WASHINGTON, D.C.— U.S. Senator Cory Booker (D-NJ) today announced legislation to systemically change the way prescription drugs are priced in order to reduce drug costs for Americans and increase access to the medications they need, with Senators Bernie Sanders (I-VT) and Kamala Harris (D-CA) joining him as original cosponsors. The Prescription Drug Affordability and Access Act would create an independent agency—the Bureau of Prescription Drug Affordability and Access—tasked with conducting reviews of drug prices and determining an appropriate list price. If companies don’t comply with the Bureau-reviewed list price, the Secretary of Health and Human Services (HHS) would allow other entities to produce the drug, thereby voiding the companies’ government-granted exclusivity and ensuring patients have access to the drug at a lower and more reasonable price determined by the Bureau.
The Bureau is modeled after Canada’s Patented Medicine Prices Review Board, which determines if a drug is excessively priced, including by comparing the price of the drug to that in comparable countries. This entity helps keep prescription drug prices in check. In 2017, Canada would have paid 236% more for patented medicines had they purchased them at U.S. prices. Beginning next year, Canada will no longer include the United States in their reference list because of exorbitantly high drug prices.
This is one of the few bills to tackle the challenge of rising prescription drug prices by addressing the list price of drugs. The list price of a drug, also thought of as “sticker price”, is incredibly important to those who are uninsured or underinsured and may have to pay the full cost of the drug. Even patients with good insurance may pay a price tied to a percentage of the list price.
“In a country as wealthy as ours, it’s downright shameful that people have to choose between taking their medicine or paying for other basic necessities,” Booker said. “Every day, millions of Americans struggle to afford their lifesaving medication while the manufacturers of these drugs profit hand over fist with limited to no oversight. On top of that, many of these drugs were developed through research funding from the federal government. We need systemic change that will meaningfully address the exorbitant, rising cost of prescription drugs and put the focus back on patients, not profits.”
“It is beyond my comprehension that today in United States, people are dying because they cannot afford their medication,” Sanders said. “There is no rational reason why Americans should be forced to pay $300 for a vial of insulin that costs $30 in Canada. The greed of the pharmaceutical industry has gone unchecked for too long. I am pleased to cosponsor Senator Booker’s legislation and I look forward to working with him to lower prescription drug prices for working people.”
“No one should have to worry about whether they’ll be forced to sacrifice basic needs in order to afford the drugs they or their loved ones need to stay alive,” Harris said. “For too long, drug companies have been free to charge exorbitant prices for lifesaving medicine, leaving consumers with virtually no other options besides paying up or forgoing treatment. I’m proud to join my colleagues in introducing this legislation to crack down on pharmaceutical industry greed and lower the price of prescription drugs.”
An overwhelming majority of Americans agree that the price of prescription drugs is unreasonably high. So far this year, 3,400 drugs have increased an average 10.5 percent in price, which is five times the rate of inflation. Also in the last year, nearly 30 percent of Americans reported not taking their medicine as prescribed due to the cost. According to AARP, the average annual cost of prescription drug treatment in New Jersey rose nearly 58 percent between 2012 and 2017, adding as much as $1,000 to the cost of some brand-name medications alone.
Insulin provides a telling example of how seriously broken the U.S. drug pricing system is. In the 1990s, various insulins were less than $30 a vial; they are now several hundred dollars a vial. And this despite the fact that the original insulin patent sold for just a few dollars in the 1920s. While high drug prices impact countries and people across the world, the extent of this problem is uniquely American. Per capita drug spending in the U.S. is $1,443, compared to an average of $749 among 10 other peer countries.
The Prescription Drug Affordability and Access Act specifics:
Under the bill, when a drug manufacturer is preparing to bring a new drug to market, it would be required to submit detailed transparency information to the Bureau 45 days before, including:
The Bureau would review that information and other factors to determine an appropriate list price. If a drug manufacturer fails to adhere to the appropriate list price, the Secretary of HHS would allow other companies to produce a generic version of the drug at a cheaper price, voiding the company’s government granted exclusivity.
In addition to conducting an initial review of a drug’s price, the Bureau would also conduct a review under other circumstances, including if the manufacturer wants to increase the list price by more than the rate of inflation. If the Bureau determines the price increase is not appropriate and the manufacturer doesn’t lower the cost within 30 days, the Bureau would have the authority to void any patent, clinical trial data, or other government-granted exclusivity connected to the drug in order to allow for cheaper versions of the drug to enter the market.
For drugs already on the market that have limited generic competition, the Bureau would set an interim appropriate price that would be equal to the median price of the drug in 11 comparable countries while a full review is conducted, giving patients immediate relief.
The Bureau would also be required to ensure that patients have opportunities to meaningfully engage as it conducts its work, including by establishing a consumer advisory council. At least half of the members of the council would be patients or organizations representing patients.
The Prescription Drug Affordability and Access Act is part of Booker’s ongoing effort to lower drug prices for the millions of New Jerseyans and Americans who struggle to afford their medicine. Earlier this year, Booker joined dozens of Congressional colleagues to introduce a package of sweeping reforms to reduce drug prices. The package includes legislation that would tie the price of prescription drugs to the median price in other countries; direct the Secretary of Health and Human Services (HHS) to negotiate lower drug prices under Medicare; and allow patients, pharmacists and wholesalers to import medicine from Canada and certain other countries.
Last year, Booker introduced a bill to boost transparency of states’ Medicaid drug coverage decisions. And earlier in 2018, Booker published a comprehensive report outlining how drug companies failed to use their newfound tax savings from the GOP tax bill to lower prescription drug prices and were instead using the windfall on stock buybacks. He wrote to the CEOs of the ten largest pharmaceutical companies sharing his findings and urging them to do more to lower drug prices. Booker is also a sponsor of legislation that would cap prescription drug cost sharing, make it easier to get generic drugs to market, and make other key reforms to bring down high drug costs.
