An executive order issued by the Biden Administration last Friday announced the government’s intention to address concentration in the pharmaceutical industry, in order to “promote competition in the American economy, which will lower prices for families, increase wages for workers, and promote innovation and even faster economic growth.”
The Biden Administration said the economy has gained 3 million jobs since January 2021, but despite this growth, corporate consolidation has led to a small number of large companies controlling an increasing number of industries, including the pharmaceutical industry.
the economy has gained 3 million jobs since January 2021, but despite this growth, corporate consolidation has led to a small number of large companies controlling an increasing number of industries, including the pharmaceutical industry.
The White House stated that in addition to limiting opportunities, “inadequate competition holds back economic growth and innovation.” They further explained that “as competition declines, productivity growth slows, business investment and innovation decline, and income, wealth, and racial inequality widen.” In an effort to combat the lack of competition caused by corporate consolidation, the order tackles four areas of healthcare that the Administration says have been the most heavily affected – prescription drugs, hearing aids, hospital consolidation, and health insurance.
The order allows the Department of Health and Human Services (HHS) 45 days to issue a plan that will effectively “combat high prescription drug prices and price gouging.” Other methods detailed in the order concerning lowering drug prices are to support “state and tribal programs that will import safe and cheaper drugs from Canada.” Enforcement agencies have also been ordered to implement antitrust laws vigorously.
Hearing aids are rarely covered by health insurance and can cost more than $5,000 a pair, the fact sheet accompanying the order said;. only 14% of the 48 million American with hearing loss have hearing aids. The new order allows them to be sold over the counter at drug stores, effectively saving Americans with hearing loss thousands of dollars. The order also provides that hospital merger guidelines will be revised, since hospital consolidation has left rural communities lacking convenient and affordable healthcare service. Lastly, consolidation has severely limited healthcare and service options. The HHS has been ordered to standardize plan options so that Americans can more easily comparison shop.