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Texas Lawsuit Days of Action: Prescription Drug Costs

By June 24, 2020No Comments

We have reached a critical point for the future of American health care and the fate of the Affordable Care Act (ACA). Today, Trump’s Department Of Justice (DOJ) and Republican-led states are submitting their briefs in support of California v. Texas, the lawsuit seeking to strike down the ACA. If President Trump and Republicans have their way, 20 million Americans will lose their insurance coverage, 135 million Americans with pre-existing conditions will be stripped of their protections, and costs will go up for millions. The consequences of the lawsuit for America’s health care are particularly devastating at a time the country is gripped by the coronavirus crisis which threatens the health and safety of the entire nation.

No action would be more damaging to Americans’ health and safety than if the Trump administration achieves their desired goal of overturning the ACA in its entirety during this crisis. When the court hears this case, there will likely be no vaccine and no viable treatment for the virus. When millions of Americans have already lost health insurance due to the pandemic, it’s absurd that President Trump is arguing in court that 20 million more Americans should lose their health care. And when millions of Americans who contract the coronavirus join the 135 million Americans with a pre-existing condition, President Trump will also be arguing in court to allow insurance companies to deny them coverage or charge them more. The submission of these briefs from Republican states will put the Trump administration’s politically-motivated lawsuit on full display for the American people in front of the highest court.

Days of Action: Day 4 of 12 focuses on prescription drug costs. To learn more about our Days of Action, visit our website.

What’s At Stake: Prescription Drug Costs

As millions of Americans are facing the possibility of coronavirus and devastating health care bills, controlling the cost of prescription drugs has never been more critical. It is paramount that patients are able to afford any viable treatments and vaccines when they are available. A recent poll found that 88 percent of Americans fear that drug companies will use the pandemic as an excuse to raise prices. If Trump gets his way and the Supreme Court strikes down the ACA, prescription drug prices will skyrocket as the country continues to battle this crisis. 

Two-Thirds Of Adults Report That Prescription Drug Prices Have Increased Under Trump. “Two-thirds of U.S. adults (66%) report that prescription drug prices have increased either a little or a lot since 2017, the first year of the Trump administration. Self-identified Democrats (81%) and independents (70%) are more likely to perceive an increase in prices than are Republicans (47%), although less than 10% among all three groups see a decline in drug prices during this period.” [Gallup, 4/28/20

Coverage Confirms Drug Companies Are Already Taking Advantage Of The Coronavirus Crisis: 

Axios: Gilead CEO Has “Punted All Questions” Related To New Coronavirus Treatment’s Cost. “Gilead CEO Daniel O’Day has punted all questions related to remdesivir’s price thus far. Gilead is giving away its existing remdesivir supply, which would cover about 140,000 patients, and won’t land on a price until more data comes in. The company is spending ‘up to $1 billion’ on the drug, though it has also received sizable taxpayer investment for remdesivir — dating back to when the drug was tested for Ebola.” [Axios, 5/7/20

  • ICER Suggested That Gilead Could Be Justified In Charging Up To $4,500 Per Treatment Course For Coronavirus Patients. “A study by the Institute for Clinical and Economic Review suggested a ceiling price of $4,500 per treatment course — assuming 10 days—for remdesivir. The report considered that R&D costs for the drug would already have been reclaimed in Gilead’s antivirals that have made it to market, and would not need to be included in the pricing considerations.” [Yahoo Finance, 5/5/20

Axios: Drugmaker Tripled The Price Of A Pill As It Pursued Coronavirus Use. “Going into this year, the list price of a 60-pill bottle of Mytesi — an antidiarrheal medication specifically for people with HIV/AIDS who are on antiretroviral drugs — was $668.52. On April 9, Jaguar Health raised the price to $2,206.52, according to pricing data from Elsevier’s Gold Standard Drug Database. Between the lines: The price hike coincides with the company’s push to get its drug to more patients — specifically those diagnosed with COVID-19.” [Axios, 4/23/20

Associated Press: Gilead Sciences Sought Rare Disease Status For Potential Coronavirus Treatment, Which Is Potentially Worth Millions In Tax Breaks. “The pharmaceutical giant that makes a promising coronavirus drug has registered it as a rare disease treatment with U.S. regulators, a status that can potentially be worth millions in tax breaks and competition-free sales…The FDA granted the status on Monday, according to the agency’s website. If approved for coronavirus, Gilead Sciences would receive seven years of exclusive U.S. marketing for the drug and tax credits on its research and development costs.” [Associated Press, 3/25/20

  • Gilead Sciences Rescinded Request For Exclusivity After Backlash. “Gilead Sciences On Wednesday announced that it has submitted a request to the Food and Drug Administration to rescind the exclusive marketing rights it had secured for remdesivir, an antiviral drug that shows promise in treating Covid-19, the disease caused by the new coronavirus. As The Intercept reported on Monday, the FDA had awarded Gilead seven years of exclusive marketing rights to the drug through the Orphan Drug Act, even though the statute was designed to induce pharmaceutical companies to make treatments for rare diseases that affect fewer than 200,000 people in the United States.” [The Intercept, 3/25/20

If The ACA Is Overturned, The High Cost Of Prescription Drugs Would Only Get Worse:

  • GONE: Rules that increase competition in the prescription drug market and help Americans access cheaper drugs. 
  • GONE: Consumer protections that prohibit drug companies from paying off doctors behind closed doors to influence the drugs they prescribe to patients.
  • GONE: Nearly 12 million seniors will have to pay more for prescription drugs because the Medicare ‘donut hole’ will be reopened.

ACA Repeal Means More Profits For Drug Companies And Higher Costs For Consumers. 

Consumers could be forced to pay more for drugs. The ACA’s Biologics Price Competition and Innovation Act paved the way for the Food and Drug Administration (FDA) to approve biosimilars, cheaper alternatives to expensive biologics. Without the ACA, approval of biosimilars will be in jeopardy, and drug companies may be less likely to invest in new biosimilar drugs. This change will make it harder for Americans to access low-cost alternatives to expensive biologic medications. It will also jeopardize the predicted $54 billion in savings that biosimilars are expected to produce between 2017 and 2026.

Drug companies would once again be allowed to pay doctors behind closed doors (to prescribe drugs you don’t necessarily need). Without the ACA’s Physician Payments Sunshine Act, Big Pharma will once again be allowed to make payments and offer gifts to doctors behind closed doors. When these payments are made with no transparency, they can create conflicts of interest and blur the line between objective and promotional research. The outcome of the Texas lawsuit has the potential to uproot the health care system all while giving drug companies even more power. 

Reopening the “donut hole” would make medications more expensive for 12 million seniors. If the entire ACA is overturned, seniors will have to pay more for prescription drugs because the Medicare “donut” hole will be reopened. From 2010 to 2016, “More than 11.8 million Medicare beneficiaries have received discounts over $26.8 billion on prescription drugs – an average of $2,272 per beneficiary,” according to a January 2017 Centers on Medicare and Medicaid Services report