- About HHR
In the interview that accompanied President-elect Donald Trump’s Time magazine Person of the Year story, he said, “I’m going to bring down drug prices. I don’t like what has happened with drug prices.”
If you don’t find yourself agreeing with Trump very often, you may have finally found common ground. As the President-elect said, there is a lot not to like about drug prices.
The global crisis in medicine access is deadly and shameful, causing millions of unnecessary deaths each year. Even in the comparatively wealthy United States, the cost of prescription drugs is bankrupting families and forcing many to choose between paying for medicine or food. Monopoly-protected medicine prices are straining state and federal health budgets. Hundreds of US cancer physicians wrote an angry article in Mayo Clinic Proceedings protesting the fact that one in five of their patients can’t afford to fill their prescriptions—not surprising, with the cost of cancer medicines now averaging over $100,000 per patient.
EpiPen price hikes and the greed of “Pharma Bro” Martin Shkreli are just the most high-profile symptoms of a diseased medicines system that features routine double-digit annual price increases on many necessary drugs. As a result, a large majority of Americans are demanding action on drug pricing.
Trump has heard them. And this is not the first time Trump has raised the medicines issue. During the campaign, he had harsh words for pharmaceutical corporations and vowed to support much-needed negotiation of drug prices paid by Medicare.
There are a lot of Trump promises he is never going to deliver on, and maybe never intended to. Good luck getting uniform compliance with everyone saying, “Merry Christmas.” The much-promised wall on the US-Mexico border would be architecturally impossible, not to mention its ethical and financial dimensions. He may not even be able to get some of his Cabinet appointees confirmed by the Senate.
But lowering drug prices, meaningfully and quickly? That he can do. I have not seen my name on any list of potential Trump Administration appointees. I have yet to be summoned to an interview at Trump Tower. But here is some unpaid advice, and it has an aggressive ring to it that I think the President-elect will like:
One of the most frustrating aspects of the drug pricing crisis is that most of the truly impactful medicines trace their origins back to government-funded research. The Bayh-Dole Act of 1980 provided the legal foundation for a shameful give-away of taxpayer resources to corporations, allowing the monopoly patents on federally-funded inventions to be claimed by private entities—which then sell back the invented medicines to the US government at monopoly mark-up prices. (Senators Bayh and Dole have spent part of their post-retirement careers working on behalf of pharmaceutical corporations.)
But the Bayh-Dole Act does contain one safety hatch, which those concerned about the give-away were assured at the time would protect taxpayers and patients: march-in rights. Whenever the federally-funded discovery is not available on “reasonable terms” from the patent holder, or if a health or safety need arises, the government has the right to “march-in.” That means the government agencies can license the invention for manufacture by someone else for sharply reduced costs. (Generic medicines are priced as much as 90% less than patent-protected versions.)
But, the federal government has never exercised its march-in rights in the 36-plus years since the Bayh-Dole Act was passed. Perhaps unsurprisingly many pharmaceutical company officials used to work for those federal agencies or vice versa, and many corporate lobbyists are devoted to making sure that march-in never occurs. The industry that is arguably the most profitable in recent history is determined to stay that way.
The pharmaceutical sector has managed to straight-face argue that the “reasonable terms” safeguard in the Bayh-Dole Act does not mean pricing at all. It claims the only requirement on the beneficiary of a monopoly of a government-discovered drug is to make it commercially available, no matter what the price. As one journalist wrote, “it is also fair to say that most of the attorneys who make this argument represent drug companies.”
To date, the National Institutes of Health (NIH) under multiple presidents, including Obama, has not changed this demonstrably preposterous interpretation. Every time a march-in petition has been filed, the NIH has denied it. As Trump would say: Sad. Very sad.
The most significant harm in avoiding march-in is that it has signalled to pharma companies that there is no limit on what they can charge. As multiple members of Congress have said, and some similar events have proven, even the threat of march-in by NIH could bring down medicines prices significantly. Is the President-elect who prides himself on his negotiating prowess listening?
There are many medicine candidates for march-in right now. One is Xtandi, the prostate cancer drug developed at UCLA with federal funding and now patented by Japanese pharma company Astellas, which sells it back to the US at enormous markups that put the annual cost per patient at $100,000. The NIH under Obama and Francis Collins rejected a Xtandi march-in petition earlier this year, but the petitioners have signalled they may refile under a new administration.
I hope they do. And I hope the President-elect makes this one promise he delivers on.
Fran Quigley is a clinical professor and director of the Health and Human Rights Clinic at Indiana University McKinney School of Law and coordinator of People of Faith for Access to Medicines. His book, A Prescription for Change: 22 Reasons Why Our Medicines System is Sick and How We Can Cure It, will be published by Cornell University Press in 2017.