PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Kerrigan Op-Ed: Ditching Non-Interference Would Hurt Small Businesses

By at 15 December, 2021, 4:00 pm

In an Op-ed running in news outlets nationwide, SBE Council president & CEO Karen Kerrigan reviews the dangers of government price setting for drugs. She also reviews the history and rationale behind Medicare’s “non-interference” clause, which prohibits government officials from negotiating the price of medicines covered by prescription drug plans and what repeal would mean for small companies in this industry and health care consumers generally. She writes:

“Big Pharma” firms would survive, although they’d slash R&D to the bone. Ken Frazier, the executive chairman and former CEO of Merck, estimates that his company would cut research investments by almost 50 percent.

Smaller firms, on the other hand, would go belly-up — or never get off the ground in the first place.

Take it from Amitabh Chandra, director of health policy research at the Harvard Kennedy School of Government. In noting the effort would dissuade venture capital firms from investing in early-stage life sciences, he warned it could prevent the creation of “a transformational drug for Alzheimer’s” or other hugely expensive diseases.

After all, biomedical companies aren’t charities. Just like investors in other industries, the folks who pour capital into biotech firms hope to turn a profit while making the world a better place.

If the government makes that impossible, investors will gravitate to other industries. Companies like Moderna — whose breakthrough mRNA technology helped produce a COVID-19 vaccine in record time — might never be launched.

Both patients and the hundreds of thousands of workers employed by the bio-pharmaceutical industry would suffer. So would U.S. leadership and innovation in this critical industry.

Read the full piece here.

 

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