Prescription Drug Costs

Floor Speech

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Mr. GRASSLEY. Mr. President, I am here today to visit with my colleagues about a group that we refer to as pharmacy benefit managers, but around Washington, the shorthand for that term is PBMs.

Many Americans may not know about PBMs. They are very obscure in the whole pharmaceutical business. Yet the PBM market is nearly $500 billion, and they are powerful in our pharmaceutical drug supply chain.

It is our duty in Congress to understand, first, how PBMs operate; second, hold them accountable; and, third, work to lower prescription drug costs for the taxpayers and for the consumers.

In 2018, I pressed the Federal Trade Commission to investigate PBMs. I saw the ongoing consolidation in the pharmaceutical supply chain and its impact on drug prices, driving those prices up. But I didn't wait for the FTC to act.

I have pursued, one, bipartisan legislation; two, held hearings; and, three, conducted oversight. Most recently, Senator Cantwell and I have introduced the PBM Transparency Act. This bill prohibits PBMs from engaging in spread pricing. This is a situation where PBMs charge an insurer more than they charge the pharmacy and then they pocket the difference. Iowans call that gaming the system.

Another practice we prohibit in our bill: clawbacks. In Medicare Part D, these are sometimes called retroactive direct and indirect remuneration fees--or DIR, for short.

Iowa pharmacists have told me clawbacks are costing patients more in higher copays and also costing the local pharmacy. This practice is putting rural and independent pharmacists out of business. In addition, our bill will incentivize fair and transparent PBM practices, benefiting consumers and taxpayers.

The bill has the support of community pharmacists, manufacturers, and patient advocacy organizations. Not surprisingly, this industry we call PBMs oppose the Cantwell-Grassley bill. They say my bill is ``anti- competitive'' and, in their words, an ``expansion of power at the FTC.'' They also claim that their industry is already well-regulated. Nothing could be further from the truth.

My bill establishes transparency and accountability. So good news: Tomorrow, the Commerce Committee will mark up the PBM Transparency Act. I don't happen to sit on this very important Commerce Committee, but I urge my colleagues to support this bill.

Finally, I have never given up on passing the bipartisan Wyden- Grassley bill, known as the Prescription Drug Pricing Reduction Act. Despite the Democrats having the majority for 18 months, we have not passed a prescription drug bill. So we still have high prescription drug prices.

By now, I would assume they would be interested in advancing a bipartisan prescription drug bill. They can get 60-plus votes, save the taxpayers $95 billion and seniors, who are consumers, $72 billion-- rather than a partisan effort that doesn't have 60 votes here in the U.S. Senate.

I want my colleagues to know I will work with anyone who wants to pass the bipartisan Wyden-Grassley bill.

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