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HR3 proposes to replace the current market-based system for determining the value of prescription medicines with a system based on international reference pricing. If enacted, these policies will import to the US price controls adopted by countries with health care systems that deny patients access to the newest cures and treatments.
BIO conducted a study that found implementation of reference pricing in the US would
- Reduce earnings of impacted companies by 62% on average (by 95% for 1/3)
- Markedly reduce biopharmaceutical companies’ investments in smaller company R&D
- Reduce by 90%+ the number of medicines developed by small and emerging biotechs (61 fewer medicines over 10 years)
- Create large investment ecosystem losses to smaller companies in 19 states
- Disproportionately impact new treatments in rare diseases, oncology, and neurology
- Eliminate nearly 200,000 biopharmaceutical industry jobs, and nearly 1 million jobs across the economy
BIO acknowledges current challenges with drug prices and recommends that policymakers a) address perverse incentives in the insurance system, b) increase competition, and c) lower out-of-pocket costs for patients.
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