Guest columnists John Lechleiter and Chris Rivera argue that price controls being considered for the Medicare Part D prescription-drug program could hurt innovation, including in Seattle's biotechnology industry.
NEARLY 50 years ago, the millions of people who flocked to the Seattle World’s Fair got a glimpse of the future in an exhibit called the World of Tomorrow. They saw marvels like a kitchen with disposable dishes, windows that opened and closed automatically, and gyrocopters whizzing commuters to work.
While we’re still waiting for gyrocopters, Washington has become the fifth-largest life-sciences cluster in the U.S., part of a thriving industry that, since the World’s Fair, has helped add 10 years to life expectancy across our country and driven economic growth across the region.
Across the nation, the life-sciences sector, directly and indirectly, supports more than 4 million jobs and generates some $644 billion in economic activity.
According to the report “Trends In Washington’s Life Sciences Industry” released this week, Washington state in 2010 accounted for more than 33,000 of these jobs directly and an additional 57,000 that support the industry — more than 90,000 jobs total. The sector generates more than $10 billion in state economic activity and another $6.6 billion in personal income for Washington residents.
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But in the other Washington, our elected leaders in Congress could be putting these tremendous health and economic gains at risk.
The Joint Select Committee on Deficit Reduction — aka the congressional supercommittee — is considering a policy that would hurt jobs, restrict access to innovative treatments and increase Medicare costs for seniors. They’re debating price controls that would radically alter the Medicare Part D prescription-drug benefit.
The irony is that Medicare Part D — which provides drug coverage for 27 million older Americans — works exceedingly well and is saving the government billions of dollars each year. For one thing, Part D costs 41 percent less than originally forecast in 2005 — how many government programs can say that? Equally important, a recent study says Part D patients who did not have prior prescription-drug coverage save the Medicare program $1,200 annually. That’s because medicines prevent more costly surgeries, hospitalizations and extra doctor visits.
It’s no surprise that 88 percent of enrollees say they’re highly satisfied with the program and 95 percent say the program works well.
Addressing our debt crisis is important, but Congress should focus on scrapping programs that don’t work — not undermining one that is a model of efficiency and effectiveness.
Price controls could bring more than $100 billion to the federal government — but at a tremendous cost. The price tag for bringing a single new medicine to market exceeds $1 billion. So $100 billion less for medical innovators means some 100 potential new treatments delayed or not developed at all.
It’s impossible to know which they would be: treatments to slow the progression of Alzheimer’s disease, improve diabetes care, or extend the lives of people with cancer? While we can never be certain, these could be among the casualties of the decisions our leaders on Capitol Hill are considering now.
Instead, we must foster — not undermine — medical innovation. Even in the face of economic challenges, researchers in Seattle and the rest of Washington are working tirelessly to find the next medical breakthroughs. Advances in the life sciences give them more opportunities than ever before. Siphoning money from these activities will only stifle that research.
We know that a system — and policies — that reward medical innovation, coupled with the same sense of wonder and aspiration that animated the 1962 World’s Fair, is our ticket to a healthier population and a healthier economy. And who knows what the next 50 years could bring?
Chris E. Rivera, left, is president of the Washington Biotechnology & Biomedical Association. John C. Lechleiter is chairman, president and CEO of Eli Lilly and Company.