In their own words, top 2020 Dems explain how they’d lower drug prices
Every single Democratic presidential candidate agrees that the federal government should take a far more aggressive approach to lowering drug prices — including letting Medicare negotiate drug prices.
But beyond that plank, there are quite a few differences between the candidates when it comes to taking on the pharmaceutical industry. To suss out exactly where they diverge, STAT questioned seven candidates during their interviews with the editorial board of the Boston Globe, STAT’s sister publication. (STAT was not involved at all with the board’s discussions about a forthcoming endorsement.)
Most of the candidates have already rolled out drug-pricing plans, and they were well-prepared to discuss an issue they said voters regularly brought up. Both Sens. Elizabeth Warren and Amy Klobuchar seemed to light up at the question, eager to engage on the topic. Former South Bend, Ind., Mayor Pete Buttigieg seemed a ready candidate, mixing politics with personal stories from the campaign trail. And Andrew Yang, who comes from the entrepreneurial world, was quick to cite a financial analyst friend in his response.
During the conversations, insulin and EpiPens often came up as the big boogeymen of drug pricing. The candidates also lumped pharma in with oil and insurance companies as the industries that have corrupted Washington.
“I’ll use the power that is already there for a president to lower the cost of commonly used prescription drugs, like insulin, and EpiPens, and HIV/AIDS drugs,” Warren said in a characteristic remark. “That will save families hundreds of millions of dollars.”
They also pushed back on the idea that their policies will dampen investment in new drugs. The nonpartisan Congressional Budget Office, however, has said that if a drug pricing bill pushed by House Democrats, which contains many policies similar to those in the presidential candidates’ platforms, became law, it would lead to eight to 15 fewer drugs created over 10 years.
Below are excerpts from each of the conversations, lightly edited for length and clarity. Some candidates, including Sen. Bernie Sanders and former Vice President Joe Biden, have not yet met with the board. The others all appeared in person, except for Warren, who appeared via video conference while she was in Washington for the impeachment trial of President Trump.
Sen. Elizabeth Warren of Massachusetts
On drug pricing, the CBO has said that if some of the policies embraced by Democrats were to go into effect, it would reduce the number of new drugs invented. Is that something you would be willing to accept if you could implement your policies, and how do you strike that balance?
I just don’t think that’s true. The way we strike this balance right now is that we put money into the NIH, and since the first day I got to the Senate, I have been fighting for more funding for NIH. But in return, I think we ought to see lower drug prices. The fact that the American taxpayer pays both for a huge part of the medical research that is done around the world, and then pays the highest price for the drugs that come from that medical research is just simply not right. We need to have a system where we bring down the cost of these prescription drugs, but at the same time, make more investment in medical research.
We know the kinds of things that are coming our way. Alzheimer’s. The costs of just physical care of people who are not going to be able to care for themselves — our best hope is to invest in medical research. If we could simply push off the onset of Alzheimer’s by five years, and the curve goes from there, we could save literally billions and billions of dollars. If we could find a cure, it’s tens of billions, hundreds of billions into the future. We need to get these drugs to market. It starts with the investment in science. And if the American taxpayer is going to pay for that, which I think we should, then the answer has to be that these drugs are available at a reasonable price.
Sen. Amy Klobuchar of Minnesota
If you were able to implement your drug pricing plan, would you be willing to accept that fewer new drugs might get developed? Do you view that as a sacrifice you have to make?
I’m not sure we have to concede that. We all know that nothing has happened on drug pricing, and [pharmaceutical companies] have basically been running up monopolies in many cases. That’s what EpiPen was about, that’s part of what insulin is about. So I actually would get more competition in, and I don’t know that that necessarily means you’re going to have less drugs.
First, I’d let in less expensive drugs from other countries, like Canada. That would make a huge difference, because it would create leverage with the pharmaceutical companies. The president can do this herself, without Congress, just by asking for a waiver.
The other thing I would do is lift the ban on Medicare negotiation. I’ll stop pharmaceutical companies from paying off generic [companies] to keep their products off the market. I just think there’s so much more that can be done, because nothing has been done.
One thing you didn’t mention that some of the other Democratic candidates have suggested is, in certain cases if a drug costs too much or a company raises the price too much, breaking a patent. Would you ever consider that?
Yeah, we can look at that. It’s one way to do it. I just like the competition way. There’s also a bill tied to international prices that’s over in the House right now. It’s actually an exciting area to work on because nothing has been done. We can only get better.
Former South Bend, Ind., Mayor Pete Buttigieg
You’ve spoken about breaking patents if a drug costs too much. What kind of threshold would a drug company have to cross for your administration to step in and try to find another manufacturer?
