PhRMA Statement On Healthcare Reform Coalition

Main Category: Public Health
Article Date: 12 May 2009 - 1:00 PDT

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Pharmaceutical Research and Manufacturers of America (PhRMA) President and CEO Billy Tauzin issued the following statement today on a new healthcare reform coalition:

"PhRMA echoes the sentiment shared by President Obama and members of Congress that it is critical for all Americans to have access to high-quality, affordable healthcare coverage and services. With this central goal in mind, we are working with a variety of healthcare stakeholders to help ensure that a comprehensive healthcare reform bill gets to the White House this year.

"At the same time, we also recognize the importance of tackling the rate of health spending growth. As part of our outreach efforts, PhRMA recently joined forces with a coalition of other healthcare providers to develop consensus proposals aimed at creating a stronger, more stable healthcare system. We appreciate that all healthcare stakeholders will need to make changes that help lower the growth of overall health costs.

"Improving the population's health through public health initiatives, continuously improving quality of care, encouraging advances in medical treatments, encouraging delivery system changes that foster adherence to evidence-based best practices and therapies that reduce hospitalization and manage chronic disease more efficiently and effectively, and reducing under- and over-use of health care are key elements of the proposals to contain overall cost growth.

"PhRMA has long-supported public health initiatives to turn back the epidemic of chronic illness that is driving up health costs. Reducing the need for healthcare services because fewer Americans have costly conditions like diabetes and heart disease will pay both human and economic dividends. Today, treatment of chronic conditions accounts for nearly 75 percent of all healthcare spending. The President's call for a new focus on disease prevention will help transform our sick-care system into a 21st century healthcare system.

"A focus on improving quality of care and adherence to evidence-based best practices that manage chronic disease more efficiently can help improve the way medicines are used. Evidence shows that proper use of medicines can be one of the most effective ways to achieve better health outcomes and reduce costs. For example, non-adherence to prescribed medicines has been estimated to cost $100 billion-$300 billion annually, including costs from avoidable hospitalizations and nursing home admissions. Addressing this issue is part of a quality-focused way to lower healthcare cost growth.

"The coalition also recognizes the importance of encouraging medical innovation as a key element in both improving patient health and reducing the growth of overall health costs. Preserving policies that foster innovation -- both technological innovation and innovative approaches to service delivery -- is critical as we work to improve our healthcare system.

"For example, recent research has estimated that delaying the onset or slowing the progression of Alzheimer's disease by five years could save $126 billion by 2025 in Medicare and Medicaid costs. Without the development of new treatments, the number of cases of Alzheimer's -- and the related costs -- could increase dramatically. America's pharmaceutical research and biotechnology companies currently are working on more than 90 medicines for Alzheimer's, which could afflict 16 million people by 2050 unless a cure or preventative approach is found.

"PhRMA member companies also are answering President Obama's challenge to stamp out cancer in our lifetime. A record 861 medicines and vaccines are currently being researched and developed for cancer, compared to 124 in development for cancer in 1993, the last time Congress took on healthcare reform.

"Our commitment to innovation is unfaltering, as reflected in the record $65.2 billion invested in R&D by pharmaceutical research and biotechnology companies last year.

"Prescription medicines currently account for only 10 cents of every healthcare dollar spent in the U.S., according to the Centers for Medicare and Medicaid Services (CMS). This 10% share of health care costs is projected to continue through 2018.

"In its most recent analysis of national health spending, CMS reported that overall spending growth in 2007 was at its lowest rate since 1998 -- and attributed half of the decline to lower growth in prescription drug spending. In 2007, retail spending on prescription medicines grew by 4.9% -- well below the 6.1% growth rate for health care overall, CMS said. What's more, recent data from IMS Health show that spending on prescription medicines in the U.S. last year increased by 1.3% -- the lowest growth rate in 48 years.

"PhRMA looks forward to working with Administration, Congress, the coalition members and other healthcare stakeholders on ways to help get a comprehensive health reform package on the President's desk this year."

The Pharmaceutical Research and Manufacturers of America (PhRMA) represents the country's leading pharmaceutical research and biotechnology companies, which are devoted to inventing medicines that allow patients to live longer, healthier, and more productive lives. PhRMA companies are leading the way in the search for new cures. PhRMA members alone invested an estimated $50.3 billion in 2008 in discovering and developing new medicines. Industry-wide research and investment reached a record $65.2 billion in 2008.

Source: Pharmaceutical Research and Manufacturers of America