Professor Kapczynski Testifies in D.C. on Drug Prices

Professor Amy Kapczynski ’03 testified before the U.S. House of Representatives Ways and Means Health Subcommittee on March 7, 2019 in Washington, D.C. The hearing was titled “Promoting Competition to Lower Medicare Drug Prices.”

Kapczynski outlined how the drug pricing problem is at its core a monopoly problem, where originator drug companies can set high launch prices and increase those prices with few constraints.

“These rights are granted by the government, in the form of patents — which are 20 year rights to exclude others from making, using, importing or selling covered inventions — and other forms of market exclusivity, such as the exclusivities offered to companies via the FDA,” explained Kapczynski. “Although the pharmaceutical industry has historically argued that exclusive rights and high prices are needed to compensate for research and development (R&D), there is growing recognition that prices are not set in relation to R&D. Rather, prices are set in relation to what the market can bear, and that turns not on R&D costs but on the amount of market power a company can exercise.”

Professor Kapczynski went through a list of steps Congress could take to mandate fair pricing, increase competition, and enhance R&D.

“The highest priority for Congress should be legislation that can ensure fair prices in both the public and private sectors, while also ensuring adequate returns to companies,” said Kapczynski. “Also important are a series of measures that can improve competition in pharmaceutical markets, and that can begin to explore alternative R&D structures as well as compensate for gaps in our current R&D system.”

Read Kapczynski’s testimony

Watch the hearing (Kapczynski begins at the 18:40 mark).

Professor Kapczynski is also the Faculty Co-Director of the Global Health Justice Partnership, and Faculty Co-Director of the Collaboration for Research Integrity and Transparency. She is an expert on information policy, intellectual property law, international law, and global health. She has written extensively on the cost of prescription drugs.