HERZOG: Labor Unions And Big Pharma Are Colluding To Raise Drug Costs

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Ashley Herzog Contributor
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On Monday, the Biden administration held a listening session to hear about the so-called need for the government to regulate groups known as Pharmacy Benefit Managers (PBMs). It’s little wonder why: regulating PBMs is a priority for far-left unions and Big Pharma — two of the most powerful interest groups that support the president and his party financially

You’ve probably never heard of PBMs — and if you have, it was probably through an ominous, rushed television ad you didn’t understand. 

Their name sounds complicated, but they’re really not. PBMs are just groups that health plans voluntarily hire to negotiate against Big Pharma, lowering drug costs. They’re good at it too. Last year, the National Bureau of Economic Research’s Casey Mulligan (the former chief economist of President Trump’s Council of Economic Advisers) found that their negotiations save the American people billions of dollars annually. 

While the cost-savings PBMs accrue are great news for average Americans, they’re not so great for Big Pharma and its ability to keep prices sky high. That’s why Big Pharma has spent millions attacking PBMs through advertising and lobbying. They want the government to make it more difficult for these groups to help our health plans save us money.

The greedy far-left unions are also not huge fans of PBMs, as they fear that the restraints these groups put on the drug companies’ price-gouging could yield adverse financial outcomes for the conglomerates they represent. As such, they’ve aligned themselves squarely with Big Pharma in this fight.

Being the good socialist he is, independent Vermont Sen. Bernie Sanders introduced a bill, the Pharmacy Benefit Manager Reform Act, to do the bidding of two of the far left’s favorite interest groups. Sanders and his Biden administration allies like to pretend that most of the healthcare industry supports his legislation, but this characterization is wholly disingenuous. Many of the so-called healthcare advocacy groups supporting this deal have ties to Big Pharma, Big Labor, or both.

Take, for example, the Pharmaceutical Industry Labor Management Association. While it claims to be a grassroots coalition of labor and pharmaceutical groups that aims to “create good-paying jobs and life-saving medicines,” it only lists four partners on its website, all of which are affiliated with or received significant donations from PhRMA — Big Pharma’s trade association. Over a dozen of the group’s trustees also work for large pharmaceutical entities, including PhRMA, Johnson & Johnson, and Pfizer.

Healthcare advocacy group or Big Pharma front? You decide.

The PBM Accountability Project is no different. It claims to bring “together leaders and stakeholders across healthcare, labor, business, pharmacy, and consumer patient advocacy to help ensure that patients or our private and public sector health plans aren’t overpaying for the prescription medicines we need.” But this group is dominated by Big Labor.

The PBM Accountability Project’s chairman is the former International President of the United Food & Commercial Workers Union (UFCW), and its two directors worked (or work) for the International Association of Machinists and Aerospace Workers, Iron Workers International, and the AFL-CIO Executive Board. Is this group’s opinion really one that free-market advocates should trust? 

Big Pharma and Big Labor have never been our allies. The regulations they have pushed over the years have inflated consumer prices, reduced choices, and enriched fat-and-happy executives at our expense. Shame on the Biden administration for doing these groups’ bidding by giving them such a large and open platform on Monday. Republicans in Congress must do everything they can to stop this special-interest power play. 

Some, like Republican Kentucky Sen. Rand Paul, already are. In an op-ed opposing Sanders’ and Biden’s plans, he wrote, “Instead of lowering drug prices, this bill likely will put more money in the pockets of the big pharma CEOs.” He’s right, but it will also enrich the union bosses that Paul’s friends at the National Right to Work Committee continue to fight against. 

Republicans should listen to Paul on PBMs, not two of conservatives’ leading enemies. There’s too much at stake here to do the wrong thing. 

Ashley Herzog is a freelance healthcare writer for the Heartland Institute

The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller.