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Politics, Policy & Law

Industry and policymakers must embrace pragmatic drug pricing reforms: Guest Commentary

Or put future innovations and public health at risk

June 15, 2021 12:14 AM UTC

Simply wishing that drug pricing reforms won’t happen will only lead to draconian solutions imposed upon industry that undermine the long-term interests of the U.S. public and global health. The biotech industry must act to support appropriate legislation that protects innovation, supports a vibrant, sustainable market-based biotechnology ecosystem and ensures patients have timely and broad-based access to the most cutting-edge medicines.

President Biden has called for the U.S. to become the world’s “arsenal of vaccines.” The truth is that we already are. Congress has, over the years, enabled the U.S. to become the world’s medicine chest. Yet today Congress is considering polices that if enacted into law may cause irreparable harm to the country’s preeminent position in biotechnology and ultimately great harm to public health.

Two global plagues have shown us that we can take bold action on behalf of patients — and the risks of doing nothing. The U.S. helped the world face and overcome the two greatest public health crises in the last 40 years — HIV/AIDS and now COVID-19 — because of our commitment to patient-led and market-driven innovations, many from entrepreneurial, venture capital-backed biotechnology companies.

Ceding drug pricing decisions to other countries by importing price controls is not the only idea on offer for reining in domestic drug prices. There are other, vastly better ideas that could improve access to medicines without jeopardizing the innovation needed to create tomorrow’s treatments. These include addressing what hits patients hardest — out-of-pocket costs — and aligning pricing with value.

Those of us in industry should not sit on the sidelines and cross our fingers that the worst policy proposals in Washington will fail. We have an obligation to make our voices heard to ensure that the good ideas are the ones that make it through and restore public confidence in our industry and our commitment to putting patient health first.

A tale of two plagues

In the 1980s, HIV patient advocates successfully pressured Congress to create accelerated pathways for patients to access new medicines that unleashed a tidal wave of medical innovation. HIV/AIDS is no longer a death sentence. And through American-led efforts in a public-private partnership, respecting intellectual property rights, new antiviral HIV medications were distributed throughout HIV-ravaged parts of Africa — saving an estimated 18 million lives. Until COVID, it was the largest global health initiative for a single infectious disease that had ever been implemented.

The powerful collaboration between patients and venture-backed entrepreneurs has elevated hope for previously ignored and untreatable conditions and now has literally helped save the world from devastating plagues not once, but twice.

It is no accident that nimble companies were able to rapidly harness vaccine mRNA technology that already had “proof of concept” through venture-backed research, or that FDA regulators quickly pivoted to design flexible clinical trials that demonstrated vaccines’ proof of safety and efficacy in record time. They’ve spent the past 40 years learning how to do it. And they were supported by an ecosystem of positive legislation, including the bipartisan 21st Century Cures Act.

Last May, we predicted that new technologies and policies incubated in the U.S. would lead the industry to look back at the fight against COVID as our finest hour. While we are pleased that our predictions have come to be, we also recognize that the fight is not over yet; some gains are worryingly precarious and the pandemic is still raging in countries such as India.

In the midst of this crisis, Congress may enact ruinous legislation, starting a global race to the bottom that decimates venture investment and cripples new company formation. To prevent the doomsday scenario that would be the consequence of such legislation, our industry needs to act, starting with updating the social contract that underpins the biopharmaceutical economy. Society will not be able to afford the coming wave of life-altering and potentially curative treatments, including cell and gene therapies, unless we address ways to pay for them.

Separating good ideas from bad

If we just want to cut the price of drugs, that’s easy: stop investing in cutting-edge biotechnologies. Simply state that we have many treatments, some cures, and that “this is the best we can do and afford.” But we will not take this option. We know that we still need many more treatments and cures for the devastating diseases, both rare and common, that claim millions of lives each year. We still want to enhance and extend human life and eliminate an enormous amount of human suffering. We also will need new vaccines, antibiotics, and antivirals to address future pandemics before they spread.

America’s biotechnology ecosystem needs to adopt the collaboration, innovation, and sense of urgency that we brought to the COVID vaccine sprint to bring new treatments and cures to all patients faster, more efficiently and more equitably than ever before.

Pragmatic changes in how the U.S. prices and pays for medicines can help us get there.

For example, double-digit annual price increases on medicines has undermined our industry’s reputation. This practice must end. Shifting to value- and outcomes-based agreements that link prices to drugs’ real-world performance can help companies and payers make health-care expenditures more sustainable without weakening incentives to innovate.

Furthermore, the co-pays that patients pay for medicines should be greatly reduced, and in many cases eliminated. No person should ever have to go without medicines because they cannot afford their prescription co-pay. The pain and sacrifice of many families due to high out-of-pocket costs of medicines can be devastating. Access to innovative medicines must be universal.

Finally, Congress should strengthen incentives for physicians serving Medicare patients to prescribe more affordable FDA-approved biosimilars. The bipartisan Grassley-Wyden bill that foundered in the Republican-held Senate last year is a good place to start that update, and includes many of these ideas.

Unfortunately, too many policymakers take America’s biotech ecosystem for granted, and are threatening to import price controls and other measures from abroad that would wreak havoc on America’s ability to lead the world in the development of new medical treatments and cures.

This would be a tragic error. We can and must do better.

John Crowley is chairman and CEO of Amicus Therapeutics Inc. (NASDAQ:FOLD). Kush Parmar is managing partner at 5AM Ventures, one of the founding partners of the COVID R&D Alliance.

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