[Congressional Record (Bound Edition), Volume 148 (2002), Part 8]
[House]
[Pages 10508-10509]
[From the U.S. Government Publishing Office, www.gpo.gov]




                        PRESCRIPTION DRUG PRICES

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Minnesota (Mr. Gutknecht) is recognized for 5 minutes.
  Mr. GUTKNECHT. Madam Speaker, I rise tonight to talk about an issue 
that the House is going to be addressing in the next several weeks. We 
are going to start having hearings, I understand, later this week or 
early next week on the issue of prescription drugs. What I want to talk 
about tonight is the difference between what Americans pay for 
prescription drugs and what consumers in the rest of the world pay.
  I have on my Website a chart which is absolutely eye-opening when one 
looks at the differences for the 15 most commonly prescribed drugs, 
what we pay in the United States versus what they pay in Europe, and 
let me give one example. My father is 83 years old. He takes a drug 
called Coumadin, which is a blood thinner, and one of the most commonly 
prescribed drugs in the United States.
  In the United States, the average price for a 30-day supply of 
Coumadin is $64.80. That exact same drug made in the same plant under 
the same FDA approval sells in Europe for $15.80. It is four times more 
expensive in the United States. That pattern repeats itself with drug 
after drug after drug. A few years ago when we first started doing this 
research, the price for a 30-day supply of Coumadin in the United 
States was not $68, it was $38. It has gone up by approximately $30 in 
a little over 2.5 years. That is being repeated.
  Last year the amount that Americans spent on prescription drugs went 
up almost 19 percent. That is at a time when the average Social 
Security recipient received an increase of only 3.5 percent.
  It is outrageous. And I am not here to blame the pharmaceutical 
industry. I am not here to say, shame on the pharmaceutical industry. 
They have really done some marvelous things, and we all enjoy better 
health today thanks to the pharmaceutical industry.
  I think we need to pay for the research, but what we are finding out 
more and more is not only do we pay for the research, we pay for the 
advertising, the marketing. We are paying for a tremendous amount of 
overhead, and they still are the most profitable industry listed on the 
New York Stock Exchange. Almost any way it is measured, they are the 
most profitable.
  The American consumer is subsidizing the pharmaceutical industry 
essentially in three ways: First of all, we subsidize them in the 
amount that we spend on basic research through the NIH, the Science 
Foundation, other groups that are doing research. We are subsidizing 
basic research in the United States by over $20 billion a year. That is 
through the taxpayers.
  Then we subsidize them in the Tax Code. When they talk about how much 
they spend on research, that is not exactly the whole story, because 
when they spend that money on research, at least they can write it off 
on the bottom line. Most of these companies are extremely profitable, 
in the 50 percent tax bracket. Half of their research costs, at least, 
are written off. In some cases they qualify for investment tax credits, 
and so they get dollar for dollar. In other words, they write off all 
of the expense on the Tax Code.
  The third way we subsidize the pharmaceutical industry is in the 
prices we pay. Conservatively, we could save American consumers 35 
percent if we simply do what we do with virtually every other product, 
and that is open up the American market so Americans would have access 
to drugs at world market prices. My vision is that the average consumer 
should be able to go to their local pharmacy, deal with their local 
pharmacist, and have this option. If their drug has to come from the 
American inventory, then they would have to pay the American price, 
whatever that is, and we will let the pharmaceutical industry decide 
that.
  But if the pharmaceutical industry is willing to sell drugs like 
Cipro, for example, for half the price in Germany, and that is made by 
a German company, Bayer. Bayer makes it in Germany, and they will sell 
it in Germany for half the price that they sell it for here in the 
United States. If that is the case, at least allow that consumer to say 
to their pharmacist, is there a way we can place this order over the 
Internet and save some money? Then the pharmacist could say, I can 
order this out of a pharmaceutical supply operation out of Paris, 
France; Geneva, Switzerland, and you can save 50 percent, whatever the 
number is.
  The reason this becomes important is our own Congressional Budget 
Office is estimating that American seniors over the next 10 years will 
spend $1.8 trillion.

[[Page 10509]]

  Madam Speaker, if we are correct, by allowing open markets, free 
markets, we believe in NAFTA, GATT, free trade, except where American 
consumers could save the most, if we would just simply open our markets 
and allow that kind of competition, we could save American consumers 
$630 billion over the next 10 years.

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