The Biden administration is claiming authority to seize patents to prevent price gouging of certain medications by the pharmaceutical industry.
The administration unveiled the framework listing factors that government agencies should consider when exercising the controversial policy.
That policy, known as march-in rights, breaks the patents on drugs developed with federal assistance but not widely available to the public. What's changed is that government officials can now consider the cost of a medication for the first time.
Critics say the decision will lead to a decline in innovation and competition within the pharmaceutical industry.
The White House is unmoved, according to National Economic Advisor Lael Brainard: “When drug companies won't sell taxpayer-funded drugs at reasonable prices, we will be prepared to allow other companies to provide those drugs for less.”
Thursday's announcement comes as the presidential election heats up amidst concerns over kitchen-table issues.
As CNBC reports:
The administration's announcement follows a nearly nine-month review of the federal government's march-in rights, which aimed to update the framework for using the policy. It also comes as President Joe Biden makes lowering U.S. drug prices a key pillar of his health-care agenda and reelection platform for 2024.
Political pressure has pushed health-care companies to launch their own efforts to lower drug prices. CVS on Tuesday unveiled a new prescription drug pricing model, which could potentially cut costs for patients at the pharmacy counter.
Nearly three in ten Americans struggle to pay for the drugs they need, according to a July survey from health policy research organization KFF. And some research suggests that U.S. patients spend about $1,200 more per person on prescription medications than those in any other nation.
Yet taxpayers have spent tens of billions of dollars to fund hundreds of drugs in the last decade — which the Biden administration believes could justify more government action to cut prices.
Since its inception over 40 years ago, no agency has used march-in rights. It remains to be seen how government officials will wield their newly acquired power.
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