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House kicks off drug pricing, manufacturer merger oversight


Capitol Hill lawmakers started out the third week of the new Congress with drug manufacturers on the brain: specifically, oversight of drug-pricing strategies and antitrust scrutiny of the proposed $74 billion Bristol-Myers Squibb acquisition of Celgene Corp.

House Committee on Oversight and Reform Chair Rep. Elijah Cummings (D-Md.) kicked off his promised probe of manufacturers on Monday. Last week he scheduled a Jan. 29 hearing for his panel to look at drug prices.

He is asking 12 manufacturers including Pfizer, Eli Lilly, Celgene, Novartis, Johnson & Johnson, Amgen, AbbVie and Sanofi to disclose details about their price increases, their investments in research and development and “corporate strategies to preserve market share and pricing power.”

Cummings referenced an HHS Office of Inspector General report from last summer that found government spending on brand-name drugs increased nearly 80% between 2011 and 2015 even though manufacturers have more than doubled the amount of rebates they offer.

The 20 brand-name drugs with the highest increases had few or no alternative treatments, the OIG found. Prices for some drugs went up more than 1,000%. One dialysis drug, Dianeal, spiked more than 200,000% although that was an outlier. Dianeal’s manufacturer Baxter was not on Cummings’ list.

Meanwhile, a bipartisan duo in the House is calling on the Federal Trade Commission and the Justice Department to look at the proposed $74 billion megamerger between Bristol-Myers Squibb and Celgene.

The lawmakers, Reps. Peter Welch (D-Vt.) and Tom Rooney (R-Fla.), teamed up last week to re-inroduce House legislation to authorize Medicare negotiation of drug prices with manufacturers.

Rooney is so far the only GOP co-sponsor for the bill, which is also getting pushed by Senate Democrats.

In the letter sent Friday to FTC Chair Joseph Simons and Acting Attorney General Matthew Whitaker, the lawmakers said the deal would further solidify Bristol-Myers Squibb’s place in the cancer drug market and give the company more leverage over formularies and rebates.

The lawmakers also mentioned Celgene’s history of deterring development of generic competition and raising the price of the cancer drug Revlimid while making a $280 million settlement for a lawsuit over its marketing practices for both Revlimid and Thalomid.

“Should the FTC and DOJ allow a merger, it should be conditioned on a hold harmless provision assuring that it will not be paid for by consumers, taxpayers, or employers, but by shareholders: the ones who stand to benefit,” Welch and Rooney wrote.