AAI Competition Roundtable: Stemming the Tide of Competitive and Consumer Harm in Pharmaceutical Markets

On Wednesday, October 2, 2019, the American Antitrust Institute hosted a competition roundtable ““Stemming the Tide of Competitive and Consumer Harm in Pharmaceutical Markets” at the National Press Club in Washington, D.C.

The roundtable took up competition enforcement and policy issues involving the pharmaceutical industry, their major impact on the healthcare system and on consumers, and policy prescriptions for improving competition. Experts in antitrust and regulation from government, industry, advocacy, and academia framed major competitive issues through the lens of different stakeholder and enforcement perspectives.

The half-day program featured a legislative briefing and two panels followed by a roundtable discussion. The legislative briefing wove together the various pieces of proposed legislation introduced in the 116th Congress involving drug pricing and practices that block market entry and slow innovation. The first panel featured multidisciplinary perspectives to framing responses to stemming the tide of anticompetitive harm in pharmaceuticals, arguably a crisis of epic proportions in our economy. The day closed with a roundtable session that gives participants the opportunity to react to and candidly discuss themes, issues, and policy recommendations for competition enforcement. The second panel examined the burgeoning set of practices and strategies deployed by both branded and generic drug companies that stifle competition and raise prices to consumers.

Panel 1: Promoting Competition in Pharmaceutical Markets – The State of Play on Policy Responses

The opening panel discussed the multidisciplinary perspectives surrounding concerns over competitive and consumer harm in pharmaceutical markets. Drugs represent a significant part of total healthcare spending in the U.S. and an aging population will put additional pressure on the pharmaceutical innovation and distribution system. Given the importance of the pharmaceutical sector, antitrust enforcement will need to be buttressed by a coherent competition, patent, and public health policy framework. Panelists from healthcare, enforcement, and state and federal policy forums wove the major takeaways from the first panel together with their unique perspectives. They discussed the policy implications of the current crisis in drugs and provide insight into the elements of an integrated policy approach to promoting continued innovation, fair prices, and access to drugs by those who need them.

Panel 2: Unpacking the Law and Economics of New Approaches to Limiting Competition in Pharmaceutical Markets

The opening panel examined the burgeoning set of practices and strategies deployed by both branded and generic drug companies that are designed to limit competition and raise prices to consumers. With stronger law regarding pay for delay, drug companies have moved on to newer ways to delay market entry and keep drug prices high. These include practices such as product hopping, sham petitioning, and price fixing. The panel also discussed competition issues in the pharmacy benefit manager (PBM) segment of the supply chain and the potential spillover effects of certain PBM practices into the upstream drug manufacturing sector. Panelists provided perspective and insight into how these issues have been addressed by public and private enforcement, legal victories and defeats in combating abusive behavior, and their implications for competition, consumers, and innovation.