By Chris Woodward
It’s an issue of bipartisan concern, but what can be done to fix prescription drug prices?
Liberals have talked about the need for price controls – and even President Trump has talked about the need for government drug price negotiations for Medicare and Medicaid. Still, many conservatives and free-market advocates warn these methods would do more harm than good, perhaps resulting in less research and development for drugs.
Matthews shares which of those ideas stand out to him.”The good news is that Dr. Scott Gottlieb has been approved and is now running the Food and Drug Administration,” says Merrill Matthews, PhD of the Institute for Policy Innovation. “He has a number of ideas and he’s been a free-market supporter for some time.”
“[Dr. Gottlieb] wants to increase the competition of generics – make sure that generics have a faster pathway to get out and be approved so that they can begin to lower those prices,” he says. “He’s looking at some other financing methods for various drugs. And then the drug companies themselves are moving to some new models, one which essentially is pay-for-success.”
He explains under that model, if a physician prescribes an expensive drug that does not meet the patient’s needs or “hit certain markers” that are set beforehand, the patient isn’t required to pay for the drug.
“They’re increasingly focusing on the smaller populations with difficult diseases,” he explains. “But that’s what you want: you want the drug companies addressing those issues. But [in doing that] and when you have these failures, they get added in – so it makes it very expensive.”
Case in point: Pfizer’s decision to halt research into new drugs for Alzheimer’s and Parkinson’s disease.
“Pfizer had devoted hundreds of millions of dollars to find a cure or at least the ability to be able to diminish the impact of the disease, [but] they’ve come to the conclusion they don’t think they’re going to be successful anytime soon. So they decided to pull that research money away from that, and they’re letting 300 employees go that have been dedicated to that research,” Matthews adds.
While he acknowledges that scenario is hard for those suffering from that disease, he says it’s also hard on the developers of the drug. “… Because that means the money they were spending on that [research] won’t be recouped from new drugs,” he concludes. “That money is going to have to be transferred over to the other research and development costs … and that will be added into the costs of other drugs.”