White House bemoans ‘rapidly growing’ drug prices

The White House said Monday that it is “deeply concerned with the rapidly growing prices of specialty and brand name drugs,” a victory for critics of pharmaceutical companies.

The remark came in a summary document for the administration’s proposed 2016 budget, which would give the Department of Health and Human Services (HHS) the ability to negotiate drug prices for biologics and other medications in Medicare Part D.

“I think it’s something we believe will help with the issue of drug prices,” HHS Secretary Sylvia Burwell said during a briefing with reporters. Burwell added that the administration would work with Congress to establish that authority.

{mosads}The proposal would also award brand biologic manufacturers seven years of exclusivity rather than 12, and block additional periods of exclusivity based on minor product changes. These reforms would save $16 billion over 10 years, the document stated.

The Obama administration also proposed to close the coverage gap in Medicare Part D for brand-name drugs by 2017 — three years earlier than currently scheduled — by increasing discounts from pharmaceutical manufacturers.

The pharmaceutical industry has been fighting off criticism that it charges too much for breakthrough drugs, raising costs for individuals, insurance companies and government healthcare programs.

Companies argue that, while cures might cost high sums of money, they ultimately benefit patients and prevent later spending in the healthcare system.

This debate is currently taking place between America’s Health Insurance Plans and the Pharmaceutical Research and Manufacturers of America, trade groups for insurers and pharmaceutical companies, respectively.

In total, Obama’s budget blueprint would spend nearly $4 trillion, exceeding the spending limits introduced under the 2011 budget deal. Officials estimate the budget would cut deficits by $1.8 trillion over the next 10 years.

Read more about the proposal — which includes tax increases on the wealthy and increased spending on infrastructure — here.