Democrats' Inflation Reduction Act Kills $18 Billion Per Year in Cancer Cures


Date: Nov. 7, 2022

President Biden recently claimed that the Inflation Reduction Act will lower drug costs for cancer patients. Yet the truth is that new government price setting on prescription drugs will actually cause prices to go up, destroy patients' access to new cures, and stall the war on cancer.

Biden's inflation crisis, the highest the country has seen in nearly 40 years, is forcing Americans to choose between paying for groceries, gas, electricity, or life-saving medication. Although Biden claims prescription drug price fixing will lower prices, the Congressional Budget Office (CBO) confirmed just the opposite -- that the Democrats' scheme will cause higher prescription launch prices. Whether you're covered by Medicare, Medicaid, private insurance, or are uninsured, you'll be paying more for your medications as a result of the Inflation Reduction Act if these new cures are developed at all

As co-chairs of the GOP Doctors' Caucus, we vigorously fought Democrats' efforts to impose government price fixing under the guise of Medicare negotiations because we knew the costly tradeoffs: patients will lose decades of progress in the war on cancer.

A recent study by University of Chicago economist Tomas Philipson found that the Democrats' price setting scheme will kill about $18.1 billion in annual spending on cancer research and development, which dwarfs the $1.8 billion government spending on cancer Biden touted at the Cancer Moonshot initiative.

Over the next two decades, this will amount to more than half a trillion dollars in lost research and development revenue. \ The Inflation Reduction Act will wipeout nearly a third of the current annual spending on cancer research and development, leading to fewer new cures and discouraging innovation and investment in an industry that relies heavily on private sector funding.

As the recent University of Chicago study clearly shows, the Democrats' price-fixing scheme will kill up to 342 cures over the next two decades. If that isn't startling enough, CMS drug utilization data from 2016-2020 shows that the types of drugs most impacted by Democrats' price fixing could leave over 42 million patients without needed medications.

One lost cure is one too many.

As doctors we know many new treatments are the result of clinical trials for new indications of an already approved drug. A drug will get an indication for a more common type of cancer and then do further research on rarer cancers that drug could also treat. The distorted incentives of the Democrats scheme will discourage these type of indispensable medical advancements.

American investors put tens of billions of dollars into research for cancer drugs each year. As a result, cures have been developed and lives have been saved. These drugs are estimated to cost nearly $4.5 billion to develop and the process to develop them can take over ten years. Democrats' new bill will scare off most of that much-needed investment of time and capital. In addition to delaying and eliminating incentives for researchers to innovate and develop new drugs, the Inflation Reduction Act also creates perverse incentivizes that will impact what drugs researchers ultimately invest in.

The Inflation Reduction Act is "forcing me to choose to develop a drug for kids instead of a drug for their grandparents, when I could be developing both," writes Steve Potts, PhD, who has been involved in cancer drug development for more than 20 years.

Unfortunately, when Biden talks about health care and the cure for cancer, he continues to put government at the head of the table. Scientists, physicians, and patients are the beating heart of American medical innovation -- not bureaucrats in Washington, D.C. -- and it is their voices who should be heard here.

Every member of the GOP Doctors Caucus ran for Congress because we felt that the joy of taking care of patients has been eroded by government mandates our health care system is staggering under, particularly the decision to place bureaucracy ahead of patient care.

Biden is right that there are bipartisan solutions for our healthcare system and ways to lower cancer related drug costs. The President specifically highlighted an out-of-pocket cap for seniors and the ability to spread drug costs over the year. This is something that members from both parties have worked on and was included in H.R. 19, the Lower Costs, More Cures Act of 2021. That bill included 36 bipartisan provisions that would lower out-of-pocket spending on prescription medications and empower patients' access to the very best medical therapeutics, diagnostics, and technologies -- but Speaker Pelosi rejected this opportunity to bring a bipartisan solution forward for the American people and instead has pushed her damaging government price fixing scheme.

The Inflation Reduction Act robs Americans of needed lifesaving treatments and cures, prioritizes bureaucracy over patients, and will throttle decades of research and development. Government-first solutions such as the $1.8 billion funding for the Cancer Moonshot initiative pales in comparison to the more than $18 billion in annual spending on cancer research that will be lost thanks to the Inflation Reduction Act. There are bipartisan solutions for lowering medication costs that don't put a halt to decades of private sector progress in the war on cancer. Let's value cancer patients, and the private research on cures they need, above Washington bureaucrats and partisans.