President Joe Biden and Senator Bernie Sanders
As President of the United States and Chairman of the Senate Committee on Health, Education, Labor and Pensions, we have long been concerned about the exorbitant prices the pharmaceutical industry is charging Americans for prescription drugs.
There is no rational reason why Americans, for decades, have been forced to pay the highest prices ever in the world for the prescription drugs they need.
There is no rational reason why, for decades, one in four Americans could not afford the drugs their doctor prescribed.
And it is surely not our patriotic duty as Americans to pay high drug prices at home so that people overseas can enjoy the fair prices to which all Americans are entitled.
That’s why, together, we’ve made great progress over the past few years.
As a result of the Inflation Control Act, which passed Congress without a single Republican vote, seniors with diabetes will pay less than $35 a month for insulin. After January, no senior in America will pay more than $2,000 a year for prescription drugs. And for the first time in history, Medicare is doing what every other major country is doing: negotiating with pharmaceutical companies to lower the prices of some of America’s most expensive drugs.
This common sense policy is supported by an overwhelming majority of Americans, including over 60% of Republicans.
By working with some of the world’s largest pharmaceutical companies, we have also succeeded in reducing the cost of the inhalers that millions of Americans with asthma and chronic obstructive pulmonary disease need to breathe from $645 to just $35.
We are very proud of these accomplishments — the U.S. government finally stood up to Big Pharma — but much more needs to be done to lower the outrageous prices of prescription drugs.
Plans to expand drug price negotiations
What does that mean?
This means that at a time when many Americans suffer from a variety of chronic conditions, no one in our country, not just seniors, should have to pay more than $2,000 a year for a prescription drug they need. It also means that we need to increase the number of prescription drugs eligible for price negotiation to more than 50 per year. We are working together on a bill to do just that, and I hope all members of Congress will support it.
But let’s be clear: it’s not just Congress that needs to act: prescription drug companies must stop defrauding the American people, too.
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To take one big example, tens of millions of Americans currently suffer from type 2 diabetes and obesity.
The good news is that Novo Nordisk, one of the world’s leading pharmaceutical companies, has developed two new blockbuster drugs, Ozempic and Wegovy, that effectively treat these conditions.
Obesity drugs are too expensive
The bad news is that Novo Nordisk is charging Americans exorbitantly high prices for these prescription drugs. If your doctor prescribes a GLP-1, the price of Ozempic and Wegovy can be up to six times higher than the price in Canada, Germany, Denmark, and other major countries. This is unacceptable.
This is not just a problem for Novo Nordisk: Eli Lilly is also charging exorbitant prices for its drug Mounjaro, which has similar health benefits to Ozempic, at roughly $1,100 per month.
Why should people in Burlington, Vermont pay much more than people in Copenhagen or Berlin for the same medicine? The simple fact is that people in Paris, Texas should not pay much more for Ozempic or Wegovy than people in Paris, France.
The inequity becomes even more stark when you look at the profit margins of these companies: A study by Yale University researchers in March, for example, found that these drugs could be produced profitably for less than $5 a month, or $57 a year.
Novo Nordisk scientists should be greatly praised for developing Ozempic and Wegovi. These drugs could be breakthroughs for people around the world who suffer from type 2 diabetes and obesity. But as important as these drugs are, they will do nothing for the millions of patients who cannot afford them.
Moreover, if the prices of these drugs are not significantly reduced, they could bankrupt the American healthcare system.
We won’t allow that to happen.
If half of obese adults took WeGobi and other new weight-loss drugs, the cost could reach $411 billion a year — $5 billion more than all prescription drug costs Americans will pay over the pharmacy counter in 2022.
If half of obese Medicare and Medicaid beneficiaries took Wegobee or other weight-loss drugs, Medicare and Medicaid would spend $166 billion a year — as much as the two federal health programs spent on all retail prescription drugs in 2022.
This is neither a morally nor financially responsible thing to do.
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While pharmaceutical companies make huge profits, Americans suffer
Let’s be clear: Each year, while many Americans struggle to afford the prescription drugs they need, the pharmaceutical industry is raking in huge profits. In fact, the 10 biggest pharmaceutical companies made more than $110 billion in profits last year.
For example, in 2023, Novo Nordisk made over $12 billion in profits, in part by charging Americans over $1,000 a month for prescription drugs that could be profitably produced for under $5. This is not a reasonable return on investment. This is price gouging and corporate greed.
Drug companies will argue that because they rely on opaque discounting schemes through middlemen, the price Americans pay for drugs may end up being lower than the price the drug companies charge. But these opaque tactics prevent payers from understanding the true price of drugs, thereby weakening their negotiating position.
Pharmaceutical companies would also argue that lowering the price, even if the actual price is prohibitively high, would stifle innovation and make it less likely that innovative medicines like Ozempic will be developed in the future, but reaping the benefits of innovation is not fundamentally incompatible with fair pricing for consumers and helping the widest range of people possible.
If Novo Nordisk and other pharmaceutical companies refuse to significantly lower prescription drug prices in our country and end their greed, we will do everything in our power to end the greed for them. Novo Nordisk must significantly lower the prices of Ozempic and Wegovi.
As Americans, we must not rest until every citizen can afford the prescription medications they need to live healthy, happy, and productive lives.
Let’s move forward together.
Joe Biden is the 46th President of the United States. Vermont Senator Bernie Sanders is the Chairman of the Senate Health, Education, Labor and Pensions Committee.
