J&J, Merck and Bristol Myers Squibb CEOs Will Testify at Senate Hearing on Drug Prices

J&J, Merck and Bristol Myers Squibb CEOs Will Testify at Senate Hearing on Drug Prices

The chief executives of three major pharmaceutical companies are set to appear in front of the Senate health committee on Thursday to defend how much they charge for drugs in the United States, drawing them further into a confrontation with lawmakers and the Biden administration over the cost of some of the most widely used prescription medications.

The three executives scheduled to testify — Joaquin Duato of Johnson & Johnson, Robert M. Davis of Merck and Christopher Boerner of Bristol Myers Squibb — are expected to clash with the health committee’s chairman, Senator Bernie Sanders of Vermont, an independent who has made reining in drug prices a signature cause of his late-career years in Congress.

Mr. Sanders plans to focus the hearing on why drug prices are higher in the United States than in other wealthy countries. His staff has singled out several widely used drugs, including Eliquis, a blood thinner made by Bristol Myers Squibb, and Januvia, a diabetes drug from Merck, that can be bought for much less in Canada and Europe than in the United States.

The hearing comes as a new federal program authorizing Medicare to negotiate the prices of some costly medications is getting underway. Federal health officials last week made their initial offers to the makers of the first 10 drugs selected for negotiations, a list that includes Eliquis and Januvia.

Five of the 10 drugs picked for price talks are made by the companies whose executives will be testifying on Thursday. Drug makers, including all three companies that will be represented at the hearing, have filed a flurry of lawsuits arguing that the negotiation program is unconstitutional.

Mr. Sanders has accused pharmaceutical executives of unduly profiting from popular medications at the expense of Americans struggling to pay for prescriptions. He has suggested that the companies use the drugs to enrich their top executives and stockholders.

Two of the pharmaceutical executives, Mr. Duato of Johnson & Johnson and Mr. Davis of Merck, agreed to testify after being threatened with subpoenas. Mr. Sanders had planned to hold a committee vote last week on whether to issue them, but the executives agreed to appear at the hearing before such a vote was taken. The two companies suggested last month that Mr. Sanders was seeking to retaliate for the lawsuits they had filed challenging the Medicare price negotiation program.

Prices for brand-name drugs in the United States in 2022 were at least three times as high as those in 33 other wealthy countries, a recent report funded by the Department of Health and Human Services found, even when taking into account discounts that can reduce how much American health plans and employers pay.

Comparing drug prices in the United States with those in other countries can be tricky because the health care systems are so different. In the United States, negotiations over drug prices are fragmented across tens of thousands of health plans and employers, while European countries rely on a centralized negotiator. And while many prescription drugs can be bought for much less at European pharmacies, European countries do not necessarily offer broad insurance coverage for those drugs for their citizens.

Sarah Ryan, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, or PhRMA, the drug industry’s main lobbying group, said in a statement that new medicines arrived faster in the United States than in any other country. She blamed middlemen known as pharmacy benefit managers for high out-of-pocket costs for Americans.

The three executives set to testify on Thursday are the latest to appear before Mr. Sanders since he became the health committee’s chairman early last year. In March, Moderna’s chief executive testified about the price of his company’s Covid-19 vaccine, and the chief executives of three major insulin manufacturers — Eli Lilly, Novo Nordisk and Sanofi — appeared in front of the committee at a hearing in May.

Michelle Mello, a health policy expert at Stanford Law School, said that lawmakers could use the hearing to build momentum around further legislative action on drug pricing, such as expanding the Medicare price negotiation program to encompass more drugs.

“We could be doing so much more with this tool,” she said.

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