Obama health chief: High drug prices are 'problem we must solve'

Obama health chief: High drug prices are 'problem we must solve'
© Greg Nash

Secretary of Health and Human Services Sylvia Mathews Burwell said Friday that high drug prices are “a problem we must solve” as she kicked off an administration forum on the topic. 

“We know that too many Americans struggle to afford the medications they need,” she said. “A recent Kaiser survey showed that almost a quarter of Americans have skipped filling a prescription over the last year.”

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“With an explosion of innovation, we have the opportunity to find new medicines, therapies and cures,” she said. “We have the chance to improve the quality of life for those suffering from diseases today and help prevent many more.” 

The forum exploring solutions to high prescription drug prices is the latest event in a season of increased scrutiny of high drug prices that has put the pharmaceutical industry on edge.

The industry has sought to distance itself from Martin Shkreli, the hedge fund manager who generated a wave of negative publicity by raising the price of a drug to treat a life-threatening infection from $13.50 to $750 overnight.  

Burwell was careful to emphasize both sides of the drug pricing debate. “Together, we can find a path that doesn’t ask us to choose between innovation and affordability,” she said. 

Burwell did mention the possibility of implementing new payment models for Medicare and Medicaid that would pay for a drug based on how effective it is shown to be. 

“We want to hear about new value- and outcomes-based purchasing strategies and best approaches,” she said. “And we want to think about ways that can be implemented by Medicaid and Medicare.”

Some purchasing models with a focus on health outcomes have already been implemented in the private sector. Earlier this month, for example, the insurer Harvard Pilgrim and drug maker Amgen reached a deal where Amgen will be on the hook financially if the cholesterol levels of patients are not lowered enough by a certain drug. 

Bringing outcomes-based models to Medicare and Medicaid would be a major step, and the details of such models would be keenly watched.