“Families USA is pleased to support the Prescription Drug Affordability and Access Act, and we thank Senator Booker for his leadership on this legislation,” Shawn Gremminger, Senior Director of Federal Relations of Families USA, said. “High and rising drug prices are a painful and burdensome reality for millions of families in America. The Prescription Drug Affordability and Access Act would hold drug companies accountable by requiring manufacturers to sell drugs at appropriate, affordable prices. With this legislation, pharmaceutical corporations will no longer be able to hold patients hostage with exorbitant prices.“
“Social Security Works is proud to endorse Senator Booker’s legislation, which would combat the currently unanswered influence of pharmaceutical lobbyists by creating the Bureau of Prescription Drug Affordability and Access,” Alex Lawson, Executive Director of Social Security Works, said. “Big Pharma has an army of lobbyists fighting every day to expand their power and increase our drug prices. Until now, patients have had no one fighting solely on their behalf in this corrupt system. Senator Booker is ending that dynamic."
“The Prescription Drug Affordability and Access Act recognizes that Big Pharma charges far too much for vital medicines – and will continue to do so, until We the People make them stop,” Robert Weissman, President of Public Citizen, said. “It recognizes that Big Pharma’s power comes from the grant of patent and other monopolies – and that We the People have the power to end those monopolies if drug corporations refuse to price their products reasonably. Public Citizen is proud to offer its strong endorsement of this legislation.”
“Prescription drugs are one of the biggest drivers of health care costs in the United States,” Raymond Castro, Director of Health Policy at New Jersey Policy Perspective (NJPP), said. “Senator Booker’s bill addresses this head on by requiring transparency and reducing the price of medication when it is excessive. This will benefit not only those who are stretched to the limit and struggling to pay for their prescription drugs, but anyone who pays a premium and all taxpayers who help pay for essential public health coverage. Lowering the price of medication will allow more people to get the health care they need, curbing the even higher shared costs associated with patients not taking their medicine. This will make New Jersey healthier and provide savings for individuals and businesses who provide health coverage for their employees. Everyone wins under this proposal.”
“Working families need access to life-saving medicines without profiteers unfairly rigging the system to increase profits,” Donna M. Chiera, President of AFT New Jersey, said. “The Prescription Drug Affordability and Access Act would help regulate the market to insure that everyone receives the care and treatment they deserve as a human right and need as patients. “
"For too long, many in this country have been struggling to afford life-saving prescription medications,” Debbie White RN, President of Health Professional and Allied Employees, said. “The Prescription Drug Affordability and Access Act is designed to curb the continued escalation of pricing medications. Affordability and access to prescribed medications will ensure patients can recover from illnesses, maintain a healthy life style and avoid unnecessary hospitalizations. We applaud Senator Booker for finding a solution to stop the runaway pricing found today in the pharmaceutical industry."
“The Prescription Drug Affordability and Access Act takes direct aim at controlling prescription drug prices and provides much needed relief for patients unable to access the medicine they need to stay healthy simply because drug prices have skyrocketed beyond their reach,” Maura Collinsgru, Health Care Program Director for New Jersey Citizen Action, said. “Drugs don’t work if people can’t afford them. For far too long the pharmaceutical industry has set the price of prescription drugs virtually unchecked. This legislation will remedy that and help ensure drug prices would be reasonable and appropriate, and based on factors such as federal investment in a drug’s development, the price’s impact on patient access, and the list prices for drugs in other developed nations. The Prescription Drug Affordability and Access Act would be a great step forward in reining in drug costs for all Americans, and we thank Senator Booker for sponsoring this legislation.”
"By ensuring that drug prices are reasonable and comparable to prices paid in other wealthy countries, the Prescription Drug Affordability and Access Act will help end the pharmaceutical industry's ability to charge inflated premiums in the U.S. that render prescriptions unaffordable for millions of Americans,” Marcia Marley, President of BlueWaveNJ, said. “We thank Senator Booker for sponsoring legislation that will end price-gouging by pharmaceutical companies.”
“The NAACP New Jersey State Conference has a long history of supporting policies that will have a direct and positive impact on communities of color in the state and throughout the county, and Senator Booker’s Prescription Drug Affordability and Access Act will do just that. For far too long, low-income and communities of color have suffered disparate health outcomes because so many struggle to afford the healthcare treatment they desperately need. No one should have to choose between treating their conditions and paying for their monthly bills. This bill puts patients before profits and care before cost, which is why I would like to see it become law.”—NAACP New Jersey State Conference
“The high cost of healthcare is one of the most important issues affecting New Jersey, but it is especially pronounced within the Latino community. Across our 375 member churches that we represent, we see firsthand the impact that the high cost of drugs has in creating barriers to treatment. We are thankful that Senator Booker has introduced this bill which would help control the cost of prescription drugs so that everyone can afford the medications they rely on to live.”—Coalition of Latino Pastors
"The Indivisible NJ Legislative Advocacy Coalition supports Senator Booker's efforts to advance quality universal health care and considers this bill a start to address the country's prescription drug price crisis. We urge Congress to follow suit, take action, and encourage further legislative and educational initiatives to boldly change the current system and costs."—NJ Indivisible Legislative Coalition of Middlesex County
“Women for Progress proudly endorses Senator Booker’s new legislation to lower prescription drug costs. Americans spend an average of $1,200 on prescription drugs annually, more than any other developed country in the world. With costs continuing to soar, we must act urgently and explore all options to bring costs down. This legislation would hold pharmaceutical companies accountable and ensure the health of patients come before profit.”—Women for Progress