Drug Price Controls Are Bad Policy. Congress Should Instead Double Down on Innovation to Boost Productivity in Biopharma R&D
Capitol Hill is awash in proposals to stem allegedly out-of-control drug prices, but in their zealousness to rein in drug prices, policymakers risk imperiling drug innovation to the detriment of patients and the economy. As Stephen Ezell writes in Morning Consult, the better way to produce more medical cures at lower cost over the long haul will be to double down on innovation, not deter it.
- Peer-reviewed scholarly studies find that reducing drug revenues decreases R&D and new drugs. The converse is also true—lifting drug price controls increases the number of new treatments available, increasing life expectancy and lowering overall health-care costs.
- Instead of slashing drug prices on the dubious theory that it will only lower profits for biopharma companies, not lead to fewer new medicines, lawmakers should look at the other side of the industry’s ledger—the growing cost of developing drugs.
- It takes at least a decade of research and development and clinical trials to develop an innovative new drug, and the average cost for large drug companies nearly doubled over the prior decade from $1.19 billion to $2.17 billion.
- The way to radically improve drug-industry productivity is by spurring innovations such as AI, CRISPR gene editing, and advanced biologics manufacturing processes.
Lawmakers’ actions this fall will determine the trajectory of the U.S. biomedical innovation engine for years to come. Policymakers should focus on maintaining an environment that produces cures for present and future generations alike.