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Democrats say they are the party of science but their drug price plans tell a different story

Democrats may claim to be the party of science, but their drug pricing plans are a complete opposite.


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The Democrats are proud to claim that they are the party for science. However, two recent announcements have shown just how ignorant and inadequately informed they are about science’s progression from the laboratory to our medicine cabinet. 

The first announcement was results from Pfizer’s clinical trial of its new anti-viral treatment for COVID-19. The treatment resulted in a dramatic 90 percent reduction of hospital admissions for high-risk people compared with those who were given a placebo. Surprisingly, the treatment was not fatal for any of those who were treated. Second, Democrats announced that they had reached an agreement to block and eventually cripple the investment system in life sciences that makes such breakthroughs possible. 


The Democrats’ destructive proposal would allow Medicare to dictate the price it pays for certain classes of drugs. While the Democrats are calling their price dictation plan, “negotiation”, it is actually a deliberate lie. The arrangement’s structure gives the government all the leverage, including a penalty tax of 95 percent on gross sales of the drug if the manufacturer refuses the government’s demand. 

It takes an average of over $2Billion in investment and more than 10 years for a new drug on the market. Who would put their money at risk if they imposed a price that is not fair to investors after spending all this time and money?   

House Speaker Nancy Pelosi (D-Calif.) and Senator Bernie Sanders (I-Vt.) prioritized short-term dollars over the long-term consequences for patients. However, moderate Democrats managed to limit drug eligibility for price dictation for those drugs whose exclusivity periods have expired. Even this compromise was flawed. 

Already, we have an extremely successful method of decreasing the price of medicines beyond their exclusivity periods: biosimilars and generics. In the past decade, savings of $2 trillion were achieved by these generic alternatives to brand names. The U.S. Food and Drug Administration estimates that a drug’s price falls by nearly 40 percent when the first generic enters the market – and by 80 percent with four or more. 


Dictating the price of drugs past their exclusivity window would put generic and biosimilar development at risk because generic manufacturers won’t be able to anticipate a price point for the drug they will be competing against. There will be less competition and this could lead to lower prices. 

More broadly, the narrower proposal still suffers from the same fundamental flaw as the original HR3 drug negotiation proposal and all Big Government Socialist schemes – it fails to anticipate how people will react to the incentives created. The private investors in life sciences who finance early-stage drug development are the ones we’re referring to. 

Drug development can be described as a race to the finish. Basic science research is the first step. It is usually funded by taxpayer funds, but it can also come from private sector research. Private sector research can lead to promising new insights. Many scientists partner with life-science investors to start small biotech businesses to test and develop treatment options based upon initial research. About 50 percent of new treatments that reached the market were developed by small biotech businesses funded in part or all through life science investors. 

Early clinical trials can be very promising. To complete the remaining clinical trial steps, a small biotech company may partner with an established manufacturer. It can become quite costly. The chances of success at this stage are low. Stage 3 is a difficult stage for many promising drugs. 


The Democrats and their Big Government Socialist price dictation scheme pretend the second leg of the relay doesn’t exist. Their simplistic narrative states that the government finances science research, and big drug companies profit from it. For political reasons, the only result that the left can see is that large drug companies make less. 

The fact that they are not dictating prices is a sign of weakness. This will make it difficult for life scientists to invest in the next leg of the drug development relay. The Congressional Budget Office estimated that the Democrats’ original version of their price dictation scheme, HR3, would lead to 30 fewer new drugs introduced over the next decade (a 10 percent reduction). 

But, it is possible that this underestimates the effects of price dictation on drug prices. Several analyses, including from Charles River Associates and Doug Holz-Eakin of the American Action Forum, point out that the CBO analysis doesn’t account for just how much of new drug development goes through small biotech firms – and how essential life science investors are to giving these firms the capital they need. 

As John Sanford, executive director of Incubate said recently, “If price controls are enacted, the life sciences investment equation will no longer justify investment in R&D. Investment won’t just be reduced, it will drop off a cliff.” European countries suffered a similar fate in the 1980s and 1990s as much of their capital and R&D base shifted to the U.S. Price control policies such as those being considered in Congress could cause a similar flight pattern to places such as China and India.


There are many options for investors when it comes to where they should put their money. Investors will move their funds to other areas if life sciences appear less promising. The number of drugs under development will plummet as investors shift their investment dollars from the life sciences to other fields. 

Democrats must remember that medicine’s cardinal rule is “do not harm”. They fail this test. This proposal would cause harm to patients, as it will stop drug research and development from receiving the funding necessary for new treatment and cures.  Vote against the measure if you are a Democrat and care about patients.

To read, hear, and watch more of Newt’s commentary, visit

Joe DeSantis is chief strategy officer at Gingrich 360 and leads the organization’s health care strategic initiatives and consulting. 

Gingrich 360 provides advice to various organizations and companies in the healthcare industry.


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