The largest drug lobbying firm, PhRMA, took to social media to denounce Medicare's drug pricing negotiation list.
The firm's X (formerly Twitter) account reposted the White House tweet announcing the first 10 drugs on the roster for negotiation, saying the Biden Administration is "giving a single government agency power to arbitrarily set medicine prices with little accountability, oversight or input from patients and their doctors — with consequences long after this administration is gone."
The PhRMA tweet has more than 1.4 million views and thousands of comments. X/Twitter users were quick to point out the hypocrisy of the post, saying the drug companies are also single entities that arbitrarily set medicine prices.
"As opposed to the current system, where you arbitrarily set medicine prices high enough to satisfy your shareholders and pay your CEOs obscene salaries?" wrote @joekatz45.
Another user, @DrMattDSW, wrote, "lmao when did we ever have input into our (outrageously expensive) Rx prices? Never. We’ve never had input. And considering how much research is funded by the government (which means through our tax dollars) I am more than okay with lower prices for everyone. Get bent."
What @WhiteHouse isn't telling you: They're giving a single government agency power to arbitrarily set medicine prices with little accountability, oversight or input from patients & their doctors—with consequences long after this administration is gone. https://t.co/t5UeVnWftr https://t.co/YnGpmUUDl4
— PhRMA (@PhRMA) August 29, 2023
Yahoo Finance spoke with a half-dozen health policy experts about the backlash, which continued to escalate late Wednesday — more than 24 hours after the post was published.
Andrew Mulcahy, senior health economist at The RAND Corporation, said the tweet was a little off-target — especially in claiming that the government was arbitrarily setting prices without input from patients and doctors.
"Congress was very specific in the IRA [Inflation Reduction Act]. There is a very long guidance document that HHS [Health and Human Services] put out that got commented on, and revised. It's hard to say that they're doing it without patients and doctors," Mulcahey said.
Anna Kaltenboeck, a former senior health adviser on the Senate Finance Committee who helped write the IRA, reposted the tweet from PhRMA and "fixed" it to reflect support for the law.
"They are railing against a policy that more than 80% of Americans agree with ... that's both Democrats and Republicans. So if you have that level of unity on an issue and we are this divided as a country, on a partisan basis, that tells you something," Kaltenboeck, principal and head of drug reimbursement at healthcare research firm ATI Advisory, told Yahoo Finance.
Larry Levitt, executive vice president for health policy at KFF, said the social media post was a sign of how aggressively the industry is fighting negotiations.
"The fact that the drug industry is continuing to fight this shows they’re worried that it’s a foot in the door for broader government price-setting powers. I have to believe PhRMA is hoping for a Republican sweep in 2024, with the potential to roll back or slow down price negotiation," Levitt said.
Michael Sinha, assistant professor of law at St. Louis University of Law, agreed. He said that though the Congressional Budget Office estimates show low impact to innovation and drug R&D, the industry is still looking to rally support to overturn the IRA if the upcoming election gives it a favorable political environment to do so.
"PhRMA doesn’t want to go down without a fight. It is used to winning," he said.
Legal battle ahead
Pharmaceutical companies have filed more than a half-dozen lawsuits in various districts around the country, in what some analysts say is an attempt to fast-track the issue to the US Supreme Court. And more are expected. The lawsuits allege the powers granted to Medicare by the Inflation Reduction Act to negotiate prices of the most expensive single-source drugs are unconstitutional.
They cite the First Amendment, or freedom of speech, alleging the companies are being forced into the negotiated pricing process; the Fifth Amendment, or unlawful government seizure, alleging that Medicare is taking the drugs at the negotiated price; and the Eighth Amendment, or excessive fines, for the fines Medicare can levy for noncompliance.
Sinha said the suits are "bizarre" and would set a dangerous precedent if the industry wins. KFF's Levitt said the outcome is still uncertain.
"The pharmaceutical industry may yet be successful at using the courts to stop government negotiation of drug prices, but I think they're going to have a tough time winning over the public. Giving the government authority to negotiate drug prices in Medicare is enormously popular across partisan lines, and the public doesn't buy the arguments against it," Levitt added.
The Biden Administration has similarly said it will be hard to put the cat back in the bag.
"It's important to remember that basically what pharma is arguing in these court cases is that they should have no limit to be able to charge whatever they want, and that is exactly why Americans support Medicare drug negotiations," said Biden's domestic policy adviser Neera Tanden on Tuesday.
Kaltenboeck said she is confident the law will stand up in court.
"We tried our very best to make this thing as navigable as possible for all the stakeholders involved, and clear as possible," she said.
Tanden noted that given that the negotiation process is happening publicly, with the prices published next September, it will be hard to repeal the Inflation Reduction Act — just as it has been to repeal the Affordable Care Act — and to "claw back these benefits, these lower prices," Tanden said.
A health economist, who was not authorized to speak to media, said there could be negative ramifications to the economics of drug research with this move by the administration.
"Overall I find the whole discussion about this being 'popular' or 'polling well' a bit silly. Unsurprisingly, people like paying less for something. And we aren’t forcing people to consider that they are also going to pay for low prices today with fewer drugs in the future," the economist said.
Dr. Reshma Ramachandran, an assistant professor of medicine at Yale University, said the lobbying firm's tweet showed how tone-deaf it was to the majority of public opinion.
"Nearly 20 years ago, PhRMA pulled the biggest hoax on the American people in successfully lobbying Congress to not negotiate reasonable prices of drugs as almost every other similar country does. This is long overdue and this tweet and their lawsuits make clear that PhRMA continues to prioritize maximizing their profits instead of patient access," she said.
Kaltenboeck added that the industry has no obligation to offer its products through Medicare, and has for too long been forcing Medicare to sell at whatever prices they set.
"You don't have to sell your drugs to Medicare, there is no Constitutional obligation. So they are free to avoid the program," she said.
PhRMA declined to comment.
Follow Anjalee on Twitter @AnjKhem.
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