HELP Ranking Member DeSaulnier Opening Remarks at Hearing on Lowering Drug Prices

HELP Ranking Member DeSaulnier Opening Remarks at Hearing on Lowering Drug Prices

WASHINGTON - Ranking Member Mark DeSaulnier (CA-10) delivered the following opening statement at today's Health, Employment, Labor, and Pensions Subcommittee hearing entitled, "Profits Over Patients: The PBM Business Model Under Scrutiny."

"Thank you, Mr. Chairman. I want to thank all the witnesses for being here.

"This is something I think we can all agree on. This is inefficiency. When Americans are struggling day-to-day to pay for their fixed costs, so they have a little extra money to take their kids on a vacation or just go out to eat, [Pharmacy Benefit Managers (PBMs)] just suck money out of American workers' pockets. There was a point to them, at one point, in terms of improving efficiency, but in the most costly health care system in the world for a developed country-18 percent of GDP, with the worst outcomes-this is a perfect example.

"Mr. Chairman, of something you and I have talked about often, and something that Democrats and Republicans should be able to come together on. It's wasteful. Let's be efficient, and let's save Americans a little extra money so they can get out of the stress they feel where they worry about gas prices and paying for lunch for their kids. Here is a perfect example of something that does no good for anyone to speak of other than the people who make money off it. So, here's a real opportunity for employers and for working people to get a real benefit.

"PBMs, as I just said, are a huge part of the problem in our inefficiencies. Americans should be embarrassed and outraged by this. Unfortunately, their business practices are notoriously opaque, leaving employers and workers unable to even get an idea of what they cost.

"I am proud to say that we have done good, bipartisan work on this Committee on this Subcommittee to get a start on PBMs and improve transparency and efficiency. My colleague, the gentleman from Connecticut, Mr. Courtney, introduced the bipartisan Hidden Fee Disclosure Act to shed light on fees charged by PBMs, third-party administrators, and other service providers. We have also worked in a bipartisan manner to craft legislation requiring detailed disclosures of PBM rebates, fees, and other information to group health plans. I am pleased to see that portions of both bills were included in February's spending legislation.

"I hope that these reforms, as well as the important rule proposed in January by the Department of Labor (DOL), can lead to progress that reduces conflicts of interest and inefficiencies in the PBM model. We can't wait. There is urgency, in my perspective, to fixing this and getting rid of the fraud in the PBM model.

"But demanding transparency from PBMs alone will not solve the crisis of skyrocketing drug prices. We cannot get a handle on this issue until we address the elephant in the room-Big Pharma. In 2022, Democrats-over, unfortunately, unanimous opposition from our colleagues, and I hope to change that-took a historic step forward by creating the Medicare Drug Price Negotiation Program. In just the first two years of that program, lower prices have already been negotiated for 25 drugs that account for more than $90 billion in spending.

"It is now time for Congress-in a bipartisan way, in my view, and I'll work every day to work with you, Mr. Chairman, in a bipartisan way-[to] lower costs for Americans with PBMs and negotiate competitive prices for the market to work the way other developed countries have-the [European Union], Australia, and New Zealand.

"I've talked about my own personal experience with the drug that keeps me alive as a survivor of stage four leukemia. Much of the investment in that drug came from taxpayers at the Department of Defense (DOD) over the last 60 years, and the [National Institute of Health (NIH)]. It's really remarkable. I'm alive today because of this research. But Johnson and Johnson, and I have spoken to the CEO of Johnson and Johnson over that in the Oversight Committee when we brought him to testify, it's fair to get a reasonable rate of return. We encourage that, for the private sector. But let's be honest about where much of that primary investment research came from - American taxpayers and the brilliant people at the DOD, the NIH, [the Defense Advanced Research Projects Agency (DARPA)], and [Advanced Research Projects Agency for Health (ARPA-H)].

"The [Lowering Drug Costs for American Families Act] we've introduced on [lowering drug costs] would go to the root of the problem, both for PBMs and the other issue of Big Pharma.

"In this instance, with PBMs in this hearing, [we are] targeting middlemen who add little value to employers or to workers.

"Thank you, Mr. Chairman, and I yield back."

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