This week, the House Energy and Commerce Committee considered pieces of President Biden's $3.5 trillion reconciliation bill, also known as the Build Back Better Act. From Monday through Wednesday, we debated on subtitles related to air pollution, energy, public health, wireless connectivity, and drug pricing among many others.
By passing the President’s Build Back Better agenda, Congress will make bold and generational investments for our communities. However, lawmakers are in the midst of finalizing the elements in this bill. There is yet to be an agreement between the House and the Senate about either the size or scope of those investments. As we work to build this bill, I opposed the drug pricing proposal, H.R. 3, and offered my own alternative. I am confident that we will come together at the end of this to make a historic investment in our future.
Some reporting has implied I do not support lowering drug prices for seniors, but that is false. I want you to hear my position on lowering out-of-pocket costs directly from me.
Concerns with H.R. 3 and the Introduction of the Reduced Costs and Continued Cures Act
Last week, some of my colleagues and I introduced the Reduced Costs and Continued Cures Act. Our proposal would for the first time, limit the out-of-pocket drug expenses of any senior to a maximum of $3,100 per year, and for lower income seniors, $1,200. It would cap insulin expenses at $50 per month.
It would allow Medicare to negotiate for better prices. It would also close patent loopholes abused by drug manufacturers that make it harder for patients to access less expensive generic drugs. And it pays for this by imposing a cap on the price increases drug manufacturers can impose that extends retroactively to 2016, clawing back from pharma companies' excess profits gained since then.
That is why I object strenuously to the deceptive assertion that the reason I opposed the bill was because I want drug prices to stay high. My proposal would achieve exactly the opposite.
The reason I could not support H.R. 3 is because it puts our ability to find new cures in the future at risk. It proposes to have the government set a price, then charge a 95% excise tax against companies who refuse to accept that price. There is very little incentive for an investor to put money into drug development if there is no ability to achieve a return on that investment.
Why is that important? Drug development is a partnership of the public sector and the private sector. Taxpayers invest about $40 billion in the National Institutes of Health each year to do basic research, but we rely on the private sector to invent medicines using that research. In 2018, the private sector invested more than $100 billion in drug development, at no risk to taxpayers. But that investment would not be made if there was no ability to earn a return at the other side.
Who cares about this? The investors who put up the money for drug development have explained how H.R. 3 would dry up investment and cost jobs. In San Diego, this would be devastating. We are the third largest biotechnology cluster in America, where 68,000 are employed in life sciences, mostly doing research. It is my job to protect this pillar of our local economy.
Over 50 rare disease patient advocacy groups – who fight for cures for cancer, ALS, multiple sclerosis, lupus and other autoimmune diseases – have also publicly expressed concerns with H.R. 3. They worry the cures we could lose might be the ones that save the lives of the sick people they fight for. The independent, nonpartisan Congressional Budget Office projected that we would lose cures over time if we enact H.R. 3; independent analysts have suggested the number of cures lost would be far worse than CBO predicts. Those potential cures could be for a rare autoimmune disease that affects only a few, or for a widespread disease like Alzheimer’s.
My proposal is to lower drug prices today -- just like Democrats have long proposed -- while we preserve the ability of American scientists to invent the cures for tomorrow. We have to do both. Our bill would pay for itself and, we estimate, generate another $200 billion to support additional health care coverage. If my bill passes, we would finally provide out-of-pocket relief to seniors for the first time. Please take the time to review my full proposal here.
We agree that we must lower the costs of prescription drugs. I am committed to doing the hard work to create a plan to actually get it done.
Meeting with Constituents
Earlier today, I spoke with constituents from the Ethiopian American community. We discussed their concerns over the conflicts in Ethiopia and the response from the U.S., including President Biden's recent executive order authorizing new sanctions, Rep. Karen Bass' (CA-37) resolution condemning violence and human rights abuses in Ethiopia, and role of the Tigray People's Liberation Front. My constituents also expressed the importance of the African Growth and Opportunity Act. I want to thank those who participated in this meeting and look forward to our continued engagement to serve the Ethiopian American community.
Fireside Chat with Climate Leadership Council
I also spoke with Catrina Rorke from the Climate Leadership Council today. Our conversation focused on the importance of carbon pricing and how it can help us achieve many of our climate goals. I discussed a bill I introduced in July with Sen. Chris Coons (CT), the FAIR Transition and Competition Act, which would establish a border carbon adjustment (BCA) on polluting imports to protect U.S. jobs, reduce global emissions, and support communities that suffer the worst effects of climate change. I also spoke about other climate bills and priorities, bipartisanship, and climate provisions in the reconciliation bill we continue developing.
Meeting with Members of the National Small Business Association of San Diego
This week, I held a round table with members of the National Small Business Association of San Diego to discuss various issues their companies are facing. They mentioned issues with disbursing COVID-19 assistance, access to capital, and proposed changes to the tax code. I was glad to hear from NSBA members once again, and look forward to continuing our conversation in the weeks ahead as Congress debates the budget for our upcoming fiscal year.
If you have any questions, comments, concerns, or need assistance with a federal agency, reach out to us through our website or by calling the district office at 858-455-5550.
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