The United States has a long history of medical and pharmaceutical innovation and leads the world in the development of new treatments and cures. Yet, some policymakers have suggested imposing top-down regulations such as unproven drug importation and index pricing to reduce drug prices. Those actions would put this innovation at risk. The gains were are making today in COVID treatments and vaccines now shine a spotlight on the importance of a market-oriented health care ecosystem that can respond to new and emerging health threats in real-time.
National Association of Manufacturers Vice President of Infrastructure, Innovation and Human Resources Policy Robyn Boerstling explains drug price controls and how they could impact everyday Americans.
What’s the problem with price controls?
Everyone agrees with the goal of reducing the costs of health care—and prescriptions in particular. The question is how to get there. One way we know will not work is via government-imposed price controls or other arbitrary measures. Non-market-based approaches like this are antithetical to the free enterprise system that forms the bedrock of our economy and way of life. Once we allow the government to run negotiations on our medicines, the government will have an even stronger incentive to run our health care—and that is exactly what many who support price controls like this would like to see.
Why is this important now?
We are in a period of tremendous breakthroughs and medical discovery, led by pharmaceutical manufacturers in partnership with the National Institutes of Health, universities and other private groups. Pharmaceutical manufacturers spend more on research and development than any other industry, creating new treatments and cures that have the potential to save and improve millions of lives. In addition to funding R&D up front, pharmaceutical manufacturers also put a sizeable share of their revenue back into R&D so that today’s treatments can help fund tomorrow’s cures. Imposing arbitrary price controls will threaten those investments and undermine a system that is working to save millions of vulnerable people.
How should Congress and the White House approach high drug prices?
There’s no doubt that health care costs have been rising too quickly for far too long for American families. Those costs have contributed to wage stagnation for workers and discouraged other investments in the workplace. But we need to address inefficiency, affordability, improved outcomes and flexibility to drive down health care costs without abandoning market-based approaches. Any solutions should be guided by the four pillars that have made America exceptional: free enterprise, competitiveness, individual liberty and equal opportunity.
That will require a comprehensive approach to the various forces that strain the system, recognizing the importance of innovation as a tool to reduce costs and improve health outcomes. Congress and the White House should support patient access to lifesaving medicines—and the American manufacturers and researchers that deliver them—instead of upending American health care in favor of an uncertain future.