Chairwoman Maloney Releases Damning New Report Revealing Taxpayers Lost More Than $25 Billion in Savings Due to Ban on Medicare Negotiating Drug Prices

Sep 23, 2021
Press Release
Documents Show Drug Companies Target Americans For Higher Prices

Washington, D.C. (September 23, 2021)—Today, Rep. Carolyn B. Maloney, Chairwoman of the Committee on Oversight and Reform, released a new staff report revealing that taxpayers could have saved more than $25 billion on just seven drugs over a five-year period if Medicare had been able to negotiate directly with pharmaceutical companies for lower drug prices, the way other federal health care programs do.  The staff report, the Committee’s eighth report in its investigation into pharmaceutical pricing and business practices, analyzes new internal data from drug companies to estimate the savings lost because of the prohibition on Medicare negotiation.  These findings underscore the urgency of enacting reforms in the Build Back Better Act to empower Medicare to negotiate directly with drug companies and rein in skyrocketing drug prices.     

 

“For years, drug companies have deliberately targeted the pocketbooks of Americans in need of life-saving medications.  Today’s report lays bare the billions of dollars taxpayers could have saved if Medicare had been able to negotiate directly for lower drug prices,” said Chairwoman Maloney.  “The lost savings highlighted in today’s report are likely only a fraction of what taxpayers could save if we empower Medicare to negotiate.  It’s time for Congress to step up and pass reforms in the Build Back Better Act to finally give Medicare the tools to secure a better deal for patients.” 

 

“Prescription drug prices are out of control and only getting worse,” Energy and Commerce Committee Chairman Frank Pallone, Jr. said.  “Americans pay more at the pharmacy counter than any other country in the world for the exact same medications - a fact that is underscored by this new report from the Committee on Oversight and Reform.  It’s time for Congress to finally empower the federal government to negotiate fair prescription drug prices for the American people, while also saving the federal government billions of dollars that can be reinvested in other health priorities.”

 

“This report makes clear that the pharmaceutical industry has exploited and targeted patients in the United States with exorbitant and unnecessary price increases, while maintaining lower prices around the world.  These practices cost U.S. taxpayers, employers, and patients billions of dollars.  It is time for the United States to do what other countries have done and take steps to protect our citizens from Pharma’s price gouging,” said Rep. Welch.  “Life-saving and life-extending prescription drugs are only helpful if we can afford them.  We must give Medicare the power to negotiate directly with pharmaceutical companies to lower drug prices for the people we represent.”

 

“Sky high drug prices drive up out-of-pocket costs, putting access to affordable medicines out of reach for millions of Americans – and their health at risk,” said Frederick Isasi, Executive Director of Families USA.  “It’s time for David to call Goliath’s bluff.  By lowering prescription drug prices Congress can finally end the pharmaceutical industry’s abusive and predatory practices and give all families a fighting chance for a healthier future.”

 

The Committee’s investigation shows:

 

  • If Medicare plans had secured the same discounts as other federal health care programs between 2014 and 2018 on just seven of the drugs investigated by the Committee—Lantus, Humira, NovoLog, Enbrel, Lyrica, Imbruvica, and Sensipar—Medicare could have saved more than $25 billion.

 

  • For just three frequently used insulin products—Lantus, NovoLog, and Humalog—taxpayers could have saved more than $16.7 billion between 2011 and 2017.

 

  • Internal company documents reveal the extent to which drug companies target the U.S. market for price increases—in part because Medicare cannot negotiate directly—while maintaining or lowering prices in the rest of the world.

 

  • Documents show that drug companies rely on Medicare to boost profits.

 

Click here to read today’s staff report.

 

To hear about the impact of skyrocketing drug prices, here are stories of patient experiences with Lyrica, Humira, Imbruvica, Gleevec, Acthar, Enbrel, Revlimid, and Copaxone.

 

Click here to read previous Committee reports on pharmaceutical pricing and business practices.

 

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Issues: 
117th Congress