Mr. Weissman: $184 billion.
▶ 2:01:27Sen. Kim: Incredible.
▶ 2:01:29Mr. Weissman: That is almost $1.2 trillion.
▶ 2:01:34Sen. Kim: It shows you just what is at stake here and what is achievable. We know what we need to do. We know how to be able to do this. It is a matter of political will and a hope that we are able to make these decisions, go off of the data and be able to hopefully save the american people a lot of money that right now they are struggling with in terms of paying the bills. Thank you so much. I yield back.
▶ 2:02:02Chair Cassidy: I asked unanimous consent for a statement from the biontech innovation organization, a statement for the record for the association for accessible medicines to be admitted into the record without objection. For any senator wishing to ask additional questions, questions for the record is due at 5:00 p.m. Thursday, april 30. Thank you all for being here. It was an illuminating conversation.
▶ 2:02:34Chair Cassidy: The committee stands adjourned. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap.org]