Illustration: Shoshana Gordon/Axios
An array of conservative groups is calling on GOP leaders to roll back the drug pricing provisions of the Inflation Reduction Act and seeking to elevate the issue on the party's agenda for the next Congress.
Why it matters: The letter to Speaker Mike Johnson and Senate GOP Leader Mitch McConnell comes two days ahead of the first presidential debate, and highlights the political stakes around Democrats' efforts to lower drug prices.
What they're saying: The groups portray the Medicare drug price negotiations as heavy handed and economically ruinous.
- "History shows that price controls never achieve their stated ends and the IRA's price controls are further evidence," the letter states. "Basic economics dictates that imposing price controls on one class of products will simply force manufacturers to stop producing or investing in those products."
- The letter is signed by groups including Americans for Prosperity, Americans for Tax Reform and CPAC.
- The effort was organized by Ryan Ellis, president of the Center for a Free Economy and a lobbyist for Akin Gump, which has drug industry clients.
The big picture: Repeal of the IRA drug pricing provisions will realistically only be on the table if Republicans sweep the House, Senate and White House in November.
- Even if that happens, congressional Republicans, while highly critical of the law, have not gone into detail about their plans for next year.
Between the lines: Dean Clancy, senior health policy fellow at Americans for Prosperity, said there are options short of full repeal, including eliminating the 95% tax imposed on companies that refuse to participate in the Medicare negotiations.
- "I don't know what they're planning to do on this particular policy," Clancy said of congressional Republicans. "The letter that we signed was in part to try to alert them to the negative consequences that have arisen already from it, and you know, put it on their radar."
- Grace-Marie Turner, president of the Galen Institute and another signer of the letter, said it is unclear if full repeal is possible.
- "Whether the whole thing could be repealed or not is a political question, not a policy question," she said. "But we certainly are going to be at the table offering as many ideas and suggestions as we can."
The other side: Democrats have made drug price negotiations a centerpiece of their campaign pitch, saying they are lowering the cost of some of the costliest drugs to Medicare and saving patients and the government money.
- The CBO has projected about $100 billion in savings over a decade.
- The conservative critics argue the law will hurt innovation, and that it is not really a "negotiation" because of the hefty tax that hits companies that walk away from the table.
- The letter proposes alternative policies like passing rebates paid to PBMs on to patients.
- "Instead of hiring more bureaucrats to set up a new price control board, Congress should work to lower Medicare premiums, increase plan choices, and require insurers and pharmacy benefit managers to share discounts, rebates, and savings with patients," it states.
