The US Committee on Oversight and Reform chairman Elijah Cummings has launched an investigation into the drug pricing practices of multiple pharmaceutical companies.
The move comes less than a week after Cummings and fellow Democrats introduced new legislation to reduce the price of prescription medicines in the country.
Go deeper with GlobalData
In this regard, letters have been sent to AbbVie, Amgen, AstraZeneca, Celgene, Eli Lilly, Johnson & Johnson, Mallinckrodt, Novartis, Novo Nordisk, Pfizer, Sanofi and Teva Pharmaceutical Industries.
The Committee is seeking information on price hikes, investment in research and development and corporate strategies intended to protect market share and pricing power.
In the letters, the US lawmaker focused on drugs that are the costliest to Medicare Part D and those that had the largest price increases over a five-year period.
According to the Committee, majority of the financial burden of rising drug prices falls on Medicare Part D, which offers coverage to nearly 43 million people.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataIt is estimated that the US Government would spend $99bn on Medicare Part D this year.
Cummings said: “For years, drug companies have been aggressively increasing prices on existing drugs and setting higher launch prices for new drugs while recording windfall profits.
“The goals of this investigation are to determine why drug companies are increasing prices so dramatically, how drug companies are using the proceeds, and what steps can be taken to reduce prescription drug prices.”
AbbVie and Sanofi received information requests regarding three drugs, while Amgen, Pfizer and Novo Nordisk received requests regarding two drugs.
AstraZeneca, Celgene, Eli Lilly, Johnson & Johnson, Mallinckrodt, Novartis and Teva were asked about one drug each.
Amgen, Novo Nordisk, Celgene and Novartis confirmed receipt of a letter and said they are reviewing the request.
The Committee said that the letters are the first step in its comprehensive review of drug pricing practices.
