DeFazio Introduces Legislation Requiring Affordable Pricing for Prescription Drugs Made with Taxpayer Dollars
Rep. DeFazio (OR-04) today introduced the Affordable Pricing for Taxpayer-Funded Prescription Drugs Act, legislation that would end price-gouging on prescription drugs developed with taxpayer dollars. The legislation would require federal agencies to secure affordable pricing agreements from drug manufacturers before granting exclusive rights to develop prescription drugs or other health care products, and it would ensure that Americans do not pay more for the same drugs compared to individuals in other countries.
DeFazio successfully worked with the Biden Administration and his colleagues in Congress to include drug pricing reform in congressional Democrats’ reconciliation bill framework, which was released on Monday as part of President Biden’s Build Back Better agenda. DeFazio is now pushing to include his Affordable Pricing for Taxpayer-Funded Drugs Act in the final reconciliation bill that will be sent to President Biden’s desk.
“American taxpayers are bankrolling pharmaceuticals and then paying outrageous prices for the same drugs that they helped finance. That’s robbery,” said Rep. DeFazio. “Americans spend billions funding the development of lifesaving prescription drugs, yet Americans pay more out-of-pocket costs for these drugs than individuals in any other country. Meanwhile, big pharmaceutical companies spend significant portions of their budget on marketing, stock buybacks, dividends, and CEO pay, as well as on finding ways to suppress market competition so they can continue to charge exorbitant prices and control the market. Enough is enough. It’s time to end this theft.”
“While nearly every new prescription drug developed over the past decade has been funded by taxpayers, drug corporations charge Americans more than double what people in other countries pay for the same medicines,” said Margarida Jorge, Campaign Director of Lower Drug Prices Now. “Unfortunately, high prescription drug prices have forced too many people to choose between their prescription medicines and meeting other basic needs. Congressman DeFazio’s legislation is a crucial step towards lowering the price of prescription drugs for families and holding drug corporations accountable."
"Our public dollars pay for the development of prescription drugs - and then big pharma forces us to pay again at the pharmacy counter,” said Alex Lawson, Executive Director of Social Security Works. “These corporations are picking our pockets and keeping us sick. Social Security Works enthusiastically endorses Rep. DeFazio's bold legislation, which would rein in the greed of pharma and help people get the prescription drugs that they need."
“Taxpayers support the discovery of new drugs through public investment in medical research. We, the people, pay twice when big pharma corporations pocket the monopoly profits and don’t concern themselves with affordability,” said Peter Maybarduk, Access to Medicines Director for Public Citizen. “Rep. DeFazio’s legislation would fix this by ensuring that taxpayers get a reasonable price for medicine we all help develop. We strongly endorse the Affordable Pricing for Taxpayer-Funded Prescription Drugs Act.”
A recent report by the House Committee on Oversight and Government Reform analyzed financial data from the 14 largest drug companies in the world to evaluate the amount they spend to enrich investors and executives compared to the amount they invest in research and development (R&D) of new treatments.
The Committee’s analysis found that from 2016 to 2020, the 14 leading drug companies spent $577 billion on stock buybacks and dividends—$56 billion more than they spent on R&D over the same period.
It also found that most drug companies spend a significant portion of their R&D budget on finding ways to suppress generic and biosimilar competition while continuing to raise prices, rather than on innovative research.
For years, big pharmaceutical companies have falsely claimed that securing affordable drug prices for Americans would stifle innovation. This report underscores once again that Big Pharma is more interested in making profits off the taxpayer’s dime than helping seniors and all Americans afford the lifesaving prescription drugs they need.