Will 2019 be the year that lawmakers finally address prescription drug prices?
Not if they follow distracting and counterproductive proposals like the one made by Democratic presidential primary candidate Sen. Elizabeth Warren (D-Mass.) last month to get the government into the drug manufacturing business. Warren's Affordable Drug Manufacturing Act would create an Office of Drug Manufacturing that would manufacture select generic drugs at a "fair price."
In typical Warren argot, she justifies her proposal by claiming, “In market after market, competition is dying as a handful of giant companies spend millions to rig the rules, insulate themselves from accountability, and line their pockets at the expense of American families.”
The federal government can't even run the post office or the DMV, yet Warren wants it involved in the enormously complex process of generic drug production. While she implies that eliminating profits and pricing drugs at cost will generate savings, historical experience in every industry shows that the profit motive is the only way to keep costs low.
Yet even if the government could somehow efficiently control the means of drug production, Warren misdiagnosis the generic drug market, which for the most part functions well, dramatically increasing the affordability and accessibility of lifesaving treatments. Generics provide Americans with nine out of 10 of their prescriptions, yet make up only 23 percent of their total spending on drugs.