Hatch: Drug Prices a ‘Major Issue’ for Next Congress

(Rob Kunzig/Morning Consult)

Sen. Orrin Hatch (R-Utah), chairman of the powerful Senate Finance Committee and a longtime ally of the pharmaceutical industry, said Wednesday that drug prices will be a “major issue” in 2017.

While this has long been an expectation among other lawmakers and lobbyists in the health care industry, Hatch is one of the most important players in the drug price fight. Even if the Senate flips to Democratic control, the Finance Committee has jurisdiction over a large portion of the issue, and Republicans are likely to look to Hatch, possibly as ranking member, for cues on how to respond to the loud demands for action.

“The key is to try and get the pricing so it’s reasonable but has all the incentives to create more lifesaving drugs or, in the case of biologics, more cures,” Hatch said.

When asked if some current prices are unreasonable, Hatch said, “Well I know some of them are. I’m not for the government coming in and setting prices. We should let competition do that. But I am for creating as much competition as we can on some of these formulas.”

Hatch’s comments come after weeks of headlines about the price of EpiPens, which rose from less than $100 for a pack of two in 2007 to more than $600 currently. Many lawmakers have expressed outrage over the price increase, and several committees have launched or promised investigations into the matter.

The narrative of a company acquiring an old, off-patent drug and astronomically raising its price is becoming familiar. Case after case making the news has put Republicans, who are averse to government intervention in private markets, in a difficult position.

Now, Democrats are hoping the EpiPen story will be the straw that breaks the camel’s back when it comes to drug price legislation materializing, perhaps even coming law, next year.

“I think the EpiPen may be the tipping point, because it affects so many people,” said said Sen. Richard Blumenthal (D-Conn.), who has been one of the most vocal members on the EpiPen price increases. “The price increases have been so outrageous, ordinary families have to replenish the product every year, and they need it wherever a child goes — school, grandma’s house, at home.

“The cost is really putting this product out of reach for a lot of ordinary families, and I think that may well prompt some action by Congress,” he added.

The pharmaceutical industry has been gearing up for a fight over the issue. An important question is whether congressional efforts, particularly those with a shot of becoming law, focus more narrowly on issues that Big Pharma can attribute to bad actors, or on the drug industry as a whole. The big players in the field would prefer to centralize anger on the “bad actors.”

Hatch didn’t answer directly when asked whether the problem was industry-wide, but he made it clear that companies like Mylan Pharmaceuticals, the maker of the EpiPen, have acted inappropriately.

“I think it’s people taking advantage of the situation, and I don’t know enough about the price structure of some of these companies to really comment, because I haven’t studied that,” he said. “But I worry about people taking advantage of the situation and demanding more money for their products than they deserve, I’ll put it that way. I worry about consumers too.”