The Alliance

The Weekly Dose | 01.11.19

January 11, 2019 1:13 pm

Despite a government shutdown, it has been a busy week in Washington as Members of Congress rushed to file a flurry of new bills, including several drug-pricing proposals. We are concerned about the consequences of these proposals for patients—and the lack of discussion about those consequences in Congress or the media. More below.


Have questions? Need more info for a story? Email us. We look forward to working with you.



Patrick O’Connor – Executive Director

Rosemarie Calabro Tully – Communications Director




APMI Executive Director Patrick O’Connor released two statements regarding:

 The Welch-Rooney Bill. The Welch-Rooney bill requires the federal government to negotiate Medicare Part D prices even though the Congressional Budget Office has said measures like this wouldn’t generate meaningful savings:

“CBO also noted that the only way to reduce prices would be to threaten access to those drugs the government targets. Supporters of these measures need to be upfront about those tradeoffs.” Read the full statement here.

Price Cap Bill. Bernie Sanders (I-Vt.) and four House Democrats introduced legislation forcing price caps on prescription drugs that match pricing in countries with subsidized medicine. If enacted, this bill would restrict patient access to life-saving medication.

“Most of these bills would impose dramatic changes to our healthcare system that could restrict patients’ access to the medicine they need. … We need to be upfront about the drawbacks.” Read the full statement here.



How Will Falling Drug Prices Affect Investment? According to The Wall Street Journal, drug “pricing trends … actually have moderated of late.” Because few medicines make it to market, drug-company investors require high returns as a result. We explore how lower margins eventually will affect investment and innovation. Read the full blog post here.

One State Has Fired Its Pharmacy Benefit Managers (PBMs). What Are Other States Doing? While drug companies offer generous rebates to make medicine more affordable, the savings often don’t make it into patients’ pockets. PBMs are not required to disclose their savings, and states are getting fed up. Read the full blog post here.

In case you missed them, here are some other recent posts on the APMI blog:

 - The White House Admits Drug Prices Are Falling 

 - What Is ICER?

 - What Is Step Therapy And How Does It Affect Patients?



Drug Price Negotiation Efforts “Require A Little More Thought.” That’s the opinion of Alicia Munnell, director of Boston College’s Center for Retirement Research. Writing at MarketWatch, Munnell explains why the Congressional Budget Office has said price negotiations “would have a negligible effect on public spending.” 

What To Do With Warren’s Plan? Presidential candidate Sen. Elizabeth Warren (D-Mass.) wants the federal government to manufacture drugs. Patients Rising Executive Director Terry Wilcox tells Sen. Warren’s colleagues to reject the proposal and reminds lawmakers that generic manufacturers don’t have to don't need to recoup R&D costs. 

And Just How Would Warren’s Plan Affect Generic Drug Prices? According to The Wall Street Journal editorial board it “would undercut every generic producer on the market, which would reduce the reason to bring any drug to market. This ‘populism’ would result in higher prices.” 

Disconnect In The White House? In Townhall, Phil Kerpen notes a recent White House Council of Economic Advisers report examined “the impact on medical innovation of the U.S. adopting European-style price controls” and found price controls would reduce medical innovation. 

Health Insurers v. Taxpayers. The Wall Street Journal looks at how health insurers pocket profits at the expense of taxpayers.

Does Posting Prices Benefit Consumers? As Kaiser Health News notes, the Trump administration told hospitals to post prices online … and consumers are still confused. Key takeaway: health care pricing is complex and context is important. 



According to National Association of Manufacturers’ Vice President of Infrastructure, Innovation and Human Resources Policy Robyn Boerstling:

“The IPI [international pricing index] model, if implemented as designed, would send a strong signal that future treatments should be more limited for patients and controlled by the government, thereby curtailing the incentive for the development of new cures.” 


According to Robert Graboyesl senior research fellow with the Mercatus Center at George Mason University:

“if pharmaceutical companies fail to recoup the high costs of developing drugs, their stocks will underperform, and investors will take their capital elsewhere.” 



Monday, January 14th – 12:30pm: National Press Club Luncheon – CVS Health President and CEO Larry Merlo

Location: The National Press Club, 529 14th St. NW, 13th Floor, Washington, DC 20045

Topic: CVS Health President and CEO Larry Merlo will discuss how his company plans to address the current challenges in today’s health care system. Overcoming these challenges, Merlo argues, requires transforming the system from within - centering it on the needs of individuals to help them achieve their best health at a lower cost.

Agenda: Merlo will lay out how CVS Health plans to play a significant role in this transformation by rolling out new health care models in communities across the country with pharmacy, health, and consultation services to make care more local, affordable, and easier to use. Lunch will be served in the Club’s Holeman Lounge at 12:30 p.m., with remarks beginning at 1 p.m., followed by a question-and-answer session ending at 2 p.m.

Contact: Lindsay Underwood - (202)-662-7561 ;



Tuesday, January 15th – 12pm: Urban Institute Event, “Using Encounter Data in Medicare Advantage Risk Adjustment”

Location: Urban Institute, 5th Floor, 2100 M Street NW, Washington, DC

Topic: The Centers for Medicare & Medicaid Services has collected encounter data from Medicare Advantage plans since 2012 and has previously announced plans to use that data to recalibrate the Medicare Advantage risk adjustment model. This policy change would require The Centers for Medicare & Medicaid Services to address many policy, technical, and operational issues before implementation. To explore these issues, the Urban Institute and the American Action Forum recently convened a roundtable of leading national experts from academia, industry, and the actuarial community. Join us in a discussion of the summit’s main findings, as presented in an issue brief by researchers from the Urban Institute and the American Action Forum, to be released in tandem with the event.  

Featured Speakers:

Bowen Garrett, Senior Fellow, Health Policy Center, Urban Institute

Douglas Holtz-Eakin, President, American Action Forum

Gretchen Jacobson, Associate Director, Program on Medicare Policy, Kaiser Family Foundation

Tom Kornfield, Vice President, Medicare Policy, America’s Health Insurance Plans

Thomas McGuire, Professor of Health Economics, Department of Health Care Policy, Harvard University

Stephen Zuckerman, Vice President, Health Policy Center, Urban Institute

Contact: (202)-833-7200