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PA House Committee Hearing Focuses on the High Cost of Prescription Drugs

February 26, 2020

The Pennsylvania House of Representatives Health Committee recently held a public hearing in Harrisburg to discuss prescription drug prices. The increasing cost of prescription drugs is a growing concern among Americans, as well as state and national lawmakers.

Hospitals have a direct interest in seeing action to address drug prices. Hospitals are impacted by significant increases in expenditures for prescription drugs for inpatient and outpatient care, and also play a role in helping patients navigate the financial burden of rising drug costs.

The hearing featured presentations by industry experts from the Institute for Clinical and Economic Review, the National Academy for State Health Policy, LifeSciences PA, and the Pharmaceutical Research and Manufacturers of America.

Key findings of a recent report—Recent Trends in Hospital Drug Spending and Manufacturer Shortages—issued by the University of Chicago’s NORC, an independent research institution, indicate average total drug spending per hospital admission increased 18.5 percent between fiscal years 2015 and 2017. More than 90 percent of surveyed hospitals reported having to identify alternative therapies to mitigate the impact of drug price increases and shortages.

A previously issued 2016 report—Trends in Hospital Inpatient Drug Costs: Issues and Challenges—documented that hospitals are faced with large and unpredictable increases in the price of drugs used in the inpatient setting, resulting in a significant increase in inpatient drugs spending and putting budgetary pressure on hospitals.

Many hospitals in Pennsylvania turn to the 340B Drug Pricing Program is an effective tool to help manage the impact of high cost drugs through discounted medications from drug manufacturers. Savings are used to care for more patients, improve services and build healthier communities, or help patients secure prescription drugs at significantly reduced costs, or no cost at all.

The American Hospital Association (AHA) is spearheading hospital efforts to advance policy solutions that address ever-increasing drug prices. The AHA has recommended steps to restrain out-of-control drug prices and address drug shortages, including:

  • Stopping brand-name manufacturers’ anticompetitive actions by addressing ever-greening and pay-for-delay practices
  • Speeding up generic drug approvals
  • Passing the CREATES Act which would allow generic drug manufacturers facing certain anticompetitive delay tactics to bring an action in federal court for injunctive relief
  • Strengthening manufacturers’ drug shortage disclosure requirements
  • Developing drug shortage plans
  • Incentivizing the production of drugs in shortage and manufacturing contingency plans and redundancies
  • Encouraging early drug shortage alerts to mitigate the risks

Questions about HAP’s state advocacy efforts should be directed to Stephanie Watkins, vice president, state legislative advocacy. Inquiries about efforts at the national level should be directed to Laura Stevens Kent, HAP’s senior vice president, strategic integration.