Americans are fighting a drug pricing war. Few understand what’s causing the high drug prices, yet many look up to the FDA.
“We need to focus on solving problems for everyone, not only adjudicating individual problems.” Says Scott Gottlieb, the former FDA commissioner in his speech at the Icahn School of Medicine at Mount Sinai 2019 graduate commencement. Although FDA in history does not regulate drug prices, Gottlieb felt there were more things FDA can do.
“ Gottlieb is a crusader” Say Carrie Schneider, advisor at Pfenex Inc., a company which makes cost effective protein therapeutics and vaccines in San Diego California. His resignation in April 2019 received wide attention due to its contrast to his January twitter: “I am not leaving”.
As the most publicized commissioner in FDA history, Gottlieb is widely known for his publications, TV appearances and twitter posts. His images on TV typically entails him dressing in a dark colored suite paired with his “skeleton polka dot socks”; his black hair combed neatly back from his forehead. Witty and Calm, he brings a lot of popularity among healthcare journalists and press conferences.
“ Driving down drug prices requires a comprehensive approach. But one important route is through competition.” Says Gottlieb in a FDA statement on lowering prices and expanding access to insulin. Gottlieb use the word “market failure” to describe the current situation: lack of product competition and price competition plus a misaligned discount system with rebates in drug distributions. Under his tenure during 2017 to early 2019, there are more generic drugs approved then ever before, with more than 1000 generics approved just in the year 2018.
“The Biosimilar Action Plan released in 2018 is really trying to get more competition there for biologic drugs” Says Carrie Schneider. “We will never know what a reasonable price is until there are a few manufactures compete to provide the same kind of drug product to the market.”
According Gottlieb, moving Medicare part B into part D would invite more drug price competition. In his interview with CNBC, Gottlieb said Medicare part B does not negotiate on drug prices when including specialty drugs into its formulary, which can cause high expenses for patients. “ When you finally have product competition and price competition, the discounting is in the form of back-ended rebates that don’t benefit the consumer who is [paying] out-of-pocket for the medicine,” said Gottlieb pointing to misaligned discounts and rebate, which can generate wrong incentives favoring drug price increase.
Looking back his last 20 years in career advancement, Gottlieb revealed in his speech at Mount Sinai graduate commencement his quest for getting a position that can directly impact healthcare policy issues. “Clarity in political thought is a critical currency.” The former FDA commissioner advised his fellow young alumni. “What helped me most in having those opportunities was my early work writing about health policy; and writing about these matters with a clear and consistent point of view.”
Before he was appointed as the FDA Commissioner, Gottlieb has held various positions ranging from Venture Capitalist and Healthcare Analyst to Clinical Professor and Board Member. Many are skeptical about possible interest conflict rising from his broad connection with the pharmaceutical industry. After his resignation, Gottlieb returned to the American Entrepreneur Institution (AEI), a think tank where he worked with before his FDA tenure. Now he keeps the same position as a Resident Fellow advising on healthcare policy through his publicity. In June 2019, he was elected as independent member of the board of directors of Pfizer.
“ Being a successful commissioner of the FDA requires a set of skills that are hard to find. It requires both understanding the complexities of science and negotiating with the universe of stakeholders – Congress, the White House, drug manufactures, patient groups and scientist. And that leaves out the whole food part of the equation.” Say Gottlieb in 2017 addressing the National Press Club. In his 2019 luncheon appearance, he further brought out the challenges FDA facing in current times when treatments are no longer coming out in a gradual pace but in a rapid and dramatic pace. “It’s a time where in one year, we can bring treating the chronic burden of a disease like sickle cell. And a year later, we’re able to cure the same illness with a gene therapy.”
“ It isn’t just a question of price. It’s fundamentally a question of access.” Gottlieb expanded his point of view in the luncheon meeting. “People’s destiny should not depend on whether they can pay for a cure”. His examples are the most innovative therapies like CAR-T and gene therapy. “ Medicare is slow – and sometimes resistant – payer for new technology.” In contrast, “ the private market has shown a much better ability to incorporate beneficial new innovations than government insurance programs like Medicare and Medicaid.”
As a onetime cancer survivor, Gottlieb is a huge embracer for new technology and innovative therapies. “ Innovation should follow the clinical opportunity. Not payment rules.” Gottlieb lamented on current investor’s concern on backing a new technology. Perhaps it is his position to support innovation, he rarely comments on patent exclusivity granted to companies with brand drugs and later the companies would elongate their patents to fend off competition. However, patent issues do not fall under the FDA’s reign of authority.
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