Pfizer CEO bashes Obamacare, defends drug pricing at NPC
Pfizer CEO Ian Read gave a tough assessment of the insurance industry and the Affordable Care Act while defending the pharmaceutical industry’s aggressive pricing practices at a March 23 speech at a National Press Club luncheon.
Read said Pfizer has not taken a position on the Republican’s now unsuccessful attempt to repeal and replace the ACA, but indicated the elimination of the Obama-ere healthcare reform is not a great concern.
"No one is using our medicine on the exchanges because the exchanges don't provide them access," he said. Providing everyone on the exchange with Pfizer medications for free would cost the company $40 million per year. "In a $52 billion corporation that's nothing," he said.
Read added that the ACA has pushed into existence plans that don't cover pharmaceuticals on a first-time basis and offer $6,000 deductibles.
He also criticized the insurance industry, saying the payers seek to exclude unhealthy patients from their plans. He pointed to Pfizer's smoking cessation medication Chantix. According to the CEO, insurance companies didn't offer reimbursement for medication out of a fear that it would attract smokers to their plans.
Read also addressed drug pricing, which has been the object of consumer anger. Read said he prefers the U.S. pricing system to Europe's government-led market, where governments do most of the drug purchasing.
"It's an oxymoron saying you negotiate with governments, you don't negotiate with governments. You take what they offer if you've already got all your investments sunk," Read said.
He accused Canada and European countries of "free-riding" off American innovation by forcing pharmaceutical companies to accept below market prices for their medications.
Without the American healthcare system, and its higher drug prices, which help fund research and development programs, there would be fewer innovative medicines, Read said. The cost of medicines is not in the pill, he said, but in the science and knowledge that went into its creation.
The CEO defended high drug prices on the basis of the high cost of research, saying that the pharmaceutical industry spends six times as much on research and development as a percentage of sales than other major industries.
In addition, he cited Pfizer's breast cancer drug Ibrance, and Gilead's hepatitis C medicine Harvoni as examples of innovative treatments that are improving lives. He noted that at $40,000 per year, the cost of Harvoni has been cut in half since its launch due to competition.
Read stressed that industry takes a lot of risks, many of which don't pay off.
Recently seven new drugs for melanoma have hit the market, while 96 "candidates" have been unsuccessful. The numbers for brain cancer are three successful and 75 unsuccessful, and for lung cancer 10 have made it to market, while 167 did not, he said.