Placing a price cap on drugs doesn’t provide a real solution, or even tackle the real problem
Cramped within a laundry list of lofty proposals and near-impossible to achieve agenda items, Tuesday’s State of the Union saw President Joe Biden speak about a kitchen table issue that has plagued Americans for years. Biden, like many before him, said he wanted to do something about the price of drugs, such as insulin. But nothing he proposed shows he even understands the problem leading to high prices, much less knows the right solution.
As former FDA Commissioner Scott Gottlieb pointed out Tuesday, the net price of insulin (what insurers and other payers pay after rebates and discounts) has dropped 41 percent since 2012, to around $52. However, the marketplace for drugs is so broken that patients don’t receive those discounts at the pharmacy counter. Patients who haven’t yet reached their deductibles often have to pay the list price, which has risen 140 percent in the same amount of time, to more than $350.
If Biden wants to help lower drug costs for Americans, he should insist that discounts pass through to patients at the pharmacy counter. A Trump administration rule would have taken a big step toward making this a reality, but it was delayed as part of the infrastructure bill that Biden bragged about in his speech. One hand robs the other.
Click here to read more about the problem with President Biden’s proposal.
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