Durbin, Grassley Introduce Bill To Require Price Transparency In Prescription Drug Advertisements

WASHINGTON – U.S. Senate Majority Whip Dick Durbin (D-IL) and U.S. Senator Chuck Grassley (R-IA) today reintroduced the bipartisan Drug-price Transparency for Consumers (DTC) Act, a bill that would require price disclosures on advertisements for prescription drugs, in order to empower patients and reduce spending on medications.  The Government Accountability Office (GAO) recently released a report on the impact of direct-to-consumer (DTC) advertising which found that prescription drugs advertised directly to consumers account for 58 percent of Medicare’s spending on drugs.  The DTC Actwould require DTC advertisements for prescription drugs and biological products to include a disclosure of the list price, so that patients can make informed choices when inundated with drug commercials.  

“Big Pharma spends billions each year to flood the airwaves with commercials that inflate spending by steering patients to the most expensive medications, despite cheaper, more effective drugs being on the market.  What these ads don’t tell you is how much that medication costs.  Patients deserve to know the price of their medication, and a dose of transparency is the prescription Big Pharma needs,” said Durbin.  “Senator Grassley has long been my partner in improving prescription drug price transparency, and with the DTC Act, we are continuing to push for this reform.”

“Knowing what something costs before buying it is just common sense,” Grassley said. “Disclosing the list price of prescription drugs in advertisements is a no-nonsense way to empower health care consumers to make informed decisions about their care. It also spurs competition, which leads to lower prescription drug costs.” 

Each year, the pharmaceutical industry spends $6 billion in DTC drug advertising to fill the airwaves with ads, resulting in the average American seeing nine DTC ads each day.  Studies show that these activities steer patients to more expensive drugs, even when a patient may not need the medication or a lower-cost generic is available.  This practice drives up the cost of health care, while undermining the role of providers.  Studies show that patients are more likely to ask their doctor, and ultimately receive a prescription, for a specific drug when they have seen ads for it.  For these reasons, most countries have banned DTC prescription drug advertising—the United States and New Zealand are the only developed nations to permit this practice. 

Cosponsors for the DTC Act include U.S. Senators Angus King (I-ME), Mike Braun (R-IN), Richard Blumenthal (D-CT), JD Vance (R-OH), and Tammy Baldwin (D-WI).

The DTC Act is endorsed by AARP, American Medical Association, American Hospital Association, American Academy of Neurology, Patients for Affordable Drugs Now, and Campaign for Sustainable Rx Pricing.  Additionally, a Kaiser survey found that 88 percent of Americans support this price disclosure policy for advertisements.

Below are some key findings from the GAO report:

  • Two-thirds of pharma’s spending between 2016 and 2018 on DTC ads ($12 billion out of $18 billion total) was concentrated on just 39 drugs.  During this period, these advertised drugs accounted for 58 percent of Medicare’s spending on drugs ($320 billion out of $560 billion). 
  • In 2019, Humira had $500 million in DTC advertising, contributing to $2.4 billion in Medicare costs.
  • Among the top 10 drugs with the highest cost to Medicare, four were also in the top 10 for advertising spending (Humira, Eliquis, Keytruda, Lyrica). 

For years, Durbin and Grassley have advanced legislative proposals to require pharmaceutical companies to disclose the list prices of their prescription drugs when choosing to run DTC advertisements, including passing a bipartisan amendment through the Senate in 2018.