Bill would end price protection of drug industry

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It remains widely known, and wildly unfair, that Americans pay higher drug costs than most of the world.

This, despite the fact that much medical research is funded in whole or in part by taxpayers, and that U.S. taxpayers often subsidize the educational expense of training the scientists who develop the drugs. Meanwhile, U.S. drug companies are regularly among the most profitable corporations in the country.

It is not only unfair but an increasingly serious financial burden to U.S. employers and families.

While we do not favor government price controls, we do favor strong but prudent measures to give Big Pharm the same sort of competitive pressure felt by every other major industry.

Just before Christmas, Sens. Olympia Snowe and Byron Dorgan announced they would re-introduce the Pharmaceutical Market Access and Drug Safety Act.

This legislation went nowhere in the last Congress. However, we now hope that new faces in congressional leadership positions can breathe new life into this proposed law.

It is a measure of the drug industry’s political power that it remains shielded from foreign competition. While the U.S. textile, clothing, steel and auto industries have been decimated by open-market competition, prescription drugs remain one of the few bastions of blatant protectionism.

It has been particularly ironic that presidents who have moved aggressively to tear down trade barriers with Canada, Mexico and South America have been afraid to touch the U.S. drug import issue.

The Drug Safety Act will allow for the importation of foreign drugs and the re-importation of drugs made by U.S. firms but often sold abroad for as much as 50 percent less than in the U.S.

“It is unfair that year after year the American people continue to pay more for their prescription drugs than any other country in the world,” Snowe said in a prepared release. “Now is the time for the Congress to act in a bipartisan manner to bring down the cost by passing common-sense legislation that would allow for the safe, effective importation of prescription drugs.”

She’s right.

The second goal for 2007 should be to allow the federal Medicare system to bargain, like the Veterans Administration, with drug companies on behalf of senior citizens. It has been estimated that the government could save at least $2 billion per year by doing so.

A recent study by the AARP found that the prices of 193 brand name prescription drugs most often used by senior citizens grew at almost four times the rate of inflation between June 2005 and June 2006.

It’s about time the U.S. drug industry got real competition, and consumers got real relief from higher drug prices.

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