Jim Jordan And Mark Meadows Warn Drug Companies Not To Cooperate With Congressional Investigation

Drug prices have soared and as Congress begins to investigate, Congressman Jim Jordan and Mark Meadows warn drug companies not to cooperate with a congressional investigation.

Congressional Hearings on Drug Pricing

L-Congressman Jordan R-Congressman Cummings (chair)

The House Oversight Committee is attempting to study how drug companies set prescription drug prices, but Republicans have warned the industry that it may be better for them not to cooperate. 

Republicans on the House Oversight Committee sent letters to a dozen CEOs of major drug companies warning that information they provide to the committee could be leaked to the public by Democratic chair Elijah Cummings in an effort to tank their stock prices.

Cummings requested information from 12 drug companies such as Pfizer Inc., Johnson & Johnson, and Novartis AG in January as part of a broad investigation into how the industry sets prescription drug prices.

“Rep. Jordan is on the absolute wrong side here,” Cummings said in a statement  “He would rather protect drug company ‘stock prices’ than the interests of the American people.”

Cummings seems to be bragging about an “astronomical” impact on drug company stocks. In the context of his statements before and after, he seems to be saying the “astronomical” impact is on taxpayer savings, which justify giving his committee more resources. A minute later he says: “Whatever you all give us, we will give it back in savings by rooting out fraud, waste, and abuse.”

There is no doubt that Pharma stock prices are going to be affected by cost containment measures. PBMs (pharmacy benefit managers) have had a paradoxical effect on drug prices. The PBMs interact with large health plans and hold a large market share of prescription drugs.  Patients most affected by rising drug prices are those without insurance coverage.

The Health 202: Pharmacy middlemen are under scrutiny for pushing up drug prices

The middlemen who negotiate the prices paid by consumers at the pharmacy counter — known as pharmacy benefit managers — face their own Senate grilling tomorrow over the role they play in making drugs more expensive in the United States than anywhere else. 

The story of U.S. drug costs is a hugely complicated one and its villain shifts depending on which part of the drug supply chain is telling the tale. When pharmaceutical executives had their turn at the Senate Finance Committee in February, they characterized the PBMs as the bad guys, complaining that these third-party negotiators don’t pass drug discounts along to consumers but pocket them instead. Yet here’s an important piece of context to keep in mind, one that PBMs are likely to share with senators tomorrow: It’s the pharmaceutical makers who pocket by far the largest share of gross revenue from drug sales. Two-thirds of U.S. spending on pharmaceutical drugs in 2016 were captured by drug companies, while just 4 percent were captured by PBMs.

None of this is new, as we depict another hearing from years ago

Senator Everett Dirksen drug price hearing (circa 1960)

Dirksen, center holding glasses

Republicans Jim Jordan And Mark Meadows Warn Drug Companies Not To Cooperate With Congressional Investigation: