Time to put patients before profits

I hear it all the time from Orange County families: the cost of prescription drugs is just too high.

Across the country, nearly one in five Americans reported skipping a dose or cutting pills in half in the previous year because of high costs, according to a recent Kaiser Family Foundation survey. Nearly one in four Americans didn’t fill a prescription altogether for the same reason.

Meanwhile, pharmaceutical companies’ profits are higher than ever before. An analysis conducted by Johns Hopkins Bloomberg School of Public Health and West Health Policy Center found that Big Pharma would still be the “most profitable industry sector” even if the industry lost $1 trillion in sales.

As a consumer advocate for nearly two decades before I came to Congress, I’ve seen this show before. Big corporations are gouging everyday Americans.

I’ve introduced legislation to crack down on this corporate abuse. My Freedom from Price Gouging Act would protect patients from unreasonable price spikes and save taxpayer dollars.

Here’s how. Medicare Part B currently provides insurance coverage for drugs that are often administered in outpatient settings, including chemotherapy. If a drug manufacturer raises the price of medication covered by Part B beyond the rate of inflation—in other words, if the increase is unnecessary—my bill would recover those taxpayer dollars.

This way, pharmaceutical companies can’t hike prices to make a quick buck at patients’ expense.

At the same time, my Freedom from Price Gouging Act will save money. The Congressional Budget Office estimated that similar legislation in the Senate would save taxpayers $10.7 billion between 2020 and 2029.

I spoke with one of the hospitals in my district to learn more about price hikes under Part B. To say I was alarmed by the numbers that they shared with me is a gross understatement.

In just one year, from 2016 to 2017, the cost of just one of the chemotherapy drugs they use rose 398 percent. The price of another rose 280 percent.

I want Big Pharma to apologize to every cancer patient in my district who has watched the cost of their care skyrocket. They’re fighting for their lives. They shouldn’t have to fight to afford their drugs just so pharma executives can pocket another million by overcharging.

To be sure, we often hear the excuse that huge companies need huge profits for research and development. But they actually are spending around $50 billion more on stock buybacks than on research. And who benefits royally from stock buybacks? Big Pharma executives who receive thousands of shares in stock on top of millions in compensation.

Under the Trump tax law, this practice has only grown. Drug companies have announced nearly $73 billion in share buybacks since 2017.

Let that sink in: corporations have jacked up drug prices, exploded their profits to record highs, and pocketed for themselves the windfall from the president’s tax breaks. They should have that $73 billion tax break to invest in research and development. Think about how many innovations were lost to patients.

This is patently unfair. We’re playing politics with people’s lives, while big pharmaceutical companies pad their profits.

Passing my Freedom from Price Gouging Act is an appropriate first step to right this wrong, but we’ve got a whole lot more to do.

Congress should pass legislation to empower Medicare to negotiate lower drug prices. It’s unconscionable that we would handcuff patients with higher costs to safeguard corporate profits.

We’ve also got to take a look at the role of other actors, like pharmacy benefit managers and private equity firms, in driving up costs. It’s time we fix this system. Our patients, our constituents, deserve it.

The skyrocketing price of prescription drugs has gone unaddressed for too long. Whether or not we take action is a matter of consumer good versus corporate greed.

It’s time to put patients before profits.

Porter represents California’s 45th District.