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Cummings and Welch Launch Investigation of Drug Companies’ Skyrocketing Prices for MS Drugs

August 17, 2017
Press Release

Washington, D.C. (August 17, 2017)—Today, Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, and Rep. Peter Welch of Vermont, a senior Democrat on both the Oversight Committee and the Committee on Energy and Commerce, sent letters to seven pharmaceutical companies requesting information about their pricing strategies for drugs used to treat Multiple Sclerosis (MS).

“We are launching an in-depth investigation to determine why drug companies are dramatically increasing their prices for drugs used to treat Multiple Sclerosis (MS), which is a disease of the central nervous system that often has devastating and disabling effects on patients,” Cummings and Welch wrote.  “We believe no American should be forced to struggle to afford lifesaving medical treatments, especially when drug companies increase prices without warning, cause, or justification.”

In today’s letters, Cummings and Welch cited an American Academy of Neurology study finding that some drug companies appear to be increasing their prices and setting new, higher prices in lockstep with competitors.  When a company increases its price or introduces a new, more expensive drug into the market, other companies increase their prices to match—or shadow—these higher prices.  This phenomenon is known as “shadow pricing.”

The study reported that annual sales of MS drugs doubled from $4 billion to nearly $9 billion from 2008 to 2012.  At the same time, the cost of the average annual disease-modifying MS therapy was $16,050 per patient in 2004, while the average annual cost of the disease-modifying therapy interferon increased to more than $60,000 in 2015.  

By 2017, many of these drugs have increased in price to more than $85,000 per year.  One drug’s price has increased by more than 1,000% since it was introduced.  

Cummings and Welch requested information to evaluate the substantial price increases of MS drugs, including information about corporate profits and expenses and documents concerning pricing strategies, patient assistance programs, and drug distribution systems.

Letters were sent to the following companies requesting information by August 31, 2017:   

·          Bayer Healthcare Pharmaceuticals, Inc.

·          Biogen

·          EMD Serono

·          Novartis Pharmaceuticals Corporation

·          Sanofi Genzyme

·          Teva Pharmaceutical Industries

·          Roche Pharmaceuticals