On Sunday, August 7, 2022, the United States Senate passed the Inflation Reduction Act of 2022 in a party line vote with Vice President Kamala Harris casting the tie breaking vote. The legislation now moves back to the House of Representatives. Speaker Pelosi stated, “The House will return and move swiftly to send this bill to the President’s desk ….”
Dr. Michelle McMurry-Heath President & CEO Biotechnology Innovation Organization
Final reconciliation package a “disservice to patients and researchers”
Washington, DC – August 7, 2022
Senate lawmakers today passed a sweeping, $740 billion reconciliation package after an all-night session. Following the vote, Dr. Michelle McMurry-Heath, president and CEO of the Biotechnology Innovation Organization (BIO), made the following statement:
“Nothing we heard from the lengthy floor debate on the Senate floor over the past two days can take away from the fact that every credible analysis of the Inflation Reduction Act comes to the same conclusion: fewer cures for patients. For that reason, we remain in staunch opposition to the government price control schemes included in the final reconciliation package passed today.
“While we have frequently voiced our support for the Part D out-of-pocket cap included in the bill, we have also repeatedly warned of the policy’s drastic and unnecessary blow to cures and therapies. Its passage today has built new barriers to battling current and future deadly pandemics, health inequality, and finding treatments for rare and hard-to-treat diseases.
“Concerningly, small biotech companies, which are responsible for the lion’s share of medical innovation, will bear the brunt of these consequences; these companies rely on a healthy investment environment to stay afloat and bring lifesaving therapies to patients. We applaud those Senators who attempted to exempt the work of these pioneering companies – and the millions of Americans who work within the innovation ecosystem.
“By choking off critical private investment in future R&D for companies of all sizes, the bill will set back the next generation of lifesaving cures and treatments patients are relying on — and cost hundreds of thousands of Americans their livelihoods in the process.
“It also marks a missed opportunity by this Congress to address the true cause of rising out-of-pocket costs for patients. We greatly appreciate the attempt to include reforms to the PBM rebate system that would have helped patients at the pharmacy counter, but unfortunately the bill at final passage remains bereft of any provisions that systematically and holistically tackle the biggest drivers of out-of-pocket costs in our system.
“The price controls passed today are a major disservice to patients and researchers. Looking forward, BIO has and will continue to advocate for pro-science policies that increase patient access to life-enhancing and life-saving treatments while also pushing the boundaries of medical innovation.”
PhRMA’s Ubl Calls Senate Passage of Partisan Drug Pricing Plan a “Tragic Loss for Patients”
“Today’s vote may feel like a political win for Democrats, but it’s really a tragic loss for patients.”
Steven Ubl
President & CEO
PhRMA
WASHINGTON, D.C. (August 7, 2022) – The Pharmaceutical Research and Manufacturers of America (PhRMA) President and CEO Stephen J. Ubl released the following statement after the U.S. Senate passed a reconciliation spending bill, which includes a proposal that would allow the government to set prices for prescription medicines:
“Today’s vote may feel like a political win for Democrats, but it’s really a tragic loss for patients. This drug pricing plan is based on a litany of false promises. They say they’re fighting inflation, but the Biden administration’s own data show that prescription medicines are not fueling inflation. They say this is “negotiation,” but the bill gives the government unchecked authority to set the price of medicines. And they say the bill won’t harm innovation, but various experts, biotech investors and patient advocates agree that this bill will lead to fewer new cures and treatments for patients battling cancer, Alzheimer’s and other diseases.
“They’re also misleading the American people when they say this bill fixes the affordability challenges patients face. This bill provides almost no relief to millions of individuals trapped in an insurance system that discriminates against sick patients. Under this bill, patients will still be forced to pay more for medicine than their insurance company pays. Democratic leaders seized every opportunity to make this bill worse for patients, including giving insurers the green light to raise premiums by six percent and delaying a rebate rule that would provide immediate relief to millions of seniors. When given the choice to stand with patients or insurers and middlemen, Senate Democrats stood by insurers and middlemen.
“Once the government can set prices for life saving medicines, it will demand even more control over the health care of American patients and the collateral damage from this bill will only grow. There is still time to reject this partisan bill and work on bipartisan reforms that lower costs at the pharmacy and protect the hope patients have for new treatments. We urge the House to do what’s needed to stop this dangerous bill and deliver the kind of meaningful patient-centered reforms the American people are counting on.”
Manufacturers Remain Staunchly Opposed to the Inflation Reduction Act
“These new taxes will still deliver a blow to our industry’s ability to raise wages, hire workers and invest in our communities.”
Jay Timmons
President & CEO
National Association of Manufacturers (NAM)
Washington, D.C. – Following the release of the text of the Inflation Reduction Act, NAM President and CEO Jay Timmons released the following statement:
“The NAM remains staunchly opposed to the IRA. It increases taxes on manufacturers in America, undermining our competitiveness while we are facing harsh economic headwinds such as supply chain disruptions and the highest rate of inflation in decades.
“We appreciate that the ‘book tax’ has been revised to reflect the importance of job-creating investments in machinery and equipment. But that is insufficient. These new taxes will still deliver a blow to our industry’s ability to raise wages, hire workers and invest in our communities. In addition, the proposed direct negotiations over prescription drugs are a form of price setting and antithetical to the open marketplace of the Medicare Part D program. Pursuing price control policies could threaten future innovation and cures.
“Any desirable elements of this bill can and should be pursued as standalone legislation. As a whole, the bill simply does not position our industry or our country for future growth or global economic leadership and competitiveness, so we urge all lawmakers to stand with us and reject it.”
Coalition Letter on the Inflation Reduction Act
This Coalition letter was sent to the Members of the United States Senate, with 253 state and local chambers of commerce and national trade associations, opposing the Inflation Reduction Act.
Signatories included: Apache Junction Area Chamber of Commerce, Arizona Chamber of Commerce & Industry, Arizona Manufacturers Council, Buckeye Valley Chamber of Commerce, Carefree Cave Creek Chamber of Commerce, Chandler Chamber of Commerce, Gilbert Chamber of Commerce, Greater Flagstaff Chamber of Commerce; Greater Phoenix Chamber; Green Valley Sahuarita Chamber of Commerce & Visitor Center, Lake Havasu Area Chamber of Commerce, Mesa Chamber of Commerce, Queen Creek Chamber of Commerce, and Tempe Chamber of Commerce
To the Members of the United States Congress:
The undersigned chambers of commerce and business organizations from across the United States urge you to oppose the Inflation Reduction Act of 2022. This legislation includes taxes that would discourage investment and undermine economic growth and price controls that would limit American innovation. Despite the name of the bill, independent analysis confirms that it would have little to no impact on inflation and may in fact increase inflationary pressure in the near-term.
While we understand that various elements of the legislation are being updated, we continue to believe that the following provisions make this legislation unworkable:
- Enacting the proposed Corporate Book Minimum Tax would be the antithesis of sound tax policy and administration. Its introduction would be neither simple nor administrable and would pose a competitive disadvantage to U.S.-headquartered businesses while increasing the incidence of unrelieved double taxation. It would also have a detrimental effect on the quality of financial reporting.
- The excise tax on stock buybacks would only distort the efficient movement of capital to where it can be put to best use and diminish the value of Americans’ retirement savings.
- New price controls on pharmaceuticals would significantly reduce private sector investment in new research. Not only would this provision reduce jobs and hurt the economy, but the non-partisan Congressional Budget Office predicts that it will stifle the introduction of 15 new drugs over the next 30 years.
This is the absolute wrong time to increase taxes on American job creators or implement price controls on American innovators. We urge Congress to reject this misguided legislative package.