- While the Trump administration's drug pricing plans have stalled in recent weeks, several Democratic presidential hopefuls have rolled out their own plans to curb rising pharmaceutical costs, poised to be a key issue in the 2020 race.
- Within the last few days, former Vice President Joe Biden, Sen. Kamala Harris and Sen. Amy Klobuchar all released their own prescription drug pricing plans.
- In a crowded primary field of 20-plus candidates, drug pricing has become a priority for many Democratic candidates, particularly as the party's liberal wing led by Sen. Bernie Sanders advocates for major structural reform through proposals like "Medicare for All."
The plans from Biden, Harris and Klobuchar share some of the same ideas, including proposals allowing Medicare to directly negotiate on drug prices and permitting drug importation from certain foreign countries.
Biden, who has held a consistent lead in early polling, released on Monday his ideas — dubbed The Biden Plan for Older Americans.
In addition to Medicare negotiation and drug importation, the plan seeks to limit annual drug price increases by imposing a tax penalty on companies with price hikes that exceed the general inflation rate. It also supports ending the tax deduction pharma companies receive for direct-to-consumer advertising.
A more complex question Biden's plan seeks to address is how to lower prices of newly launched drugs.
The plan would create a review board to determine a drug's "reasonable price." Independent board members would determine that price based on an evaluation of whether the medicine is launching in the U.S. market first; otherwise that price would be based on the average price in other countries.
Medicare would then pay the "reasonable price." Private insurers offering plans on the individual marketplace would also get a similar rate, Biden's plan states.
On Tuesday, Harris released her own plan. Like Biden, Harris supports Medicare price negotiation, drug importation and not allowing tax deductions for TV advertising.
Harris would also ask the Department of Health and Human Services to calculate "fair" prices for prescription drugs, which would be no higher than 100% of the average price for that drug in comparable countries, such as Canada or Australia. Profits on drugs with prices above that fair price would be taxed at 100%, Harris' plan states, with that money going to rebates paid directly to consumers.
But Harris' plan goes a step further than others, laying out the possibility of an aggressive executive order if Congress does not act within 100 days to address the issue.
In that event, she would issue warning letters to companies selling drugs at prices determined by HHS to be unfair, demanding reductions within a month. If drugmakers don't comply, the plan would seek to allow direct importation of alternatives and prioritize a Justice Department investigation into drug pricing practices.
Notably, Harris said she would also seek to use so-called march-in rights against companies selling drugs based on publicly funded research if previous efforts failed to bring down "abusive pricing." Under the Bayh-Dole Act, the federal government has the authority to "march-in" and license a patent to a lower-cost manufacturer, but has historically refrained from such action.
Klobuchar, meanwhile, unveiled a plan for senior citizens last Friday, which included some policy ideas aimed at the drug industry. The Minnesota senator also supports Medicare direct negotiation and drug importation. Her plan focused heavily on Alzheimer's as well, including mention of expanding support services.
But as the Trump administration's track record makes clear, turning drug policy ideas into practice is a formidable challenge. Much of the power to act lies with Congress, which suggests that a key focus for pharma in the 2020 election will be keeping Republicans in control of the Senate.
"The industry is increasingly relying on the Republican Senate, notably the seniority of some of its supporters," Bernstein analyst Ronny Gal wrote Monday, predicting heavy investment from pharma companies in Senate campaigns for Republicans.