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Biden Administration's New Framework to Tackle Prescription Drug 'Price Gouging'

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Medriva Correspondents
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Biden Administration's New Framework to Tackle Prescription Drug 'Price Gouging'

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A Bold Step to Curb Prescription Drug Prices

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In an unprecedented move, the Biden administration has proposed a new framework to address the escalating prices of prescription drugs. By utilizing 'march-in rights' under the Bayh-Dole Act of 1980, the administration aims to control the prices of drugs developed with taxpayer dollars. This strategy enables the government to license drug patents to other companies if the drugs are deemed unreasonably expensive, a move that could radically reshape the pharmaceutical landscape.

March-In Rights for Affordable Medications

The administration's guidance emphasizes that a drug's high price alone is sufficient to trigger march-in rights. This implies that if a medication, developed with public funding, is found to be excessively priced, federal agencies could potentially 'march-in' and break the drug's patent. Such a move would pave the way for generic competitors to produce more affordable versions of the same medication. This is the first time a U.S. administration has explicitly stated that a high price alone could justify breaking a drug's patent.

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Promoting Healthcare Competition

The proposed framework is not solely focused on drug pricing. It also seeks to address healthcare competition, including scrutiny of anti-competitive practices and efforts to tackle corporate greed in healthcare. The Biden-Harris administration believes that taxpayer-funded medications should be reasonably available and affordable. Yet, the 25 largest pharmaceutical companies control around 70% of industry revenues. New research released by the Department of Health and Human Services (HHS) finds that a lack of competition in drug markets is highly correlated with higher prices. The administration is also actively working to stop anti-competitive mergers and practices by dominant corporations in health care markets.

Political Reactions and Industry Concerns

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The new framework has elicited varied responses. Sen. Bernie Sanders, a long-time advocate for affordable healthcare, supports the framework but urges the administration to do more. He cites the example of the high cost of the prostate cancer drug enzalutamide (Xtandi). On the other hand, the pharmaceutical industry, represented by the PhRMA, expressed disappointment in the administration's actions. The industry has raised concerns about the potential impact on patent protections and collaboration with the government.

Lowering Healthcare and Drug Costs

The Biden-Harris administration's new actions to lower health care and prescription drug costs build on previous steps to cap insulin costs and lower the cost of health insurance. The White House believes it can seize the patents of certain expensive drugs to create more competition and lower prices. The administration is also actively addressing anticompetitive practices and corporate greed in health care. Despite opposition from some quarters, these efforts show a commitment to making healthcare more affordable for millions of hardworking Americans.

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