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Sen. Cruz Can Protect Competition and Capitalism in Our State and Our Country

Texans spend more on prescription drugs than any other state in the nation, accounting for the highest percentage of all prescription drug spending in the United States (U.S). High prescription drug prices aren’t just a problem in Texas – Americans pay more than $4,500 per household on prescription drugs, and pharmaceutical spending has increased by 77% since last decade.

High prices don’t only strain our wallets, they also strain our health. One in four people struggle to afford their medication. This rises to close to one in two for people with serious medical issues. And high prices have human costs: about 31% of Americans have skipped filling a prescription mainly due to price. When people skip filling their prescriptions, their health suffers. Simply put, our drug pricing system is broken. Until something is done, Texans and all Americans will continue to pay more than they need to for life-saving prescription drugs.

Why are prices for new prescriptions so high? In a traditional free market, prices are set by supply and demand. But the market for leading edge life-saving and pain-alleviating drugs, is not a traditional open market.

Big Pharma provides a real service with their new drugs, but they try to maximize their profits in doing so. It starts with the complexity of the price setting methodology. It is not the normal cost-based system most products use. Pharma also uses the legal system to thwart challenges to their patent protected drugs. Each new drug the Federal Drug Administration (FDA) approves receives a specific number of years of monopoly for their drug. They can also apply for extensions to their market monopoly. This power and their deep pockets allow Big Pharma to prevent competitors from entering the market - ensuring they face little competition and giving them abnormal power to set and maintain high prices.

How does Big Pharma do this? By exploiting the patent system. When a company develops a new product, it is awarded an exclusive right, a patent, which prevents other companies from competing for a certain period of time, typically around 20 years. After that patent protection ends, competition can enter the market, increasing competition and lowering prices. However, that’s not always the case because big drug companies work to obtain as many patents as possible on a drug in order to maintain their monopoly far beyond the intended time period and help keep prices high.

Another way Big Pharma maintains pricing power is by paying off generic manufacturers to delay their products from entering the market. Since the United States has yet to regulate “pay-for-delay,” these companies perpetuate the cycle of unethical profiteering and deny patients access to potentially life-saving, low-cost medications.

And since millions of Americans need medication to lead normal lives, and sometimes even to stay alive, they are forced to pay whatever price Big Pharma sets. Most Americans don’t think this is fair. Most Americans are right -- it isn’t fair.

Congress is considering legislation right now that would close these loopholes, lower drug prices by driving competition to the market, and give some relief to Texans who have been struggling to afford their medication for years. Senator Ted Cruz (R-TX) can sign onto legislation right now that will protect competition and, more importantly, capitalism in our state and our country. Senator Cruz has proven time and time again that he’ll do what’s right to protect our state and I hope he will do so again to finally bring down drug prices for every Texan.

About the Author

Joe Barton served in Congress representing the 6th congressional district of Texas from 1989-2019.

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