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Last Monday, Billy Tauzin, president and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), voiced the group's support for President Obama's efforts to reform the nation's healthcare system.
Last Monday, Billy Tauzin, president and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), voiced the group’s support for President Obama’s efforts to reform the nation’s healthcare system. Tauzin said the industry shares Obama’s goal of securing Americans’ access to high-quality, affordable healthcare coverage and services. PhRMA is working with other “healthcare stakeholders” to submit a comprehensive healthcare-reform bill to the president before the end of the year, Tauzin said in a press release.
PhRMA and a coalition of healthcare providers are drafting proposals to reduce the rate of health-spending growth. “We appreciate that all healthcare stakeholders will need to make changes that help lower the growth of overall health costs,” Tauzin said in the press release.
Citing data from the Centers for Medicare and Medicaid Services (CMS), Tauzin implied that the cost of prescription drugs did not contribute significantly to healthcare spending. “Prescription medicines currently account for only 10 cents of every healthcare dollar spent in the US,” he said, adding that the percentage of healthcare spending dedicated to pharmaceuticals was projected to remain stable through 2018.
CMS data show that retail spending on prescription medicines grew by 4.9% in 2007, a rate “well below the 6.1% growth rate for healthcare overall,” said Tauzin. He pointed to IMS Health data showing that spending on prescription medicines in the US increased by 1.3% in 2008, which Tauzin called the lowest growth rate in 48 years.
Preserving policies that encourage medical innovation is an important strategy for reducing the growth of overall health costs, Tauzin said in the press release. “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,” said Tauzin.
PhRMA member companies are responding to Obama’s challenge to stamp out cancer by researching and developing 861 medicines and vaccines, Tauzin said. “Our commitment to innovation is unfaltering, as reflected in the record $65.2 billion invested in [research and development] by pharmaceutical research and biotechnology companies last year.”
Tauzin’s statement followed a meeting between Obama and various organizations focused on reducing the cost of healthcare. Obama spoke with representatives from unions, insurance companies, doctors, and pharmaceutical companies. The groups pledged to cut the rate of growth of national healthcare spending by 1.5% annually between 2010 and 2019. The cut would result in $2 trillion of savings, according to Obama.
Healthcare-reform legislation must contain three basic principles, Obama said in a statement. It must reduce the rising cost of healthcare, preserve Americans’ ability to keep or change their doctors and healthcare plans as they choose, and provide all Americans with quality, affordable healthcare. Healthcare reform will serve as a new foundation for the US economy, and “we can, must, and will achieve [it] by the end of this year,” Obama said.