- - Monday, February 9, 2015


Last year set a high-water mark for pharmaceutical innovation. And some of the most promising new drugs will treat major diseases, including diabetes, lung cancer, Hepatitis C, and leukemia.

Unfortunately, Congress is considering legislation that could halt this progress. The misnamed “Medical Innovation Act,” sponsored by Senator Elizabeth Warren (D-MA), will burden drug makers with hefty new fees. By reducing the capital available for private drug development, this bill will smother innovation and choke off the flow of new, life-saving medicines to American patients. Congress should
scrap it.

Private biotech companies spend over $50 billion annually on research and development. This staggering investment has yielded over 450 new medicines in recent years.

These groundbreaking treatments have saved and extended millions of lives. From 2000 to 2011, new pharmaceuticals helped cut the death rate from cancer by 15 percent. Today, two-thirds of cancer patients survive at least five years — a 39 percent increase from 1975. And drug companies are currently designing and testing almost 800 new cancer treatments.

Biopharmaceutical companies have played a key role in the fight against another deadly disease: HIV/AIDS. Advanced drug cocktails decreased the death rate for HIV-positive Americans by almost 85 percent since 1995. These medicines prevented over 862,000 premature deaths. And 44 new treatments are in the development pipeline.

Sen. Warren’s proposal would redirect drug-makers’ profits towards government research organizations like the National Institutes of Health. Supporters of the bill claim that private biotech companies rely on the NIH for research data and should have to chip in extra as a fee-for-service.

But government research doesn’t play nearly as large a role in drug development as Senator Warren believes. In fact, less than one in 10 new drugs is the direct result of government-funded work. And less than half of new drug patents even cite government patents or publications.

The NIH focuses on basic scientific research, which may or may not have a medical application. This work is certainly important. But if Sen. Warren wants to boost medical innovation, it makes no sense to take money away from private biopharmaceutical firms — who concentrate solely on creating workable drugs — and give it to a government body with a broader focus.

Sen. Warren’s bill could also hurt patients by increasing prescription costs. Pharmaceutical firms could be forced to compensate for these new expenses by raising drug prices. That means average Americans will pay more every time they fill a prescription.

Rather than spur new discoveries, the Medical Innovation Act will actually harm drug development by taking research funding away from the organizations that spend it most effectively — private biopharmaceutical firms. This legislation needlessly risks the health of patients who depend on these companies for life-saving medications.

Congress must work to make 2015 another great year for medical innovation. It can start by rejecting Sen. Warren’s misguided bill.

Sally C. Pipes is president, CEO, and Taube Fellow in Health Care
Studies at the Pacific Research Institute. Her latest book is The Cure
for Obamacare.

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