The House Oversight and Reform Committee is launching a sweeping investigation into the prescription drug industry’s pricing practices, a major priority of new Chairman Elijah Cummings (D-Md.).
Cummings sent letters to a dozen different companies seeking detailed information and documents about how the companies price their medications. He is billing it as one of the broadest drug pricing investigations in decades.
“For years, drug companies have been aggressively increasing prices on existing drugs and setting higher launch prices for new drugs while recording windfall profits,” Cummings said in a statement.
“The goals of this investigation are to determine why drug companies are increasing prices so dramatically, how drug companies are using the proceeds, and what steps can be taken to reduce prescription drug prices,” he said.
Drug pricing is set to be a top issue among Democrats in Congress this year, and the letters from Cummings were sent ahead of a hearing on drug prices scheduled for Jan. 29 — the first Oversight panel hearing since Democrats took control of the House.
The letters seek information about some of the drugs most often cited as examples of alleged industry price gouging, including Humira, AbbVie’s arthritis medicine.
Cummings said the committee is seeking detailed information and documents on price increases, investments in research and development, and corporate strategies to preserve market share and pricing power.
Cummings is also joining a growing chorus of lawmakers questioning the soaring price of insulin. Insulin was first discovered nearly 100 years ago, and as newer forms of the drug have been introduced, the price has climbed.
Three companies — Eli Lilly, Sanofi and Novo Nordisk — control 99 percent of the world’s insulin, and advocates have been asking them to explain their pricing. According to the American Diabetes Association, the average price of insulin nearly tripled between 2002 and 2013.
The three companies are facing a lawsuit over “deceptive pricing” practices.
The price for a vial of one the most popular insulin brands, Humalog, increased from $21 in 1996, to $35 in 2001, to $234 in 2015, to $275 in 2017.