Affordable Medicine

Initiative to reduce high prescription drug prices through market competition

Legislation requires product licensing of essential prescription drugs, disclosure of manufacturing costs

Washington, DC – In an effort to make prescription medicine more accessible and affordable for people across the country, U.S. Congressman Sherrod Brown (D-OH) today introduced an initiative that would use market competition to reduce the high cost of prescription drugs. Brown, the top Democrat on the Commerce Health and Environment Subcommittee, said his proposal would implement product licensing of patents on essential medicines whose high prices are a detriment to public health.

“Drug companies have scored a triple-double. They get huge tax breaks, most research and development is publicly funded, and drug firms’ charge the highest drug prices in the world. American drug companies have had it good for a long time. But these good times have been at the expense of people who cannot afford to pay absurdly high prescription drug prices. We must protect public health and make essential prescription drugs more affordable,” Brown said.

“This bill lowers drug prices through competition, not price controls. It also will help a child from a low-income family or a senior on a fixed income afford medicine prescribed by a doctor,” he added.
Brown’s Affordable Prescription Drugs Act would allow consumers to obtain lower prices through competitive, rather than monopolistic, pricing. Under certain conditions — if a prescription drug provides a substantial public health benefit — the federal government could require drug manufacturers to license their patent to generic drug companies. Competitors would be permitted to market new drugs before patent expiration, paying the patent holder royalties for that privilege. Under the bill, individuals or citizen groups can request the Secretary of Health and Human Services to determine that compulsory licensing of a patent-protected drug should occur.

The legislation also would require drug manufacturers to publicly disclose audited financial information relevant to the pricing of their drugs. This provision will allow consumers information to assess the reasonableness of drug companies’ pricing. If a drug manufacturer fails to comply with this provision, it would be ineligible to participate in federal health care programs, including Medicare, Medicaid, and veterans health care.

“The drug companies must understand how important their products are for the American people, especially the elderly. They’re not selling VCRs or furniture, where people can look elsewhere for a less expensive product, or simply go without. We’re talking about health care, and the fact that people often can’t live without these drugs,” Brown said.

Brown said his bill is necessary because drug companies charge Americans higher prices — in many cases twice as high — than the citizens of any other industrialized nation. He said an average dosage (60 tablets) of Zocor, which treats high cholesterol, costs $44 in Canada and a $102 in the U.S. In addition, one month’s supply of Tamoxifen, which treats breast cancer, sells for $156 in the United States compared with only $12 in Canada. Brown also noted drug company profits outpace those of every other industry by at least 5 percent and that drug companies spent $8.3 billion on marketing and advertising last year.

“Prescription drug prices can be reduced and not affect drug firms’ research and development capabilities or their advertising budgets. But these prices cannot remain high without seriously affecting public health and fueling unsustainable health care inflation. Our goal is to ensure working families and low-income people obtain access to prescription drugs,” Brown said.

Brown today joined Reps. Tom Allen (D-ME), Marion Berry (D-AR), Janice Schakowsky (D-IL), and Dennis Kucinich (D-OH) in unveiling the measure at a Capitol Hill press conference.