Tester: Lower Prescription Drug Costs Through Transparency
Senator’s Bill Will Force Drug Makers to Disclose Cost Hikes
(U.S. Senate) - U.S. Senator Jon Tester is fighting to lower prescription drug costs for Montanans by shedding more light on the pharmaceutical industry.
Tester's bill, the Stopping the Pharmaceutical Industry from Keeping Drugs Expensive (SPIKE) Act, will force prescription drug companies to publicly disclose detailed information about a significant price increase on any prescription drug. Pharmaceutical companies are currently not required to release any information to the public after excessively raising the price of a life-saving drug.
"Montanans are forced to pay too much money for prescription drugs because pharmaceutical companies are hiding the real cost of drugs in the dark," Tester said. "This bill will hold these big corporations accountable and shed light on their decision to raise prices on life-saving medication. This bill will serve as a deterrent to unjustified price increases that harm Montana families."
Tester's SPIKE Act will require every pharmaceutical company to publicly disclose their justification for raising the price of a drug if one of two triggers are met. The first trigger is if the drug costs at least $10 per dose and its price increases 300 percent over five years or 100 percent over one year. The second trigger is if the drug is in the top half of the most expensive drugs for Medicare or Medicaid to buy and its price increases 50 percent over five years or 15 percent over one year.
If a pharmaceutical company hits a trigger, it will have to publicly report the following information:
- Price paid for the materials and manufacturing of the drug.
- Price paid for patent acquisition and licensing.
- Cost to purchase or acquire the drug from another company (if applicable).
- Price paid on research and development, including the amount of federal research and development funding received.
- Revenue and profit generated by the drug since approval.
- Price paid for marketing and advertising.
Earlier this year, Tester reached out to President Trump and offered to work together to lower the cost of prescription drugs. Despite never receiving a response from the Trump Administration, Tester's offer still stands.