The White House Council of Economic Advisers issued a report Tuesday warning that House Speaker Nancy Pelosi’s bill to lower prescription drug prices would have devastating health and economic costs. But health policy experts cautioned that the report itself is a flawed product of questionable methodology and assumptions.
The CEA report warns that Pelosi’s bill “could lead to as many as 100 fewer drugs entering the United States market over the next decade, or about one-third of the total number of drugs expected to enter the market during that time.”
The report also claims that, by limiting access to lifesaving drugs, Pelosi’s bill would reduce American’s average life expectancy by about four months. And, it says, having fewer new drugs on the market would result in worse public health, with an economic toll that could reach as high as $1 trillion a year over the next decade, far greater than the cost savings generated by the legislation. (The Congressional Budget Office estimated in a preliminary analysis in October that parts of Pelosi’s bill, H.R. 3, would save Medicare $345 billion over seven years while resulting in about eight to 15 fewer drugs coming to market over 10 years.)
Health policy experts weren’t buying the new report’s numbers, or its assumption that the drugs that could be lost would be lifesavers.
"This is nonsense," tweeted Stacie Dusetzina, an associate professor in health policy and cancer research at Vanderbilt University Medical Center. "I am not one to throw shade on simple analysis. There are just so many problems here beyond the calculation."
Peter Bach, director of the Drug Pricing Lab at Memorial Sloan Kettering Cancer Center in New York, called the White House report “internally contradictory,” given that that Trump administration has also proposed ideas that would lower drugs prices and manufacturers’ revenues — and, applying the logic used in the report, would therefore also reduce pharmaceutical innovation.
“Either decreased prices = decreased revenues = decreased innovation, or not,” he tweeted. “How that endpoint is achieved (Potus vs HR3) should not matter and yet here apparently one approach scuttles innovation and the other doesn’t. SMH.”
The bottom line: Pelosi’s drug bill isn’t going anywhere in the Republican-led Senate, but if you hear critics attack it as wiping out 100 new drugs, costing $10 trillion or reducing American’s life expectancy, take those charges with a healthy dose of skepticism.