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 At a campaign stop in Iowa, Clinton rolled out a plan to encourage
the development and use of generic drugs and to end pharmaceutical
companies' ability to write off consumer-directed advertising as a
business expense.
Under Clinton's plan, the monthly cap would limit what insurance
companies could ask patients to pay for drugs that treat chronic or
serious medical conditions.
"We need to protect hard-working Americans here at home from
excessive costs. Too often these drugs cost a fortune," she said in
Des Moines, adding drug companies keep the profits for themselves
while "shifting the cost to families."
Clinton's comments came after the New York Times reported on how a
startup biotechnology company, Turing Pharmaceuticals, raised the
price of the 62-year-old Daraprim treatment for a dangerous
parasitic infection to $750 a tablet from $13.50 after acquiring it.
"That is bad actors making a fortune off people's misfortune," she
said.
In the face of sharp criticism of its action by patients, medical
groups and Clinton, Turing's chief executive officer, Martin Shkreli,
told ABC's "World News Tonight" on Tuesday that the price of
Daraprim would be lowered "to a point that is more affordable."
"Good," tweeted Clinton in response to news of the planned price
rollback.
The Nasdaq Biotechnology index closed down 1.7 percent on Tuesday
after falling as much as 3.5 percent during the session. It had
already fallen 4.4 percent on Monday after Clinton tweeted her
intent to tackle high prices of some drugs.
The index, which had finished the last six years higher, is up 10.4
percent so far this year.
Citi biotechnology analyst Liav Abraham said that with 2016
presidential candidates taking on steep drug pricing, "companies
with less differentiated, more concentrated product portfolios are
likely to come under increased political scrutiny."
But the rhetoric may have "more bark than bite," he said, since the
reforms would require approval by a Republican-dominated Congress
that is unlikely to implement them.
While Clinton has maintained her front-runner status in the
Democratic race, she has been under pressure to take more populist
stances to widen her lead over U.S. Senator Bernie Sanders, her
second-place rival who has also offered a plan to rein in
prescription drug costs.
CONSUMER MARKETING CONTROVERSY
Critics of marketing drugs to consumers say it encourages the use of
costly brand names over generics and can be confusing or misleading.
A series of court decisions has determined the practice cannot be
banned outright because it is a form of commercial speech protected
by the U.S. Constitution.
Clinton said the government could get billions of dollars in
additional tax revenue by no longer allowing pharmaceutical
companies to deduct what they spend marketing drugs to consumers.
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The largest pharmaceutical companies are collectively earning $80
billion to $90 billion per year at higher margins than other
industries while average Americans struggle to pay for medicine,
Clinton's campaign said.
Clinton also proposed a ban on "pay-for-delay agreements," in which
the owner of a brand-name drug pays a generic competitor to keep its
product off the market for a period of time, usually as part of a
litigation settlement.
Clinton said she wanted Medicare, the U.S. government's health
insurance program for the elderly, to be able to negotiate with
pharmaceutical companies over drug prices and require more generous
rebates.
Consumers would also be allowed to purchase drugs from other
countries, where medicine is often less expensive, so long as
sufficient safety standards are in place, Clinton said.
She said her proposals would augment President Barack Obama's
healthcare law known as Obamacare. High drug costs had played a role
in making families feel like healthcare costs were not coming under
control, she said.
Clinton was expected to outline a separate set of proposals on
Wednesday to address other out-of-pocket healthcare costs.
Traditional "Big Pharma" companies have long faced criticism for
steadily raising prices of their prescription medicines in the
United States, often by jumps of 10 percent or more.
Drugmakers are unapologetic about their five- or six-digit prices on
new treatments for cancer, hepatitis C and high cholesterol. Sovaldi,
a treatment from Gilead Sciences Inc, can cure hepatitis C but at a
cost of $1,000 per pill.
Even more controversial have been eye-popping increases in costs for
older drugs in limited supply, often after other drugmakers acquire
them. They say the funds help cover research and development costs
for new products.
For more on the 2016 presidential race, see the Reuters blog, "Tales
from the Trail" (http://blogs.reuters.com/talesfromthetrail/).
(Additional reporting by Michele Gershberg and Sinead Carew in New
York, and Peter Cooney in Washington; Editing by Lisa Von Ahn and
Cynthia Osterman)
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