enry Waxman is a household name in pharmaceutical circles — during his three decades on Capitol Hill, he helped write the Affordable Care Act and expand Medicaid and the Children’s Health Insurance Program. He sponsored the 1984 Hatch-Waxman Act, which set up the modern infrastructure for bringing generic drugs to market, and chaired the Energy and Commerce Committee, which has jurisdiction over health-related issues, from 2009 to 2011.
Since his retirement from Congress in 2015, Waxman has served as chairman of Waxman Strategies, a lobbying firm that has been active on health issues, especially the 340B drug discount program.
STAT recently sat down with Waxman to hear his thoughts on the current political landscape around drug pricing, and what his prescription is for change.
This interview has been condensed and edited for clarity.
You’ve been working on drug pricing issues for at least three decades. What’s different now?
In the 1980s, we tried to achieve a balance by giving incentives for pharmaceutical manufacturers to invest in developing new breakthrough medicines and rewarding them for that by extending their patent period and providing exclusivities — particularly in the case of orphan drugs — and then balance that out with the competition at the end of that period so we could get lower price. As a result of the Hatch-Waxman Act, the generic drug industry became a viable player.
That balance is out of kilter right now, and I think we’ve got to try to restore it.
In Washington, who do you think is running the show?
I think there’s a strong interest by the public and by members of the House and the Senate to do something about high drug prices. Even President Trump has made this a high priority and said he wants to do more to hold down those prices and to protect people from having to forgo the use of drugs that may be lifesaving to them because they are unaffordable. So I think we have a unique time now when there’s more pressure and more concern on policymakers to do something.
But it’s not easy to move forward because there’s no easy answer to the problem. Some people say we’ve got to have price controls, and I don’t think there’s support for price controls, but what I would hope they try to do is to restore that balance.
For example, there’s a proposal that’s been around for a number of years called the CREATES Act, that simply allows for competition by allowing the generic manufacturer to know what was in the original drug so they can compete. [Editor’s note: The CREATES Act would empower companies that want to develop generic drugs to sue brand companies if the brand companies don’t provide samples of the brand drugs for research.]
So why has it taken so long to get CREATES passed?
I think there are some misunderstandings about it. And, of course, PhRMA is opposing it, and they’re very powerful. A lot of members haven’t paid attention to it, to this issue itself. So there have been attempts to attach it to other bills like the budget act.
What do you think of what Food and Drug Administration Commissioner Scott Gottlieb and Health and Human Services Secretary Alex Azar have done about drug pricing so far?
I don’t think that I can come to a conclusion at this point. I think that the fact I would want to emphasize is that they need to work on this issue, to focus on it, and to work with all the stakeholders to try and figure out what can be done.
The midterm elections are coming up. And we’re soon going to see a new Democratic presidential candidate, or a handful of candidates. What drug pricing proposals do you think they’ll get behind?
I think the key thing politically is not to wait for one party or the other to have control, but to recognize that this is an issue where Democrats and Republicans ought to put partisanship aside and work on the issue.
President Trump said that drug companies are ‘getting away with murder’ in January of last year. He suggested some small drug pricing reforms in his recent budget proposal, but no big reforms. What’s the holdup?
There have been a lot of things going on this past year, and I don’t think it’s too late for this year to take some of these actions to lay the groundwork for further addressing the problem of high prices of drugs after the election. It doesn’t make any difference whether Democrats or Republicans win the House or the Senate; it’s a question of getting Democrats and Republicans to figure out where they can act and I’m hopeful they’ll do some important things this year.
What do you think about the rhetoric from the president that it’s unfair for our drug prices to be so high and other countries’ to be so low — that the research and development here is subsidizing drug prices abroad? Do you think that’s accurate?
I think other countries have gotten a better deal on the prices they pay for drugs. And the U.S. should get a better deal as well. I don’t think we should say they ought to pay more elsewhere for us to benefit because we don’t benefit if they pay more.
What do you think about Rep. Greg Walden’s (R-Ore.) tenure as chairman of the House Energy and Commerce Committee?
I think the Energy and Commerce Committee has been pretty quiet on the issue of drug pricing.
What keeps you up at night regarding drug pricing?
I worry that if we produce more miracles that can save peoples lives, that it just won’t be affordable and people will go without. I think we would be derelict in our responsibilities in this country if that happens, and I think it’s happening, and it’s going to get worse if we don’t take action.
There have been proposals to do things like create a mortgage system to pay for drugs, or to only pay for drugs if they work. What do you think of these new payment models?
I think they ought to be on the table. People ought to look at them. There are suggestions, many from the Trump administration, that are good suggestions, in the budget proposal, that will hold down what people pay for drugs, but they don’t hold down the prices. But those are good things, too.
So do you think it’s a good idea to allow companies to continue to have high base prices, and then create these systems to bring down the actual cost to the patient? Or, in 10 years, will we be where we are now, where people have figured out how to circumvent those systems?
I’ve been amazed over the decades how creative some of the people in the industry have been to hold onto their ability to charge high prices. And it may make sense for their economic well-being, but I don’t think it’s doing anything for those who need those drugs.
And short of price controls, what sort of bigger solutions can we implement to prevent that creativity from harming consumers?
I think the only way we can get a bipartisan consensus … is to look to see where we can develop a consensus and tackle the issue bit by bit, not look for a magic solution, because there is none that I can think of that would make sense and that could pass.