Open Markets Releases New Policy Paper on Role of Monopoly in America’s Prescription Drug Crisis
December 9, 2019
Unveils Policy Solutions to Lower Costs and Raise Quality of Prescription Drugs
Washington DC – As Rep. Nancy Pelosi prepares for a showdown in Congress over her Lower Drug Costs Now bill, Open Markets Institute today released The Role of Monopoly in America’s Prescription Drug Crisis. This new white paper exposes how big pharma drives up drug costs through patent monopolies, abuses of regulations, and corporate consolidation. These forms of monopoly thwart competition, stifle innovation, cause drug shortages, and decrease drug safety. Open Markets offers policy solutions for lawmakers and regulators to rein in the outrageous drug prices facing Americans.
“Combating high drug prices is a bipartisan goal, but proposals in Congress often ignore the root causes of the crisis. Two forms of monopoly are preventing fair market competition and keeping prices high. One, big pharma’s patent monopolies drive up prices, drive down innovation, and cause shortages of many key drugs. Two, corporate consolidation in the industry fuels regulatory abuses and enables criminal collusion,” said Open Markets Managing Editor Michael Bluhm, the author of the paper.
The new white paper reveals how monopoly markets for individual drugs are created and perpetuated by a deeply flawed and increasingly abused patent and regulatory system. In conjunction with corporate concentration in the pharmaceutical industry, these monopolies create perverse incentives for drugmakers to focus on rent-seeking ahead of improving public health through developing groundbreaking medicines.
In its paper, Open Markets calls for better public policies to reset the terms of competition and the balances of power in drug markets, so that they serve the public good. The policy recommendations include patent reforms, antitrust enforcement, cash prizes for innovation, regulatory measures to spur competition, and price regulation.