International Pricing Index Proposal Veers Away from Market-Based Principles and Puts Government in the Driver’s Seat

Before the year closed out, the National Association of Manufacturers (NAM) requested the administration reconsider its proposed International Pricing Index (IPI) model for Medicare Part B drugs and urged the administration to maintain free market principles as well as the spirit of open competition. The IPI model, if implemented as designed, would send a strong signal that future treatments should be more limited for patients and controlled by the government, thereby curtailing the incentive for the development of new cures. In the comment, the NAM stressed:

The proposed shift to an international pricing model for certain classes of medicines and treatments highlighted in the ANPRM do not offer a fair or a comparable benchmark for prices in the United States. The HHS/CMS proposal highlights 14 nations, including many with government-run national health systems that operate off a dramatically different set of values and cost controls. Many of these systems differ markedly from the American market-based system that provides consumer choice and honors innovation. Grafting those approaches onto our innovative, free-market economy would be highly problematic, undercutting innovation, failing to reward health outcomes and neglecting to address many of the most important cost drivers in our own health care system.

Manufacturers support a successful and affordable health care system that honors innovation, protects intellectual property and avoids government-driven demands that are contrary to basic free market principles. Health care stakeholders—including makers of medicines and patients—should not be presented with false choices in efforts to improve affordability. Reforming existing programs are important endeavors that must be pursued, but maintaining critical market-based approaches should not be sacrificed in these efforts.

Robyn Boerstling

Robyn Boerstling is the Vice President of Infrastructure, Innovation and Human Resources Policy at the National Association of Manufacturers.

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