I view that as an absolute last resort. There can’t be an increase in prices that’s greater than inflation. We’re seeing companies do this simply because they can. When you run for president you can’t go a couple of days without talking to somebody who’s describing someone they love who’s dependent on insulin or some medication. A lady gave me an insulin vial the other day that she had spray-painted gold. The tag on it said, “This is worth its weight in gold and it shouldn’t cost that.” You see what people are up against, and it requires action.
My point is, when we’re talking about putting the brakes on [price hikes], we can do that through tax penalties. I view the patent — that’s really when you have malfeasance or documentation that a company is failing to engage in good faith negotiation or other activities that require a very strong remedy. I hope never to reach for that tool, but I think it’s really important that it be on the books. I’m all for people who invent wondrous therapies to be well-rewarded. But there comes a point where the laws that we’ve set up to make it possible for you to operate have now empowered you to do more harm than good.
If you were to implement your full drug pricing plan, would you be willing to accept fewer new drugs being invented?
We can continue to support innovation as well. Remember, a lot of these innovations and developments rest on the bedrock of taxpayer-funded research. Obviously one of the policy design challenges is to do this in a way that doesn’t really diminish the development of new therapies any more than absolutely necessary. And I think we can do that.
You’ve spoken about the government seizing patents or in some cases even manufacturing drugs. How would you prioritize which drugs that would apply to? What kind of threshold would a drug company have to cross for your administration to take one of these actions?
Failure to keep your pricing in line with international standards. You should not be charging Americans dramatically more than you’re charging citizens in other parts of the world. It’s even more dramatic given that in most cases we subsidize the development of these drugs, so the taxpayers in a way are paying for it twice. So I would not pursue a forced license unless a drug company was unable to keep its prices in line with international standards.
Would you be willing to accept fewer drugs being invented?
I just don’t believe that case. I have a friend who’s a brilliant financial analyst who went through the numbers, and the drug companies are profiteering at record levels. If they argue, hey, if our profits are less, we’re going to have less in innovation — it’s not plausible. In large part because these drug companies have stopped directly investing in innovation anyway. Now they’re just going to come here to Boston and try to buy a promising biotech. They’re going to invest the same amounts as long as they believe they’re going to be able to make money from it.
Aren’t those biotech investors, though, expecting the same kind of payouts when a pharma company acquires one of those biotechs? To what extent do you think that depends on the drug company thinking it’s going to be able to charge these prices?
That is a possibility. You would have to have investors recalibrate their expectations of what drug prices would be at the top end. I don’t believe though that you would see a massive [decrease] in investment because if there’s a drug that addresses an issue meaningfully, in my mind, there will still be plenty of gold at the end of the rainbow.
Would you ever consider seizing a patent or granting a license to a rival company if you determined a drug company to be a bad actor? If so, what kind of threshold would a company have to cross for you to do that?
We basically give people a patent to charge what they want for seven years, and that’s their incentive to come up with new molecules. I think the biotech companies are going to come up with some amazing things that are going to solve problems that have been around for 25,000 years, and that’s important.
My biggest issue is after the first seven years. There are so many things where they’re gaming the system. And people are talking about gaming the system in terms of what they charge us versus what they charge Canadians or Australians or whoever. But there’s the issue of what happens after the first patent expires. So am I in favor of negotiating during the first seven years? Of course I am. Do I believe in the idea of seizing people’s patents? I think it’s very hard to determine that action when someone has a patent. We should be using the full weight of the buying power of the American government and all of our other relationships with those companies to say, You screw us at your peril.
Sen. Michael Bennet of Colorado
Drug pricing was supposed to be something that Nancy Pelosi, Mitch McConnell, Donald Trump all pointed to as an issue that might get addressed. But the legislation that came out of the Senate Finance Committee in July has stalled. So I’m curious to know how you view that as a member of that committee, and what it says about legislative dysfunction.
A modest step is what that bill is, and it would be great if we got that passed. I’m for it, but it will do almost nothing to help people in my state who are struggling with the decision to buy food or to buy medicine. And even half measures like that can’t get across the finish line in Washington because of our complete dysfunction.
We were completely broken before Donald Trump arrived. I think Trump is a symptom of the fact that we’ve had 50 years of an economy that hasn’t worked well for 90% of the American people and our institutions are crumbling before our eyes. Enough people said, “Let’s send a reality TV star to Washington, we can’t make matters worse, let’s blow the place up.”
Former Massachusetts Gov. Deval Patrick
The life sciences initiative you supported as governor, those industries got a lot of public resources to spur their growth. Do you think those companies in turn and the drug industry more broadly have acted responsibly to the public?
Drug pricing — that is a broken system. Because almost all of the investment — whether it’s public or private — is done in the U.S., which then is used to justify the negotiations with FDA [and] the prices that are paid in the U.S. But the benefit of that is enjoyed [via] lower prices outside the U.S. Part of the solution has got to be how to figure out how to spread that cost base. In the short term, the idea of the federal government negotiating with drug companies and outside our borders is a terrific idea. But I’m not sure I’m ready for price controls.