If this come to be… our country can a just about say good bye to just about all new medication introductions.  Clinical trials for a new product can take 10-12 years and can involve investing hundreds of millions of dollars just to be it thru clinical trials and approved by the FDA to bring it to market. I can’t count the number of times that a Pharma get a med thru 1st & 2nd clinical trial stages and the drug is dropped because of some unforeseen issues in the 3rd stage of clinical trials… and hundreds of millions of clinical trial dollars is literally FLUSHED DOWN THE DRAIN.

I have seen some mentioned that the “price target” for the government on any/all of the medications.. is what the Veteran Admin pays for those medications. The VA works from a fixed medication formulary …. they send out bids for which pharma is going to provide a particular medication for a particular class of med.  I don’t know if the VA orders meds directly from the Pharma, or they have their own regional warehouses or they have “deals” with the major drug wholesalers to stock and ship their contract meds for an administration fee.   There is no insurance company nor PBM nor any other “middleman” with their own built in overhead costs and desire to show a profit. The VA – I would suspect – to ask for fixed prices on a particular med for a mutli-year contract and for a guaranteed number of doses the VA will purchase over the length of the contract.  It is not unusual for the VA to purchase BRAND NAME MEDS for a price lower than community pharmacies pay for the generics of those brand name meds.

Believe it or not, we are seeing some of the same consequences within the petroleum industry.  CALF is first, but other will follow that by 2035 all new cars sold there MUST BE ELECTRIC.  Again in CALF all new homes must have a certain amount of solar energy cells on the roof..  Some states are outlawing central home furnaces to run on kerosene or heating oil…  These petroleum companies that must invest 100 of million of dollars to develop a field that is producing petrochemicals, when bureaucrats are busy trying to create less demand for those products ? 

Businesses do not invest their capital into a infrastructure to produce a product or providing a service if there is a substantial risk of some bureaucrat making some rule/law/regulation that dictates what you should charge for your product or service and the bureaucrats are mostly clueless about what it costs the company to develop, produce, deliver a particular product or service. If a business is forced to accept a lower price for their product or service… the business is going to reduce the number of employees, the hours of operation , the quality of their product or service or even just stop providing the product or service altogether.

Becerra leaves door open to march-in rights to lower drug prices

https://www.axios.com/2022/10/07/becerra-drug-price-march-in-rights

Despite newly enacted drug pricing measures, the Biden administration hasn’t ruled out more sweeping actions to lower the cost of medicines, including asserting control over the patents of treatments developed with the government’s help.

Why it matters: The Inflation Reduction Act signed by President Biden in August for the first time allows Medicare to negotiate lower prices for some drugs. But Health and Human Services Secretary Xavier Becerra on Thursday left an even bigger sword hanging over the pharmaceutical industry, saying so-called march-in rights are not “off the table.”

Between the lines: Progressive advocates have been pushing for years for the federal government to use power under a 1980 law to “march in,” take over the patent of a drug and license it to other manufacturers as a way to lower the price.

• Even the Obama administration rejected the idea, a sign of how out of the ordinary any move by the Biden administration would be.
• Then-National Institutes of Health director Francis Collins wrote in 2016 that the power was meant to be used in instances like when a drug is in short supply, not when it simply has a high price.
• The federal government narrowed the circumstances under which it could assert the rights for some prospective COVID-19 drugs.

What they’re saying: “We will continue to explore every option we have,” Becerra told reporters when asked about march-in rights. “We’ve never taken anything off the table. And we will work on every one of those aspects of lowering drug prices. Why don’t I leave it at that?”

Be smart: It would be a major shock if HHS actually went through with using march-in rights, especially because Congress just took action on drug pricing.

• But it is notable that Becerra isn’t ruling out the idea, and is content to at least let the threat linger.

The big picture: The idea has gained ground in the Democratic Party. Multiple 2020 presidential candidates touted the idea, though it tended to be progressives like Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) more than Joe Biden.

• Progressive advocates are keeping up the pressure, protesting outside HHS headquarters in support of march-in rights on Thursday.
• Peter Maybarduk, a drug pricing advocate at Public Citizen, said at the protest that the Inflation Reduction Act is a “generational victory,” but more action is needed to target launch prices of new drugs and disrupt “the monopoly control that is the root of corporations’ pricing power.”
• Drug companies argue the move would upend the system that allows for innovation and encourages development of new treatments.

The bottom line: While further action hangs as a possibility, HHS must also begin implementing the Inflation Reduction Act. Asked about relations with pharmaceutical companies given their opposition to the law, Becerra said he’s seeking an open process as details are worked out.

• “We’re going to include them all the way through,” he said.

Filed under: General Problems