Sanders’ Subpoena Brinksmanship

Recent polls have shown that few Americans, regardless of political party are satisfied with the cost, complexity or choices offered by America’s healthcare system.  One would think it might be an opportunity for sound bipartisan policy, as it once was when liberals like Ted Kennedy and Henry Waxman were able to work with conservative stalwarts like Senator Mike Enzi and Orrin Hatch.

Senate Democrats are instead engaging in legal brinksmanship and theatrics more appropriate to a Maoist show trial.

Last week, Sen. Bernie Sanders (I-Vt.), Chairman of the Senate Committee on Health, Education, Labor, and Pensions (HELP), announced the committee will vote at the end of the month on whether to issue subpoena to the CEOs of Johnson & Johnson and Merck to compel them to sit before a hearing on drug prices.

Both drugmakers engaged for months in discussions to help meet the expressed intent of the hearing, offering to send their most knowledgeable experts on drug pricing. But Sanders and HELP Committee Dems spurned the offer and are now threatening subpoena.

The rejection makes it clear Sanders and his colleagues intend to use the hearing room as an arena for congressional blood sport rather than as a forum for fact finding about why Americans pay higher prices for drugs. Sanders the true purpose of the hearing before invitations went out in November, when he said he “wants executives of companies that have sued to be among the witnesses at an upcoming hearing on drug prices.”

It’s no coincidence then, that the three pharmaceutical manufacturers targeted by Sanders are exactly the same companies (no more, no less) that initiated lawsuits against the Centers for Medicare and Medicaid Services (CMS) over the IRA’s price controls for prescription drugs. The lawsuits contend that the IRA violates the Fifth Amendment’s “Takings Clause,” prohibiting government confiscation of property for public use without just compensation. The suit filed by Merck also asserts that in requiring drugmakers to attest that they have negotiated a “fair price,” the IRA violates the First Amendment’s “Free Speech Clause, by putting government preferred speech in their mouths.

Every American and every American company (whether they are popular or not) has a right to have their day in Court. These drug companies are justified in viewing these hearings as blatant retaliation.

While the courts will decide whether the IRA violates Constitutionally guaranteed rights, as many have argued, it’s bad policy regardless. The IRA threatens to turn the clock back on the Orphan Drug Act, Hatch-Waxman, the Prescription Drug User Fee Amendments, the Medicare Modernization Act, and other bipartisan initiatives that provide people around the world with access to life-sustaining medications.

Instead of abusing its senatorial power with public shaming hearings, committee members would make better use of their time and taxpayers’ money by probing truly consequential matters.

The Committee should investigate how many programs to develop new treatments have been shuttered – some even before CMS announced which drugs would be negotiated first. Novartis specifically cited the IRA in announcing its cancelation of some early-stage cancer research programs last year. Members should take note as the rate of program terminations picks up as more drugs are added to the negotiation list.

While it’s at it, the HELP Committee should examine the negative impact that IRA is having on orphan drug development. As many as 135 cures for diseases may never be developed as a result of IRA’s provisions, leading to prolonged human suffering and premature death, according to University of Chicago economist Tom Phillipson.

From a strictly political perspective, HELP Democrats should ask themselves just how far they are willing to go to support a show trial, which this is certain to be. And, if for no other reason than majorities shift, they might consider how low they are willing to set the bar on the use of subpoenas. Here, their friends on the Judiciary Committee have done them no favors.

They should weigh whether they want to be party to retribution against companies for simply exercising their Constitutional right to sue; and given that those suits have yet to be decided, if their questioning might constitute interference.

With many high stakes issues unresolved—not just drug prices but ongoing drug shortages, looming insolvency in Medicare, the destabilization of Part D, and uncertainty about medical innovation—surely the Senate has better things to do than to engage in retaliatory theatrics.

Joe Grogan is a visiting senior fellow at the USC Schaeffer Center and served as domestic policy adviser to President Trump, 2019-20. He consults for the pharmaceutical industry.