After a series of decisive court losses, the pharmaceutical industry appears to be taking its fight against Medicare drug price negotiations directly to the people—and the White House is not impressed.
This week, the high-powered industry group PhRMA (the Pharmaceutical Research and Manufacturers of America) released two eye-catching attacks on federal efforts to lower America's singularly astronomical drug prices. In a press release Tuesday, PhRMA announced an analysis suggesting that the Medicare drug price negotiations—part of the Biden administration's 2022 Inflation Reduction Act—could actually cost some seniors and people with disabilities slightly more in out-of-pocket costs. The analysis, however, relies on a key—and questionable—assumption that the federal government will set price limits using the highest possible estimate for maximum fair prices in 2026.
Milliman, the consulting firm PhRMA commissioned to do the study, cautioned that the actual prices "will certainly vary due to differences in unit cost and utilization trend, 2026 benefit designs, and actual 2026 maximum fair prices."
On Wednesday, PhRMA then announced an "educational campaign" on how the US intellectual property system "is actually the vehicle for lower [drug] costs." The bold claim is likely jarring to the many critics of the pharmaceutical industry, who for years have noted how drug companies exploit double patenting or "patent thickets" to extend monopolies on drugs and hold off low-cost generics from entering the market.
“They’ll lose”
For instance, staunch drug pricing critic Sen. Bernie Sanders (I-Vt.) has railed against patent thickets in congressional reports, noting that companies often file dozens of patents for a single drug. Merck, for instance, has 168 patents on its cancer drug Keytruda, most of which were filed after the drug was approved by the Food and Drug Administration. Johnson & Johnson, meanwhile, filed 57 patents on arthritis treatment Stelara, 79 percent of which were filed after FDA approval.