Let’s Not Make a Bad Thing Worse

We’ve all, or at least most of us I suspect, have heard the saying, “give an inch take a mile” which summarizes the situation where you give in on some point under dispute and the other person expands the freedom to take much more than was envisioned. I think an even more insidious twist on this saying is “give an inch take two inches”. It doesn’t seem like much but in fact the taker doubled the amount that was initially given. If they continue to double pretty soon the taker has overpowered the giver. I can’t see the future, but sometimes I’m stupid enough to make a prediction and when I’m wrong, which is often, I usually stand mute. But when I’m right, I point out the accuracy of my prediction, but in a humble way. Case in point.

When the Inflation Reduction Act was passed four years ago it contained language that gave the government the power to set the price for 10 drugs in 2026, 15 drugs in 2027 and 2028, 20 drugs in 2029 and thereafter. I predicted that these initial numbers would serve as a jumping off point and there would be efforts to expand the program. I even used another metaphor concerning a camel’s nose when I made that prediction. A year later I humbly pointed out that the President’s budget actually voiced the administration’s desire to expand these numbers. I do recognize that while the President’s budget very rarely morphs into law, it certainly signals intent. Since then, there have been multiple pieces of proposed legislation to expand the affected drugs that have thankfully not come to fruition. Unfortunately, there is another attempt coming to light that looks very ominous.

The Senate Finance Committee is looking to expand Medicare drug price negotiations in several specific ways, according to its June 16, 2026, Request for Information. These proposals build on the Inflation Reduction Act (IRA). This expansion will be done in five ways.

1.    Increasing the number of drugs negotiated each year

2.    Negotiating drugs earlier in their lifecycle

3.    Removing exemptions that currently limit which drugs qualify

4.    Using international prices to justify broader negotiation

5.    Extending price control mechanisms beyond Medicare

While increasing just the number of drugs negotiated each year is bad enough this proposal also reduces the time that a drug developer can recover the money spent on R & D and clinical trials. It removes exemptions that were part of the original law for good reasons. It references international pricing to use as a guide and a justification for the broader use of price controls and finally, it threatens to expand these price controls beyond Medicare into the commercial market. The expansion is insidious no more. We gave them an inch and they are threatening to take a mile.

I look at these proposed changes and wonder . . . why would any drug manufacturer want to spend any money to discover a new drug under these conditions. Now I might have exaggerated a tad, but I’ve talked many times about the chilling effect on investors that the initial number of drugs that would be eligible to have their prices fixed. These proposed changes would not only expand those initial numbers, but would negatively affect other aspects of the business model, effectively increasing the risk to investors. It is important to note that we have already witnessed a decrease in investment, especially in small molecule drugs, I am waiting for someone to take a stab at what the impact on finding new drugs these changes would cause.

I’m not going to predict what, if any, of these changes will be made into law. What scares me even more is that some or all of these changes might be accomplished by other means than passing new legislation. The Supreme Court gave the executive branch more power over government agencies and it worries me that there might be new ways to circumnavigate the legislative branch. This seems to be a crucial time for our country’s healthcare. I do have some hope that the midterm elections will dampen some of the enthusiasm for change and push these proposals to the back burner. When your lawmakers return to your state for the summer recess, I hope you take the time to look them in the eye or at least make sure they read or hear how you feel about changes to the Medicare Part D, and Part B, prescription drug program that has been so successful over the years. Attend town hall meetings and write letter - tell them that if it ain’t broken don’t fix it.

One last thing. The World Cup ended yesterday, and it served in some ways to bring us together as a world family. I read multiple articles about how visitors from other countries were very complimentary about how they were received in the United States. Many were somewhat angry with their own country’s portrayal of our country. To me it brought up the old term of the “ugly American” which, in the past, we often deserved. It heartens me to see that often the governments and media of countries around the world say and do things that don’t necessarily reflect the people they govern or write about. I see bumper stickers that just say, “let’s just be nice to each other”.  It gives me hope that through it all people around the world are finding ways to just be nice to each other.

Best, Thair