Enormous drug company profits are the primary driver of soaring prescription drug prices in America, according to a damning investigation that Democrats on the House Oversight Committee began releasing Wednesday.
The first two reports in the investigation focus on Celgene and Bristol Myers Squibb’s Revlimid cancer treatment, which saw its price hiked 23 times since 2005, and Teva’s multiple sclerosis drug Copaxone, which went up in price 27 times since 2007.
Those costs have little to do with research and development or industry efforts to help people afford medication, as drug companies often claim, according to the probe.
“It’s true, many of these pharmaceutical industries have come up with lifesaving and pain-relieving medications, but they’re killing us with the prices they charge,” said Rep. Peter Welch (D-Vt.) as the hearings began Wednesday. He added that “uninhibited pricing power has transformed America’s pain into pharma’s profit.”
The top Republican on the committee, Rep. James Comer of Kentucky, called the investigation a partisan attack. “These hearings seem designed simply to vilify and publicly shame pharmaceutical company executives,” Comer said.
Much of the drug industry’s profits come at the expense of taxpayers and the Medicare program, are used to pay generous executive bonuses and are guarded by aggressive lobbying and efforts to block competition, regulation or systemic change in the United States while the rest of the world pays less, the reports say.
“The drug companies are bringing in tens of billions of dollars in revenues, making astronomical profits, and rewarding their executives with lavish compensation packages — all without any apparent limit on what they can charge,” committee chair Rep. Carolyn Maloney (D-N.Y.) wrote in a letter attached to the first two staff reports.
Rep. Elijah Cummings (D-Md.), the former committee chairperson who died last October, had launched the probe more than a year ago. It has since produced more than a million documents. CEOs of Teva Pharmaceutical Industries, Celgene and Bristol Myers Squibb were testifying Wednesday.
Amgen, Mallinckrodt Pharmaceuticals and Novartis were scheduled to appear Thursday.
Celgene CEO Mark Alles verified the accuracy of the documents obtained by the committee but stuck with the standard explanations that the company’s pricing is entirely aboveboard and merited.
“The pricing decisions for our medicines were guided by a set of long-held principles that reflected our commitment to patient access, the value of a medicine to patients in the health care system, the continuous efforts to discover new medicines and new uses for existing medicines and the need for financial flexibility,” Alles said. He said that in 2018 Celgene “committed to full pricing transparency by limiting price increases to no more than once per year,” pegged to Centers for Medicare & Medicaid Services’ projected national health expenditures.
Teva CEO Kåre Schultz demurred from addressing specific questions about much of the report, saying he took over only in 2017, in part to repair a company suffering after its Copaxone patent finally expired.
He also sounded the familiar refrain that prices