The Biden administration is making a concerted effort to address the issue of high prescription drug prices by proposing a groundbreaking strategy involving the use of “march-in” rights on patents for costly drugs. The initiative aims to ensure that taxpayer-funded inventions result in prescription drugs that are accessible to the public at reasonable prices.
The federal government annually invests billions of dollars in biomedical research, which often leads to the development of prescription drugs. Activists have long advocated for the use of march-in rights when taxpayer-funded inventions do not become publicly available on fair terms. March-in rights would allow the government to license certain patents of expensive drugs to other companies, facilitating the sale of these drugs at more affordable prices.
Despite previous requests being declined, including for the prostate cancer drug Xtandi earlier this year, the Biden administration is now proposing a framework to guide government agencies on employing march-in authorities. This move represents a significant step toward addressing the pervasive issue of exorbitant drug prices.
During a press call, White House National Economic Advisor Lael Brainard stated, “When drug companies won’t sell taxpayer-funded drugs at reasonable prices, we will be prepared to allow other companies to provide those drugs for less.” The proposal emphasizes that if American taxpayers contribute to the invention of a prescription drug, it should be made available to the public at a reasonable cost.
The Department of Health and Human Services and the Department of Commerce conducted a thorough review of the government’s march-in authorities under the Bayh-Dole Act of 1980, leading to the proposed framework. The announcement kicks off a 60-day public comment period to gather input on the proposal.
However, opponents argue that march-in rights were never intended to address high prices. They emphasize the critical role of the Bayh-Dole Act in fostering public-private partnerships for the development of government-funded research into widely accessible products. Some express concerns that reinterpreting the law could negatively impact innovation.
The proposed framework clarifies that the existing authority to exercise march-in rights can be used if the price of a government-funded drug is deemed excessively high. This represents a departure from the historical dormancy of this government power, signaling a potential shift in strategy to address the escalating costs of prescription drugs.
While the Biden administration has not identified specific drugs for march-in, the mere acknowledgment of its willingness to use this power may influence companies’ behavior, potentially deterring exorbitant price hikes. The proposed framework marks a crucial step in the ongoing effort to curb high prescription drug prices and enhance accessibility for patients in need.