Rare consensus on drug prices must lead to action

Martin Shkreli, the former chief executive of Turing Pharmaceuticals who is facing federal securities fraud charges, testified before a House committee on Thursday about the price of drugs.
Zach Gibson/The New York Times
Martin Shkreli, the former chief executive of Turing Pharmaceuticals who is facing federal securities fraud charges, testified before a House committee on Thursday about the price of drugs.

Congressional hearings typically divide along party lines. Democrats and Republicans joust for time to make self-righteous pronouncements, showing off their staffs’ research skills. Committee members’ remarks are punctuated with sufficient outrage to imply swift action is forthcoming. It usually isn’t.

There was some of that going on Thursday when the House Committee on Oversight and Government Reform held a hearing on drug pricing — an issue that’s bound to receive attention throughout the presidential campaign season. But there also were signs that members of Congress from both parties might be able to work together on achieving a tricky balance — making medicine affordable while still rewarding those who, against scary odds, seek to develop disease-beating treatments.

The House committee’s session attracted more notice than normal because of a brief appearance by its star witness, Martin Shkreli, aka “Pharma Bro.” Shkreli is the now-infamous former chief executive of Turing Pharmaceuticals, which bought an obscure drug that treats a parasitic infection and jacked up the price from $13.50 to $750 a pill. Shkreli, who was arrested on unrelated securities fraud charges, smirked and fidgeted in his seat before invoking the Fifth Amendment. “I don’t think I’ve ever seen the committee treated with such contempt,’’ said Representative John Mica, a Florida Republican.


Once the Shkreli spectacle was over and the committee began grilling other witnesses — including the Food and Drug Administration’s Janet Woodcock, and executives from another Shkreli company, Valeant Pharmaceuticals — it became clear that the indignation over drug pricing was bipartisan. That offers hope, however slim, that progress can be made on an issue that will become even more urgent as aging baby boomers put added financial pressures on the health care system. It’s also far more complex than Shkreli’s “greedy drug guy” story line implies. For instance, some expensive cutting-edge drugs — like the new line of hepatitis C pills — work so well that they could prove a bargain over time. In those cases, what’s the best way to determine a fair upfront price? And how can long-term savings be quantified?

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Those questions weren’t answered Thursday, but a lot of time was devoted to discussing a facet of drug-industry regulation that is easier to dissect, and change — the FDA’s massive backlog of generic-drug applications. More than 3,500 generics are awaiting regulatory approval, and it can take four years to get to the front of the line. That’s despite the 2012 passage of the Generic Drug User Fee law, which allowed the FDA to charge pharmaceutical companies fees in return for priority reviews of their products. The money collected, about $1 billion so far, is for additional staffing to clear the glut. On average, a genericcosts about 80 to 85 percent less than its brand-name equivalent, so the potential savings from increased competition are enormous.

“It’s neither rocket science nor brain surgery,” says Dr. Jerry Avorn, a Harvard Medical School professor and researcher, “just simple pharmaceutical science versus bureaucratic inertia and — apparently — inadequate person power.” The user-fee act, Avorn says, “isn’t working well enough.”

The House committee hearing followed a Senate hearing late last month that reviewed the 2012 user-fee law and reached the same conclusion — it’s taking too long to get new generics on the market. It’s a rare consensus that Congress can’t afford to squander. Martin Shkreli made himself an easy target, but holding the FDA accountable for its sluggish pace on generics could make a real difference.