House investigators launch probe of soaring drug prices
House Democrats launched a broad probe Monday into high prescription drug costs, saying the rapid rise in prices is “unsustainable” and soaking taxpayers and patients alike.
Rep. Elijah Cummings, chairman of the House Oversight Committee, sent letters to a dozen drug companies seeking documents on their recent price hikes, strategies to maintain market share and investments in new cures.
Companies say those investments are critical, even if they force U.S. customers to pay higher prices than other developed countries.
Yet Mr. Cummings is afraid companies are putting investors before patients.
“For years, drug companies have been aggressively increasing prices on existing drugs and setting higher launch prices for new drugs while recording windfall profits,” the Maryland Democrat said. “The goals of this investigation are to determine why drug companies are increasing prices so dramatically, how drug companies are using the proceeds, and what steps can be taken to reduce prescription drug prices.”
His letters went out to well-known companies, including Pfizer, which has tussled with President Trump over prices hikes, and Eli Lilly, where Health Secretary Alex Azar worked as an executive before joining the administration.
The investigation, combined with a planned hearing on prices later in January, suggests prescription drugs will be a key avenue of inquiry for Mr. Cummings, beyond newly empowered Democrats’ plans to dig into Mr. Trump’s business ties and 2016 campaign.
Drug prices are a leading concern for members of both parties, however. Voters frequently cite them as a leading concern especially seniors, a key voting bloc.
Sen. Charles E. Grassley, Iowa Republican and new Senate Finance Committee chairman, announced Monday that high medical costs, including drug prices, will be his top priority this Congress.
He said companies have a right to innovate and protect their intellectual property, but not if it means engaging in “unfair business practices and anti-competitive behavior that harms consumers and cheats taxpayers.”
President Trump, meanwhile, has vowed to bring down costs through his extensive pricing blueprint, which focuses on transparency and driving competition.
Democrats say his efforts aren’t ambitious enough. They’ve proposed a series of bills that would use government authority to negotiate down prices under Medicare or align brand-name prices with what other countries pay.
Mr. Cummings says there is no time to waste.
The Health and Human Services Department inspector’s general found that payments for brand-name drugs in Medicare’s prescription-drug benefit increased by 62 percent from 2011 to 2015, even though the number of prescriptions fell by 17 percent.
He said overall spending on the program, known as Part D, is expected to climb to nearly $100 billion this year.
Patients are paying more out-of-pocket because of rising prices, too, the chairman said, noting the percentage of Part D beneficiaries who paid $2,000 out of their own wallets doubled from 2011 to 2015.