Durbin Highlights Drug Pricing Bills To Tackle Big Pharma, Lower Costs For Patients

PEORIA -- U.S. Senator Dick Durbin (D-IL) today joined doctors and patients at UnityPoint Hospital to discuss recent legislation he has introduced to combat the skyrocketing costs of prescription drugs for American patients, providers, and taxpayers. This year, Durbin has introduced new legislation to help prevent sudden, outrageous price hikes for prescription pharmaceuticals, as well as a bipartisan bill to save billions in wasted spending due to oversized drug packaging. Durbin also highlighted his efforts to lower the cost of insulin for patients with diabetes. 

"Patients in America should not be forced to pay four times what a patient in Canada pays for a life-saving mediciation that was first discoverd nearly a century ago. And patients in America should not face higher drug costs because Big Pharma chooses to sell their expensive  drugs in excessively large drug vials that unnecessarily are going to be wasted,” Durbin said. “I’ve introduced bills that take common sense steps to reduce the soaring prices of prescription drugs for Americans. It’s long past time Congress puts patients before Pharma, and I hope 2019 will be the beginning of real change.”

FLAT Prices Act

Last month, Durbin introduced the Forcing Limits on Abusive and Tumultuous (FLAT) Drug Prices Act, which aims to prevent pharmaceutical companies from hiking the price of prescription drugs, by reducing the government-granted monopoly period for medications if their prices are significantly increased—which would enable lower-cost generic drugs to come to market earlier.

Currently, pharmaceutical companies are awarded “monopoly periods” of five to 12 years by the U.S. Food and Drug Administration (FDA) for new drug approvals. During this time, FDA agrees not to review cheaper, generic alternatives. Too often, pharmaceutical companies use this monopoly period—where no generic competition is allowed—to bilk taxpayers and patients with excessive price increases.

The FLAT Prices Act would reduce this FDA-granted exclusivity period for a drug whose price increases more than 10 percent in a year, or similar amounts over a multi-year period. Drug manufacturers would be required to self-report their price spikes to the Department of Health and Human Services (HHS), and they would have the opportunity to provide an appeal to justify such a price increase. Failure to report such a price hike would incur additional reductions in market exclusivity.

REFUND Act

Last month, Durbin also introduced a bipartisan bill that would reduce the egregious wasted spending on discarded medications that are the result of excessively large, single-use drug vials. The Recovering Excessive Funds for Unused and Needless Drugs (REFUND) Act would enable Medicare to recoup money from drug companies who were paid for wasted medications, and provide savings to seniors enrolled in Medicare.

Each year, Medicare and private health insurers waste nearly $3 billion on cancer medications that are thrown out because the drugs are packaged in vials that hold too much for most patients. In fact, a report that Durbin requested in 2016 from the Inspector General of the Department of Health and Human Services (HHS) found that—for only 20 drugs—Medicare paid $195 million between 2013-2014 for medication that was discarded because it was packaged in oversized single-use vials.

Most of these medications are available in other countries in vials containing smaller quantities. Because of the 20 percent coinsurance that Medicare beneficiaries pay for these drugs, America’s seniors are also paying out of pocket for these wasted drugs.  This issue will only become more pronounced with the explosive growth in high-cost, specialty cancer medications. 

The REFUND Act would require: 

• HHS Secretary to aggregate the total discarded amount of Part B medications each quarter.  This data is already reported on Medicare Part B claims sent by doctors; 
• HHS Secretary to calculate the total cost of the discarded medications, based off the Average Sales Price (or Wholesale Acquisition Cost if not available); 
• HHS Secretary to notify the drug’s manufacturer that they are required to provide a rebate to HHS for 90 percent of the amount of discarded medication that was recorded.  This rebate would be deposited to the Medicare Trust Fund (failure by a manufacturer to provide a timely rebate would incur civil monetary penalties); and,
• HHS Secretary to establish a tracking and payment system to reimburse Medicare beneficiaries for their 20 percent coinsurance share of the cost of discarded drugs

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