The Democrats' latest attempt to ingratiate themselves with progressive voters ahead of election season is a doozy.
On Monday, the House will vote on a bill to expand Obamacare by imposing price controls on prescription medicines. This is, surely, a preview of the fantastical math Democrats will deploy when they try to sell socialized medicine to the American people this fall.
The bill, formally the Patient Protection and Affordable Care Enhancement Act, would allow the Secretary of Health and Human Services to set drug prices, pegging them to 120 percent of the average price paid by governments that impose socialist price controls. Democrats hope this scheme will reduce pharmacy spending here in America -- but in reality, it would reward foreign freeloaders, jeopardize Americans' access to state-of-the-art medicines, and stifle scientific research.
Drug innovation is a risky, costly, and time-consuming process.
Tufts University researchers estimate that each new medicine costs more than $2.6 billion to develop. This figure is so high because most experimental therapeutics never make it out of the lab. And those that do rarely succeed -- fewer than 12 percent of potential medicines that make it into clinical trials are approved.
Beyond this steep dollar figure, drug development takes time. It typically takes several years for a clinical insight to yield anything that has a real-world application – and once the clinical development phase begins, it takes six to seven years for a drug to successfully make it to the marketplace.
These obstacles help explain why the private industry -- and not big government – creates new medicines. These obstacles also explain why America leads the world in biomedical innovation, with American scientists creating two in three of the world's new medicines.
Countries with socialized healthcare systems frequently impose price controls on innovative drugs. Governments flat-out refuse to cover medicines that cost more than an arbitrary limit. If manufacturers want to sell their drugs in those countries, they have to heavily discount them.
This drives research firms and their scientists out of Europe and to America. Indeed, America accounts for just 5 percent of the world's population and a quarter of the global economy -- but funds 44 percent of global pharmaceutical research and development.
Price controls also reduce access to medicines.
Consider Zytiga, a game-changing hormone therapy for men with advanced prostate cancer. This medicine has been available in the United States since 2018 -- but the United Kingdom refused to let patients access it until this June, as it wasn't "cost-effective." The government only reversed course because patients newly diagnosed with advanced prostate cancer were unable to access chemotherapy due to the COVID-19 lockdown.
Stories like this are common in the United Kingdom. The nation's health service routinely denies or delays access to cutting-edge treatments. These stories, sadly, are also common elsewhere.
Look at France, which dictates which drugs doctors can prescribe. While every single cardiovascular therapy invented between 2011 and 2017 was available for Americans, just half were available to French patients.
Canada also restricts access to medicines. While American patients can access 95 percent of all oncology medications launched in the last seven years, Canadians have access to less than two-thirds of those drugs.
Democrats are dreaming if they don't think price controls will result in similar access restrictions here. They are also dreaming if they do not think that price controls would imperil scientific research.
Most medicines begin in laboratories at extremely small biotech companies. These companies depend on financing from investors who are comfortable with risk. Investors will flee biomedical research if they know – thanks to theatrical and misguided policies from Democrats – that they'll never have a chance to recoup their investment and turn a profit.
Perhaps most egregious is that this legislation is coming up for a vote at a time when the entire country is depending on the pharmaceutical industry to get us out of the coronavirus crisis. As of this writing, more than 123,000 Americans have died from COVID-19. Americans will continue to perish – and our economy will continue to sputter – until research scientists develop a vaccine. Considering that every American is craving a "return to normal," it's completely mad that Democrats would decide that now is the smart time to crush the biopharmaceutical industry.
If the consequences weren't so serious, this Democratic gambit would be rather amusing. After all, Speaker Pelosi and her allies are pushing this bill by arguing the imagined savings from drug spending will help "pay for" the stabilization of Obamacare. As if Democrats have ever cared, at all, about the true cost of Obamacare.
Shame on the Democrats. Obamacare shouldn't be expanded -- and price controls on prescription medicines will decimate one of our nation's most innovative industries. Republicans must work to stop this latest insane idea.
Stacy Washington is a decorated Air Force Veteran, an Emmy nominated TV personality, and the host of the nationally syndicated radio program "Stacy on the Right."
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