President Joe Biden delivers remarks Thursday on lowering prescription drug prices in the United States, in the East Room of the White House in Washington, D.C. Photo by Sarah Silbiger/UPI | License Photo
Aug. 12 (UPI) -- President Joe Biden on Thursday called on Congress to allow Medicare to negotiate with pharmaceutical companies to drive down the cost of prescription medications, an effort that's expected to face opposition from Republicans and the powerful drug industry.
Since 2006, the federal government has barred Medicare from negotiating drug prices directly after the creation of the Part D prescription drug benefit.
"For every other type of healthcare service, Medicare works to get the best prices for American seniors but for prescription drugs," the White House said in a statement.
"Medicare is prohibited by law from negotiating for the best deal. This needs to change."
In remarks at the White House Thursday afternoon, Biden said Americans can save billions if Congress allowed Medicare to negotiate prices because of its major purchasing power.
"While many pharmaceutical companies have done a tremendous job creating life-saving drugs, including vaccines for the coronavirus pandemic, [there is] a distinction between developing these breakthroughs and on jacking up prices on a range of medications for a range of everyday diseases and conditions."
Biden said to spur competition and drive down costs, he's asked the Food and Drug Administration to find ways to speed up the availability of generic drugs.
"[More generic drugs] will lower prices for everyone," he said. "Research shows that prices can be cut by 25% to 33% and save $54 billion for consumers over the next 10 years. It makes a gigantic difference for the average family."
Biden also asked the FDA to work with states and tribes to import prescription drugs safely from Canada, where medicines are often sold for less than they are in the United States.
"These reforms would lower premiums and copays for millions of Americans. Insulin prices could fall by hundreds of dollars on average," the White House said. "The price for some arthritis medicines might fall by more than $2,000 every month. And for some of the most expensive drugs, prices would fall by tens of thousands of dollars per year.
"Public opinion polls show that the majority of Americans -- Republicans and Democrats -- support this change."
Brian Newell, a spokesman for PhRMA, which represents the industry, said earlier this year that such a move would stifle innovation, research and development.
"The American people reject government price-setting when they realize it will lead to fewer new cures and treatments and less access to medicines," Newell said, according to Kaiser Health News.
"Our industry has partnered closely with policymakers in fighting the [COVID-19] pandemic, and we hope they will partner with us to develop solutions that will lower drug costs for patients, protect access to life-saving medicines and preserve future innovation."
Biden rejected that argument, saying that higher pharma revenues typically to toward executives and shareholders, not research and development. He said big drug companies use profits to "buy back stocks to boost their value and drive up CEO salaries and find ways to box out the competition."
The president said he plans to use $6.5 billion to fund an agency within the National Institutes of Health to develop "cutting edge" discoveries and breakthroughs to facilitate medical innovation from the government end.
Administration officials say other changes are also needed, such as a hard government cap on the amount that Medicare beneficiaries have to pay out-of-pocket each year.