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US says medicine ads should include list prices

Hopes the proposal will encourage lower prescription drug prices


The US government has said pharma companies should disclose the list price of products in direct-to-consumer TV advertising, as part of its push to bring down prescription drug prices.

The measure is intended to create better incentives for lowering prices, which is one of the four pillars of President Trump’s blueprint for pricing controls introduced in May, along with boosting competition, enhancing negotiation, and bringing down out-of-pocket costs for patients.

The move ramps up pressure on the industry on an issue that more than any other is likely to garner bipartisan support in Congress, giving Trump an easy win if Democrats win control of the House of Representatives next year.

“Right now, drug companies are required to disclose the major side effects a drug can have – but not the effect that buying the drug could have on your wallet,” said the Department of Health & Human Services (HHS) in a statement on the move. “Patients deserve more transparency.”

The new rule, which is still up for discussion, would affect any drug covered by Medicare or Medicaid. It goes much further than industry’s proposal to provide a link in TV advertising to websites that would reveal drug prices – and how much patients can actually expect to pay for their drugs.

The proposal by the trade body PhRMA was unveiled yesterday just ahead of the HHS announcement. Member companies – including Sanofi, Eli Lilly and others – were quick to point out that their solution would allow more information to be provided to patients, including not only the list price but also “average, estimated, or typical patient out-of-pocket costs, [and] other context about the potential cost of the medicine.”


PhRMA has also pledged to launch a new platform that will provide cost and financial assistance information for brand-name medicines, as well as other patient support resources. Publishing list prices alone would be “confusion” for patients, it asserts.

The industry’s plan has however been dismissed by HHS Secretary Alex Azar as inadequate, on the grounds that it would continue to allow companies to hide and make complex arguments for the price of their medicines that would undermine the overarching aim of incentivising price reductions.

Azar told the National Academy of Medicine (NAM) that “for too long, drug pricing has been like no other market. Prices are completely opaque, and the industry actually makes a point of claiming that their list prices are often meaningless.”

“But that second part isn’t really true,” he continued. “List prices are meaningful to every American senior on Medicare Part D, who pay coinsurance for drugs as a share of list price for specialty and non-preferred drugs. They mean a lot to the almost half of Americans under age 65 who have a high deductible health plan – meaning they can often pay thousands of dollars toward the list price of a drug before their insurance kicks in.”

On the industry’s proposals, he added: “placing information on a website is not the same as putting it right in an ad.” And if companies don’t take steps to tackle the issue, as with the advertising plans, “we have the power to redesign the system for them,” he warned.

PhRMA has suggested that any attempt to force companies to disclose prices would violate First Amendment rights because of restrictions on ‘compelled speech’.

Article by
Phil Taylor

16th October 2018

From: Sales



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