Legislation Targets High Cost of Clinical Trials

With Congressional reformers stymied in efforts to impose curbs on prescription drug prices and reimbursement, some legislators are taking a more targeted strategy by looking to lower the cost of clinical research and drug development. Leading Democrats in the House and Senate have proposed a measure to facilitate access to less costly comparator drugs needed in clinical trials, while another bill aims to increase transparency in the costs of clinical trials to better assess whether high R&D expenses justify high launch prices for new treatments.

The “Discounted Drugs for Clinical Trials Act” addresses complaints that biopharmaceutical companies make it difficult and expensive for competitors to obtain marketed drugs needed to conduct subsequent clinical trials. This includes cancer treatments approved as standards of care that often provide an efficient and informative way to test new cancer therapies. Even more common are the difficulties faced by manufacturers of generic drugs and biosimilars in obtaining brand drugs needed for comparative bioequivalency testing.

To address these issues, the legislation sets up a process for ensuring that eligible firms and investigators can access approved drugs or biologics for research purposes. The manufacturer of the reference product would have to sell a specific quantity of the requested drug to a firm at a price comparable to its cost of production.¹

Another measure calls for more accurate calculation of outlays for clinical trials and overall R&D expenditures to better assess industry spending on drug development and claims that high R&D costs justify high launch prices. For this purpose, annual data on costs incurred from a clinical trial would be added to the ClinicalTrials.gov website, as well as disclosed by biopharma companies in R&D expenditures submitted to the Securities & Exchange Commission.²

Sponsored by the chair of the House Oversight and Reform Committee Carolyn Maloney (D-NY) and Sen. Debbie Stabenow (D-Mich), chair of the Senate Finance health care subcommittee, the measures have gained attention on Capitol Hill and in the research community. The House Oversight panel cites its three-year investigation into pharma R&D spending and company practices allegedly designed to suppress competition from generics. These claims fit a range of efforts by Democrats to enact legislation designed to curb industry practices accused of supporting monopolies able to maintain high list prices.

References

1. https://oversight.house.gov/sites/democrats.oversight.house.gov/files/Discounted%20Drugs%20for%20Clinical%20Trials%20Act%20One%20Pager.pdf
2. https://oversight.house.gov/sites/democrats.oversight.house.gov/files/Pharmaceutical%20Research%20and%20Transparency%20Act%20of%202022%20One%20Pager.pdf