Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020

Floor Speech

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Mr. GRASSLEY. Madam President, a new study showed that from the years 2007 to 2018, prices for, actually, hundreds of drugs rose many times-- many times faster than the rate of inflation. List prices on 602 medicines rose by 159 percent. That would average out to 9 percent annually. After discounts and rebates, net prices increased by 60 percent or 4.5 percent annually. That is 3.5 times the rate of inflation.

These are drugs for multiple sclerosis, cholesterol, rheumatoid arthritis, chemotherapy, diabetes, and many other debilitating and life-threatening conditions. Put into real terms, these price increases mean that if one of these drugs cost $100 a month in 2007, that same drug would cost $259 in 2018.

Meanwhile, you have to consider the working American. Wages for the average American over the same time period increased about 30 percent in the private sector. That means wage growth is about half the rate of the growth of prescription drug prices, even after the rebates and even after the discounts.

For many, increased drug costs are wiping out progress that these workers are making in their wages. Some families are even going backward financially after paying for their prescriptions. This doesn't take into account at all the many other increases in the cost of living from college to housing, to insurance.

Now, we Americans are surely fortunate, aren't we, to see the significant wage growth that we have had in this country for our workers under President Trump--great progress.

The President and Republicans in Congress can rightly take credit for the country's booming economy, but all that wage growth doesn't mean much--or at least as much--if it is spent on the same prescription drug refills every month. That is something that ought to concern every Member of this Congress, and for most, I am sure it does because we hear about it constantly from our constituents. In fact, during this election season, polls show that it is one of the top three or four issues that are most on people's minds.

Let me be clear. These price hikes aren't because the medicines got better or there was a significant increase in research and development. No, this is because the pharmaceutical companies could do it, and in doing it, they could get away with it because, in many cases, consumers don't have a choice; consumers don't have options or alternatives. That is because we don't have a healthy marketplace that drives costs down for pharmaceuticals.

Right now, pharmaceutical companies can essentially charge Medicare whatever they want, and taxpayers don't have much recourse. Right now, every single working American who pays Federal taxes is subsidizing Big Pharma's record profits through the drugs that the Federal Government pays for through various programs like Medicare and Medicaid.

Now, there has to be a solution for this situation, and Ranking Member Wyden and I are working to put some common sense back into this whole system of buying pills. In the Finance Committee, we have passed bipartisan legislation to put an end to unlimited corporate welfare for Big Pharma. The vote of that bill out of committee was 19 to 9--a bipartisan effort.

We are closer than ever to lowering drug prices for tens of millions of Americans, and these Americans have been crying for this help from Congress for quite a few years. But here we are. Big Pharma and its paid allies are out in force trying to kill any reforms that might endanger their profit margins. They are using scare tactics, deploying terms like ``socialism'' and ``price controls,'' as if these subsidies to Big Pharma are not a form of socialism.

I have been around long enough to recognize the political games that are being played now. You see it quite regularly on the television advertisements. So let's set the record straight. The last thing Big Pharma wants is a free market. After all, these were the same folks who loved ObamaCare so much because they knew it mandated another revenue stream for their products. Now, we all know how ObamaCare has turned out. Yet they made a deal with the White House to back that bill.

Now, Big Pharma is also warning that any reforms would hurt research and development. In fact, my bipartisan legislation with Senator Wyden would result in less socialism, a more competitive marketplace, and wouldn't put a damper on innovation. That is according to something that I call ``God'' around here--the independent Congressional Budget Office. These are professional people making these judgments. They judge most all of our legislation, particularly if there is a monetary cost to it.

For those who may not believe a politician, let me point to the work, then, that the professionals at CBO have done on Grassley-Wyden:

First, the updated Grassley-Wyden bill will save more than $80 billion and result in no fewer cures.

No. 2, CBO says it will reduce patient out-of-pocket spending in Part D of Medicare by around $50 billion.

No. 3, CBO says it will reduce premiums by about $1 billion for tens of millions of seniors and Americans with disabilities on Medicare.

No. 4, CBO says that is all on top of out-of-pocket expenses that we put a cap on and an end to the dreaded doughnut hole that has been part of Part D since 2003.

No. 5, we have also, according to the Congressional Budget Office, created a new way to spread out payments for those out-of-pocket expenses so that paying the bills every month becomes a bit easier for those on fixed incomes.

No. 6 and lastly, according to the Congressional Budget Office, the bipartisan Prescription Drug Pricing Reduction Act--that is the title of our bill--would protect taxpayers from being put on the hook for unlimited price hikes that have no basis in a functioning free market.

So, without reforms, big pharmaceutical companies will continue to receive tens of billions of dollars in excess taxpayer subsidies, and they will also have no incentive to keep prices from rising many times faster than inflation.

Currently, prescription drug manufacturers can charge Medicare more and more every year, and they do. When the government is paying and you have entitlement programs, taxpayers are forced to foot the bill. So Grassley-Wyden enacts accountability and ends corporate welfare without harming medical innovations.

Now, Senator Wyden and I are looking forward to reintroducing our bipartisan bill very soon. So far, a dozen Senate Republicans have announced publicly that they support this bipartisan bill. Others will announce their support in the coming days, and a dozen more Republican Senators have indicated to me that Grassley-Wyden is going in the right direction, implying that they would vote for it on the Senate floor. So I am optimistic that we will continue to gain support as Senators learn more.

I was really pleased with President Trump announcing his willingness to sign a bill in his State of the Union message. The next morning, Vice President Pence was on cable TV saying that he supported Grassley- Wyden. Secretary Azar has endorsed the bill. Not only that, but Secretary Azar and a gang of people in domestic policy at the White House have been working with us on this legislation, even prior to its coming out of committee.

So, with all of this work and with all of this support--and with the interest on the part of the voters as being one of the three or four most prominent issues that will determine how people vote--it seems to me it deserves a vote on the Senate floor and very soon. So I am here today to urge my colleagues on both sides of the aisle, if they have any questions about this bill, to visit with me about it and learn how it will help all of our constituents.

The six points I made about the bill based upon what the Congressional Budget Office said about it isn't all that that bill does. There is a lot more to it.

Maybe I had better back up. I have read enough comments of my colleagues--colleagues I haven't even talked to--that said what an important issue this is. So, in one way or another, without even signing on to this bill, without even being on the Finance Committee, it seems like we have all pledged to lower prescription drug prices. So I think we should follow through on that pledge.

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