Thank you, Chair Durbin, Ranking Member Graham, and members of the Senate Judiciary Committee, for holding this important hearing today.
We appreciate the Committee’s leadership in exploring opportunities to ensure affordable and accessible medications. We share the perspective raised by several witnesses that a healthy prescription drug market rests on strong and dependable intellectual property (IP) protections, along with coverage and payment policies that foster continued investment in R&D.
For 20 years, the Pharmaceutical Industry Labor-Management Association (PILMA) has united the biopharmaceutical industry and union workers with the dual goals of fostering the innovation of life-saving cures and securing high-quality union construction jobs. According to independent estimates, the American biopharmaceutical industry supports over 22 million union labor hours and contributes nearly $800 billion in wages1. Powered by the hardworking men and women of the labor movement, the United States stands atop the world as a bastion of innovation and a leader in the development of new therapies—treating everything from common chronic diseases to rare genetic conditions.
PILMA has long advocated for reforms in the pharmaceutical supply chain, particularly concerning the role of intermediaries like insurance companies and Pharmacy Benefit Managers (PBMs), which directly control over 80% of the market and whose abusive and anti-competitive business practices are significant drivers of high drug costs.
We recommend that Congress take steps to address these practices by decoupling PBM compensation from prescription drug prices, increasing transparency in PBM pricing and compensation practices, and mandating that PBMs pass on savings from manufacturer rebates to patients and plan sponsors. It is also crucial to ensure these reforms preserve federal regulatory controls that facilitate the negotiation of comprehensive multiemployer health benefit plans for union members.
Further, robust IP protections have positioned the United States as a global leader in medical innovation. It is vital that future policymaking safeguards these rights from proposals to weaken them under the pretext of improving affordability and access. Proposals such as invoking “march-in rights” on drug patents and the expansion of the IP waiver at the World Trade Organization for COVID-19 diagnostics and therapeutics could deter R&D investments in the biopharmaceutical sector.
Such measures would impact union construction jobs supported by the industry while doing little to improve access for communities truly in need.
As the Committee continues to explore efforts to improve affordability and access to medications, PILMA urges policymakers to consider practical solutions to promote transparency and fairness in the pharmaceutical supply chain while steering clear of measures that threaten American biomedical innovation and the jobs and job training supported by this sector.
- institute for Construction Economic Research. An Analysis of Construction Spending in the Pharmaceutical & Biotech Industry 2015-2020. https://unionjobs.pilma.org/wp-content/uploads/2021/06/PIL-D-2106-Full-Jobs-Report_FINAL.pdf ↩︎