Candidate Joe Biden promised to tackle out-of-control drug prices. “I’m going to reduce prescription drugs by 60 percent, and it’s true,” he announced in November 2020. But there’s a difference between his campaign promises and his team’s actions—or inaction. Prominent example: Health and Human Services Secretary Javier Becerra, who has so far used his administrative power to control drug pricing in such a way that he himself has supported both as a member of Congress and as the California Attorney General.
Much of the ongoing political debate about reducing the nation’s exorbitant drug prices has focused on whether Congress will authorize Medicare to use its purchasing power to negotiate more reasonable drug prices. . In the meantime, however, Becerra’s office has the power to license patented pharmaceutical products with federal funding. In July, lawmakers sent a letter to Becerra’s office calling on the secretary to investigate using these so-called “march-in” rights to control drug pricing.
Use “everything possible”
March-in rights were established under the Beh-Dol Act of 1980. They give federal agencies the power to revoke exclusive patent rights for products developed with government funding in special circumstances—in which “action is necessary because the contractor or assignee has not taken, or within a reasonable time period of such use.” the area is not expected to take effective steps to achieve practical application of the subject invention” and when “action is necessary to reduce health or safety requirements that are not reasonably satisfied by the contractor, assignee, or their licensee.” “
The federal government has never exercised those rights in the 40 years since the law was signed.
Letters of July, sans Elizabeth Warren, D-Mass., and Amy Klobuchar, D-Min., as well as Rep. Lloyd Doggett, D-Texas, noted that federal funding has “contributed to the development of hundreds of drugs, some of which are protected by major patents that may be subject to march-in rights.”
“HHS should consider exercising march-in rights when drugs face limited competition or market practices have failed to ensure an affordable price, ensuring that drugs invented with taxpayer dollars cannot be sold.” Reasonably priced and affordable,” read the letter.
The demand is in line with the positions Besera has taken in the past. Exactly a year earlier, Becerra, California’s attorney general, was one of a group of state attorneys general to sign a similar letter to Donald Trump’s HHS secretary in a march asking him to increase supplies of Gilead Sciences’ remdesivir. – These rights were urged to be exercised. at an affordable price. The drug to be used as a COVID treatment was developed with public funds. The missile, which prompts Gilead to choose “to place its profit margin over the interests of Americans suffering in this pandemic”, called on the government to use “every possible tool” during “this unprecedented crisis”. .
Becerra and his colleagues note, “If Americans who need remdesivir find themselves unable to afford a treatment course, federal agencies will have access to both Gilead’s background patents and patents resulting from contract work.” There is sufficient reason for the need for ‘licensing’. Beh-dol Act.” This was not the first time Becerra had called for such a move. Four years ago, Becerra, a US congressman and chairman of the House Democratic Caucus, was one of 51 House Democrats who urged Barack Obama’s HHS to use march-in rights to lower drug prices.
“The failure to act in the past has undoubtedly sent an unfortunate signal that the prices of federally funded inventions may be set as high as a sick or dying consumer,” laments the letter.
Becerra’s co-signers at the time included Doggett.
While Becerra has yet to commit to using march-in rights to drive down drug prices, in September his office published a report flagging march-in rights as a tool at his disposal. issued. The report called on HHS, the National Institutes of Health and other agencies to exercise march-in rights and pledges “to give due consideration to such petitions.”
Becerra’s office did not respond to a request for comment.
“a devastating blow”
Meanwhile, the pharmaceutical industry is trying to dissuade the administration from using such tools to cut into its profits.
The Beh-Dol Coalition—an organization backed by powerful pharmaceutical lobbying groups and a branch of the US Chamber of Commerce—is pressuring the White House to oppose march-in rights.
“The Coalition will educate lawmakers to ensure that the Act is used as envisioned by Senators Birch Beh and Bob Dole,” said a press release announcing the launch of the Coalition in February 2020.
Coalition members recently wrote op-eds and engaged in lobbying to block the federal government from using its ability to manufacture patented products developed with taxpayer money.
The Coalition executive wrote, “Allowing the government to proceed because one believes the price the company charges for its treatment is not ‘fair’ – a completely undefined term – for the US economy and would be a devastating blow to the health of Americans.” director, Joseph Allen, in an op-ed on the health care news site State last month.
“Since then [Bayh-Dole’s] Enactment, America has become the world leader in innovation,” Allen continued, arguing that if the federal government used its march-in rights under Beh-Doley to reduce the cost of prescription drugs, So it will stop drug development.
Allen’s claim about the risks of drug innovation was refuted by a recent Congressional Budget Office study, which concluded that even if profits on top-selling pharmaceuticals declined by a quarter The number of new drugs entering the market will decrease over the next decade. Only 0.5 percent.
Some members of the Bayh-Dole Coalition are advocating the law directly, including drug industry lobbying groups, the Pharmaceutical Research and Manufacturers of America. (PHRMA), the Biotechnology Innovation Organization and the California Life Sciences Association, according to lobbying filings from the first two quarters of this year. Pharmaceutical companies, including Merck Sanofic, and Bristol Myers Squibb are also lobbying for the law.
A potential obstacle to Becerra exercising the government’s march-in rights is an eleventh-hour Trump administration rule that would have barred the federal government from using the law as a means to control prices.
In early January 2021, the National Institute of Standards and Technology (NIST), part of the Department of Commerce, proposed a rule under Beh-Dole that “march-in rights not to be exercised exclusively on the basis of a contractor’s business decisions.” in relation to the pricing of commercial goods and services arising out of the practical application of the invention.”
Biden’s Commerce Secretary Gina Raimondo has not finalized the rule. When asked during her confirmation hearing by Sen. Tammy Baldwin, D-Wis., whether she intended to repeal the rule, Raimondo took no stance, saying only that she would work with Baldwin on the issue. In a July executive order, Biden urged Raimondo to “consider not finalizing any provision on march-in rights and product pricing” in the proposed Trump regime.