Executive Calendar

Floor Speech

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Mr. CASSIDY. Mr. President, I, too, come to speak today regarding pharmaceutical costs and what we can do to make lifesaving medications--and sometimes these medications make our lives a little bit better--more affordable to the average American.

I happen to be a doctor, and I will approach these remarks as a fellow who has seen medicine evolve, who has seen the incredible, positive benefits of pharmaceutical innovation, but also as a doctor who sometimes saw that patients were unable to afford innovation. The question in my mind is, How do we give the patient the power to afford these innovative medicines, because if she cannot afford them, it is as if the innovation never occurred, and for her, it never did occur. So give the patient power.

Let me make some remarks about pharmaceutical companies. There are some incredible examples.

When I was in medical school, cutting away a part of one's stomach-- not the belly but part of the stomach; as I would tell patients, where the food goes after you swallow it--cutting away a part of the stomach because of ulcerative disease was one of the most common procedures done in surgery. Then histamine blockers came along, H2 blockers. Cimetidine was the first. All of a sudden, a surgery that was done multiple times a week was scarcely ever done. Those medicines are now sold over the counter.

This morning, I got a little bit of arthritis, so I took my nonsteroidal anti-inflammatory, which used to be sold by prescription and now is over the counter, along with my H2 blocker, my Pepcid, which used to be sold by prescription but now is over the counter. I take them in the morning, and my back feels better. All of these are medicines that are generic, routine, and we almost--in fact, we indeed take the innovation for granted.

I can go on. I am a liver doctor. Hepatitis C used to be an incurable disease which, in a certain percentage of those affected, would lead to cirrhosis, vomiting blood, liver cancer, and death. Now hepatitis C is cured by taking pills for several weeks. Amazing.

Human immunodeficiency virus, AIDS. When I was in residency, if you got HIV, you died. There was no cure whatsoever. Now people live with it for decades. It is a disease you live with but do not die from. We speak of actually now developing cures for HIV.

That is the promise of a vibrant pharmaceutical industry--people who not only live when otherwise they would have passed away but who also have a better quality of life.

Now, that said, if the patient doesn't have the power, the patient has no leverage in this situation.

I was recently with others in a conversation with the new head of the Congressional Budget Office. The CBO head said: You know, everybody has leverage in the healthcare marketplace except the patient. Everybody has leverage but not the patient.

That is so true. Let me give some examples of how the patient lacks leverage in the pharmaceutical marketplace.

First, I will say, if I go to church--and I do go to church regularly--and there is a Bernie Sanders supporter yanking on this lapel and a Donald Trump supporter yanking on this lapel and they are complaining about the same thing, they are talking about either surprise medical bills or the high cost of drugs. It is something that touches each American, but it doesn't have to be that way.

Consumer Reports did an article over 1 year ago now in which they sent secret shoppers out to retail pharmacies to buy five generic medications, a prescription for each type--again, generic, like the over-the-counter pills I am taking. They went, and they paid anywhere from $66 to $900 for the same five drugs. Now, we can assume that the acquisition cost was about 60 bucks, because you could buy it someplace--an independent pharmacy or online--for $66, but three or four chain pharmacies were charging $900 for medications that they could acquire for less than $60.

You could argue, why did the patient pay? Because we have so little advertising, if you will, cost competition, on what a generic medicine would cost. So imagine you have a health savings account, and you are going to buy your prescriptions, and you get charged $900 for something that should cost $60. This is the situation in which the patient has no leverage.

By the way, you can ask, why didn't insurance cover it? It is because these patients were posing as uninsured. So the chain pharmacy figured out that it is the uninsured who do not have somebody working on their behalf who are going to be the most ripe for the picking for the high prices. The uninsured are the ones we are going to exploit, the ones paying cash. That is wrong. That is not the patient having the power; it is the patient being used as a victim.

There are other things we can see. One is called evergreening. You have a drug, and you make just a little bit of a tweak to it that doesn't improve its importance or the efficacy of the drug--no clinical benefit--but it extends the intellectual property protections. Now laws that were conceived of and passed by Congress to reward innovation and to encourage creativity are instead being used to stifle competition and to extend patent lives so that we, the patients and the taxpayers, have to pay more--not for innovation but, rather because, somebody figured out how to evergreen it.

So on the one hand, I am going to praise pharmaceutical companies for lifesaving drugs that have meant so much to me, my family, and everyone who is listening today, but I must also ask, why should we reward that which is not innovative but which is merely arbitraging laws meant to encourage innovation? We should not encourage arbitraging laws.

There are other issues, such as patent abuse, where companies file large numbers of patents on parts of their drugs that are not innovative but are byproducts of the production process in order to keep out competition; citizen petitions, which typically come on 6 months before a drug is about to become generic, so all of a sudden, we have all these petitions that must be navigated by the companies seeking to introduce the generic; and the rebate system, which works to preserve market share but also to increase prices and to keep them high so patients do not benefit from competition.

If we are going to say the patient should have the power in order to have lower prices, we can say right now that the system seems to be aligned against the patient.

What can we do? Well, my office and others have several proposals in the current pieces of legislation going through, such as the so-called real-time benefit analysis. A prescription is ordered for a patient. The patient scans a barcode, and it would say: At this point, with your deductible and your copay, this is how much this drug is going to cost you, but there is a generic available, and you can get that generic instead. That would be a real-time benefit analysis that would save the patient money.

We just talked to the folks at Blue Cross California. They are coming up with so-called gainsharing. If a patient selects a lower cost medication, the patient receives some of the savings that would otherwise have all gone back to the insurance company--another great idea. Senator Braun was speaking about the patient having skin in the game. In this case, there will be skin in the game because the patient shares the benefit with the payor for being cost-conscious. That is the patient having the power.

We can also add value-based arrangements, which pharmaceutical companies, to their credit, have proposed. If you are the pharmaceutical company, you get paid only if the medicine works. If the medicine doesn't work, you don't get paid. If it does work, you do. That is a value-based arrangement. We have a bill with Senator Warner that would do that.

I would also mention attempting to cap Part D exposure. If there is a senior citizen who is in the catastrophic portion of her policy, then you can cap the amount the senior might be exposed to. Under current law, she might be paying 5 percent of $100,000 worth of medicine. She is taking an essential drug to treat cancer, and she is paying 5 percent of that $100,000, in addition to 5 percent of the other medications she is receiving. This is something many seniors cannot afford and this is something we as Congress can find mechanisms by which we can cap that exposure but still hold taxpayers whole.

We have to enhance existing markets. As you might guess, my theme is that we should enhance it in terms of giving the patient the power, but we also have to preserve the innovation that has led to the great drugs I spoke about earlier. If all we do is steal intellectual property from the pharmaceutical companies, we will lose these innovative drugs. But, again, we need to have the drugs affordable for the patients. This is the tension--promote innovation but ensure affordability.

We have a number of solutions, such as those I have just mentioned, in the HELP Committee and now in the Finance Committee. Republicans have solutions. My office continues to work on those. I look forward to working with my colleagues on their implementation.

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