Press Release

#SubHealth Reviews Complex Drug Supply Chain


WASHINGTON, DC – The Health Subcommittee, chaired by Rep. Michael C. Burgess, M.D. (R-TX), today held a hearing examining the drug supply chain.

“Prescription drugs continue to play a vital role in the United States health care system, from significantly improving patients’ lives to producing health care savings through fewer hospitalizations and medical procedures,” stated #SubHealth Chairman Burgess. “A patient’s access to prescription drugs is a key health care issue for Americans, and within that context is the debate over affordability.”

Energy and Commerce Committee Chairman Greg Walden (R-OR) highlighted Chairman Burgess’ earlier remarks about building off the success of the 21st Century Cures Act and what can be gained from today’s hearing. “In order to fully appreciate the drug supply chain you have to acknowledge its complexity and ask questions instead of jumping to conclusions,” stated Chairman Walden.  “…Listen to the complex journey – from molecular discoveries to patient deliveries – that one dose of medicine takes.”

Hearing from 10 witnesses, #SubHealth dug into the manufacturing of, wholesale and distribution of, and payment for drugs, and how each of these stages impact the cost of medications.

All 10 witnesses listen to member opening statements

Mr. Tom DiLenge, President, Advocacy, Law, and Public Policy, Biotechnology Innovation Organization (BIO), spoke to modern biotechnology, stating, “Overall, our industry has nearly 6,000 new medicines in development for a wide range of life-threatening or debilitating diseases, with 74 percent of these clinical projects targeting new mechanisms of action – so called ‘first in class’ medicines that work in entirely new ways to treat and cure disease.”

Ms. Lori Reilly, Executive Vice President for Policy, Research, and Membership, Pharmaceutical Research and Manufacturers of America (PhRMA), stated, “The biopharmaceutical sector is one of the most research-intensive industries in the U.S.: since 2000, PhRMA member companies have invested more than half a trillion dollars in the search for new treatments and cures, including $65.6 billion in 2016 alone.”

Mr. Matt Eyles, Senior Executive Vice President and Chief Operating Officer for Policy and Regulatory Affairs, America’s Health Insurance Plans (AHIP), stated, “Bold steps are needed, at both the legislative and regulatory levels, to ensure that people have access to affordable medications. With the right solutions that increase competition, choice, and patient control, we can deliver affordable prescription drugs – while at the same time protecting and supporting innovations to deliver new treatments and cures for patients.”

Mr. Mark Merritt, President and Chief Executive Officer (CEO), Pharmaceutical Care Management Association (PCMA) stated, “PBMs [Pharmacy Benefit Mangers] also use value-based contracting to build a network of high-performing pharmacies. …based on negotiated, agreed-upon metrics, PBMs hold pharmacies accountable for performance on certain activities such as generic dispensing, cost-effective dispensing, improving medication adherence, and reducing inappropriate drug use.”

Mr. B. Douglas Hoey, CEO, National Community Pharmacists Association (NCPA), stated, “The current business climate seems to be one in which market power is increasingly concentrated in an ever-shrinking number of corporate entities. The overly concentrated and largely unregulated PBM industry exerts immense influence over how prescription drugs are accessed by the majority of Americans. Given the fact that the federal government is the largest single payer of health care in the United States, it makes financial sense for Congress to demand increased transparency into this aspect of the prescription drug marketplace in order to identify potential savings.”

For more information on today’s hearing, including a background memo, witness testimony, and archived webcast, click here.


Health (115th Congress)
Press Release