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ICYMI: Bipartisan Bill Would Help Lower Rx Drug Prices

February 11,2020

February 10, 2020

By Anthony Kern

The Trump
administration recently announced its support for a bipartisan
bill that would help curb prescription drug prices. The Prescription Drug
Pricing Reduction Act—introduced by Senators Chuck Grassley, R-IA, and Ron
Wyden, D-OR—would shield vulnerable senior communities on Medicare from rising
drug costs and penalize pharmaceutical corporations for price gouging. In the
past few years, pharmaceutical behemoths, facing little competition, doubledtripled, and quadrupled the price of their
prescription drugs. 

The Prescription Drug Pricing
Reduction Act (PDPRA) would penalize insulin manufacturers and other
pharmaceutical manufacturers that raise their prices faster than the rate of
inflation. In other words, companies with little competition would have an
incentive to not hike their prices. Otherwise, what would stop monopolistic
pharmaceutical companies from price gouging? 

Many people
are hesitant about government intervention in the marketplace. But Medicare
isn’t the marketplace; it is a program through which the government effectively
subsidizes pharmaceutical companies. Medicare is the pharmaceutical industry’s
second-largest customer, spending $126 billion on prescription
drugs in only one year. 
And, as drug prices rise, taxpayers
will be footing even higher bills. This bill would not impose “price controls,”
as pharmaceutical companies would remain free to charge whatever they want in
the private market. What this bill does is impose a cap on the growth in
taxpayer subsidies to pharmaceutical companies. In total, the PDPRA’s measures
would save taxpayers over $100 billion

Americans want their lawmakers to
pass legislation that curbs prescription drug prices. A poll found that eight
in ten voters think Congress should take action to
lower drug costs. The PDPRA would
ensure that Americans can afford their needed prescriptions.

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