Maloney, Stabenow, and Smith Lead Colleagues in Introducing Bicameral Package of Legislation to Target Abusive Pharmaceutical Business Practices

Apr 7, 2022
Press Release
Three Bills Would Address Conduct Uncovered by Oversight Committee Investigation and Help Make Prescription Drugs More Affordable by Promoting Competition, Innovation, and Transparency

Washington, D.C. (April 7, 2022)—Today, Rep. Carolyn B. Maloney, Chairwoman of the House Committee on Oversight and Reform, Sen. Debbie Stabenow, Chairwoman of Senate Finance Subcommittee on Health Care, and Sen. Tina Smith led colleagues—including Rep. Peter Welch and Rep. Jan Schakowsky—in introducing a package of legislation targeting business practices pharmaceutical companies use to suppress competition, maintain market monopolies, and keep drug prices high.

 

The legislative reforms follow the Oversight Committee’s three-year investigation into pharmaceutical pricing and business practices that exposed pharmaceutical company practices to suppress competition from lower-priced generics and biosimilars and make drug prices unaffordable for many Americans. 

 

“In 2022, no one should be making the hard choice of paying for needed medications or paying the rent.  Unfortunately, one in four Americans has trouble affording their medications,” said Chairwoman Maloney.  “In my Committee’s investigation, we found that Big Pharma manipulates our health care system to suppress competition and increase profits.  These three bills target Big Pharma’s manipulative practices in order to strengthen competition, promote innovation, and increase transparency into research and development costs—all of which will help make drugs more affordable.”   


“The House Oversight Committee and I have partnered for years to expose how the American people are being ripped off by drug companies who use taxpayer-funded research to develop lifesaving prescription drugs.  We have seen how these drug companies then turn around and charge exorbitant prices for these drugs when people need them the most, without ever having to disclose what they actually spend on research and development.  Today, Chairwoman Maloney, Senator Smith and I are introducing new bills to finally put an end to these practices,” said Sen. Stabenow.

 

“There is no good reason Americans should be paying more than any country in the world for their prescription drugs.” said Sen. Smith. “This bill would prevent large pharmaceutical companies from using anti-competitive tactics that keep prices high for families struggling to pay for life saving drugs.  I will keep pushing to make sure this commonsense legislation gets across the finish line.”

“Families in Vermont and across the United States struggle to afford their prescriptions as Big Pharma continues to manipulate the market to make more money,” said Rep. Welch.  “These bills all work to curb the pharmaceutical industry's exploitative pricing and reduce costs for families.  I appreciate the work done by the Oversight Committee and my colleagues, all of whom agree that Big Pharma’s price gouging needs to end.  We will continue to keep the pressure up to make sure that no American goes without the life-saving medication they need because of a price they cannot afford."

“Big Pharma likes to repeat that they invest more in research and development than any other part of the drug manufacturing process.  That is a lie.  We know from the House Oversight and Reform Committee’s years-long investigation that the top 14 drug companies spent $56 billion more on stock buybacks, dividends for investors, and CEO pay than on R&D in the last five years,” said Rep. Schakowsky.  “I am proud to co-lead the Pharmaceutical Research and Transparency Act of 2022.  This bill would require drug companies to report their research and development expenditures as well as disaggregated costs for individual clinical trials, which are not currently reported.  If pharmaceutical companies don’t report the data, they will face penalties.  The claim that making lifesaving drugs more affordable for Americans would hurt research and development is an industry line to protect their monopolies:  Big Pharma wants to continue to gouge consumers in need of lifesaving medications and treatments.  Enough is enough.”

 

The three bills introduced today are important steps in making drugs more affordable and accessible.  They will promote innovation, enhance transparency in research and development (R&D) spending, and prevent an anti-competitive practice that suppresses generic competition:

 

  • The Discounted Drugs for Clinical Trials Act amends the Federal Food, Drug, and Cosmetic Act to grant eligible researchers access to expensive drugs or biologic products for research purposes at a price no higher than the cost to manufacture.  This would make pharmaceutical research less expensive and promote innovation.   The Oversight Committee’s investigation uncovered evidence that drug companies seek to use the high price of their products to impede the clinical trials of potential competitors. 

 

  • The Pharmaceutical Research and Transparency Act of 2022 amends the Public Health Service Act and the Security Exchange Act to increase public transparency into the costs of clinical trials, which pharmaceutical companies do not currently disclose.  The bill would create a publicly accessible repository of cost data for drug clinical trials and requires responsible parties to submit this cost data within a year of trial completion.  The bill would also require drug manufacturers to report disaggregated clinical trial costs in their annual securities filings.  The legislation would provide valuable data on companies’ investments in innovation and enable evaluation of pharmaceutical industry claims about R&D.  The Oversight Committee’s investigation revealed that drug companies spend more to enrich shareholders and executives than they do on R&D.

 

  • The Generic Substitution Non-Interference Act aims to block an anticompetitive practice used by some brand-name pharmaceutical companies, called “Dispense-As-Written” campaigns, that suppresses the uptake of lower-cost generic or biologic drugs, and leads to increased health care spending.  The bill makes it an unfair method of competition for a pharmaceutical company to direct or provide an item or service for the purpose of aiding or assisting a health care provider to write dispense as written when a generic or biosimilar is available.  The Oversight Committee’s investigation uncovered evidence that pharmaceutical companies use DAW campaigns to preserve their market monopoly for high-priced drugs.


Click here for a one-pager on the Discounted Drugs for Clinical Trials Act.  Click here for bill text.

 

Click here for a one-pager on the Pharmaceutical Research and Transparency Act of 2022.  Click here for bill text.

 

Click here for a one-pager on the Generic Substitution Non-Interference Act.  Click here for bill text.

 

Click here for a list of organizations endorsing the legislation introduced today.  Click here for statements in support of the legislation introduced today.

 

Click here to read the Committee on Oversight and Reform’s drug-pricing investigation report.

 

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117th Congress