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Government price limits not the answer for costly medication

Before patients ever walk into pharmacies, they rely on a doctor to diagnose their ailments correctly. We take that for granted. But when it comes to curing what ails our health care system, including the cost of medicines, some in the Maryland legislature are misdiagnosing the problem and prescribing the wrong solution.

There’s an effort to give a newly created board the broad power to decide whether the price of a medicine is justified and to arbitrarily set prices in the state of Maryland. We share the goal of making it easier for Marylanders to afford their medicines. But this government power grab is more than just ineffective — as The Sun acknowledges, it might even be unconstitutional.

We are living in a new era of medicine, benefiting from breakthrough treatments that would have been considered science fiction just five years ago. And the same biopharmaceutical researchers developing these remarkable innovations also know their efforts aren’t nearly as meaningful if they’re too expensive for the patients whose lives depend on them.

Government price limits sound good on paper. It’s an easy political talking point. But we won’t truly help patients unless we first properly diagnose the problem they face. Today’s system forces patients to bear far too much of the burden for a medicine’s cost.

Americans with a deductible, for example, pay 50 percent more out of pocket for brand medicines than they did in 2014. How is that possible when spending on retail medicines went up less than half of 1 percent in 2017 — the slowest growth rate since 2012 — and when net prices for brand medicines are rising slower than inflation?

The answer is that insurers and middlemen like pharmacy benefit managers get to determine what patients pay out of pocket — which means that they are the ones deciding what treatments a patient can afford. But the bill passed last week by the Maryland House and one that is now before the state Senate don’t address those price setters’ power, which is why they’re so misguided.

In practice, these bills provide no certainty that any individual patient will actually pay less for their medicine. It would be a shame if, in search of a quick fix to cap costs, a law passed by the legislature instead limited researchers’ innovations and patients’ access to that new science.

Price controls on vital prescription medicines unfairly target Maryland patients who need access to innovative treatments, and worse, the House version singles out state employees who rely on state and local government health plans. Far from saving them money, as the bills’ promoters promise, it leaves their treatment options in doubt.

The House rushed the bill through without much consideration; it isn’t even clear how such a plan could be implemented successfully. A board with broad authority to set prices often leads to delays and other challenges for patients who need access to critical medicines like cancer treatments.

Yes, the system needs to change. Yet reforms should be judged against this simple test: Do they account for the real reason costs are high? A true solution would take into account the actual factors that influence what patients pay at the pharmacy counter and make sure that the big rebates insurers and middlemen enjoy are passed along to patients. If Maryland wants to lead on drug prices — and we hope it does — it can start there.

At its core, the real question is what kind of health care system we need for this new era of medicine. America’s biopharmaceutical companies’ answer is to make sure patients benefit from a competitive marketplace where medical discoveries are not only achievable by scientists but accessible to patients.

I am inspired by the medical discoveries and innovation happening in biopharmaceutical labs every day. But we can’t realize their potential if patients can’t afford it. Let’s work together to fix our health system where it’s broken, not by recycling bad ideas that sound good. Let’s have an honest discussion to make sure that in our health system, cost is no longer a barrier to a better, healthier life.

Stephen J. Ubl (Twitter: @steveubl) is president and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), which represents America's leading biopharmaceutical research companies.

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