FACT SHEET: How Dems’ Big Government Price Controls Will Crush Biomedical Innovation
Today, Senator Richard Burr (R-NC), Ranking Member of the Senate Health, Education, Labor and Pensions Committee, released a fact sheet highlighting the innovation-killing impact of Democrats’ proposed prescription price controls.
Here’s how Democrats’ partisan agenda would harm American medical breakthroughs and advancements:
DEMOCRATIC BIG GOVERNMENT PRICE CONTROLS WILL CRUSH BIOMEDICAL INNOVATION & PREVENT FUTURE CURES
The Schumer plan is simply government-run price-controls paired with sky-high taxes on innovators who save lives. This plan will decrease innovation and prevent future treatments for Americans from being developed. University of Chicago economists estimate the plan will result in 135 fewer new drugs, leading to 331.5 million life years lost in the U.S., over the next 17 years.
Despite these projections, Democrats have not answered the question: Which diseases don’t Democrats want to cure?
Threatening drug discovery and development: Ground-breaking treatments and cures are the products of years-long investment into cutting-edge scientific discovery, rigorous clinical trials, and demanding regulatory review. Under this system, Americans usually have the fastest access to the highest-quality treatments, often before government-run health care systems. These investments, however, are extremely risky:
- On average, it takes 10.5 years from initial research to approval, taking more than a decade for investors to begin earning a return on their investment.
- Many potential drugs in pre-clinical development will never reach a patient, costing manufacturers $474 million in pre-clinical expenses per approval.
- Of those drugs that make it to clinical trials, nearly 9 out of 10 will ultimately fail.
- From 2009 to 2018, the average total cost of developing a new drug was estimated to be nearly$1.4 billion, and certain cancer drugs are estimated to cost nearly $4.5 billion.
Chilling long-term investment: Democrats’ government price-setting would curb investments in drug development – leading to fewer novel medicines reaching patients. Pharmaceutical manufacturers invested more than $120 billion in 2021 in research and development, an average of 25% of their net revenues. These investments, while costly, have developed cures for diseases like hepatitis C, vaccinesagainst some of the most deadly diseases in human history, and immunotherapies that are revolutionizing care for cancer patients. On the horizon are innovations that offer hope to patients suffering from debilitating and life-threatening conditions like sickle cell disease, heart disease, and neurological conditions like Alzheimer’s disease, Parkinson’s disease, and multiple sclerosis.
Generic and biosimilar medicines at-risk: The Democrats’ proposal will decimate developmentof generic and biosimilar medicines, which are generic versions of biologic drugs, like insulin. Biosimilar medications have the potential to save patients and the health care system $40 billion through 2026 alone – exceeding by eight times the projected savings from the Democrats’ “negotiation” scheme over the same period.
Biosimilar development is also an expensive endeavor, costing $100 to $200 million to bring a biosimilar to market. Undermining the incentives to develop these medicines means patients may never experience the benefits of the biosimilar pipeline, which includes at least 26 TNF blockers (immunotherapies), 16 cancer medicines, and seven biosimilar insulins, among numerous others. The Democrats’ reckless price-control scheme will cause patients to pay more for fewer choices.
To download a copy of the fact sheet, click here.
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