Pfizer CEO Complains to Investors About Lower Drug Prices Under Inflation Reduction Act

Pfizer CEO Albert Bourla is displeased by the legislative sprint to pass the Inflation Reduction Act, the sweeping energy bill financed in part by reductions in the price of key pharmaceuticals.

“I want to say it is very disappointing that they are choosing to single out one industry,” Bourla said during a call with investors last week.

The legislation, said Bourla, includes “specific measures to affect only the pharma industry, particularly when we are out of a pandemic, where this industry has proven the value that brings to public health and to the global economy.”

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The bitter comments about the Inflation Reduction Act — the work of quiet negotiations led by Sen. Joe Manchin, D-W.Va., and Sen. Chuck Schumer, D-N.Y. — reflect the pharmaceutical industry’s opposition to a key financing provision for a range of energy incentive and deficit reduction plans. The legislation aims to finance these programs primarily through changes in the tax code and the revival of a drug price reduction plan from last year.

The drug price plan, which was formulated last year in the House of Representatives, is a compromise measure that falls short of progressive demands for Medicare to directly negotiate the price of all drugs it reimburses on behalf of seniors. Instead, it would allow the Centers for Medicare and Medicaid Services to negotiate the costs of 10 high-priced legacy drugs in 2023, for agreements that would take effect in 2025. Drugmakers that do not participate in the negotiations would face a special excise tax, and the provision contains several exemptions for newly released drugs and certain biologics that have been available for less than 12 years.

Even with the severely scaled-back proposal, major pharmaceutical companies stand to lose future profits. The pharmaceutical lobby, as a result, has mobilized to fight the legislation, and with the powerful fossil fuel industry likely placated by Manchin’s protections, it may pose the bill’s most formidable threat.

Pfizer is among the biggest spenders on lobbying on the congressional negotiations and the drug pricing provision. Many of the company’s 76 lobbyists on retainer have disclosed that they are working on shaping the current legislation. In recent years, Pfizer has gone on a hiring spree of lobbyists, including many former Democratic congressional staffers. Pfizer and Bourla did not immediately respond to The Intercept’s request for comment.

Pfizer is one of the leading opponents of the drug pricing proposal, but other drug industry voices, represented by the lobby group PhRMA, stand united against the legislative initiative. Medicare Part D drugs that could be subject to the drug pricing provision include Bristol Myer Squibb/Pfizer’s Eliquis, AbbVie/Johnson & Johnson’s Imbruvica, Pfizer’s Ibrance, Eli Lilly’s Jardiance, and Astellas Pharma/Pfizer’s Xtandi, all of which are among the most expensive pharmaceuticals with a release date that fits the drug pricing provision formula.

In 2019, Ibrance, used to treat breast cancer, cost Medicare $1.8 billion. That same year, Medicare spent $7.3 billion on the blood clot medication Eliquis and $1.4 billion for Xtandi, a drug to treat prostate cancer.

During his remarks on the investor call, Bourla continued to express disbelief that his industry would face any regulations given its role in the coronavirus pandemic.

“We would be in a very different point in this global economy if we didn’t have the investments in the thriving life sciences sector,” Bourla said. “And they are choosing to single out this industry. I think it’s wrong.”

Yet his complaints about being unfairly targeted after the pandemic come at a time when the pharmaceutical giant is reaping one of the greatest financial windfalls ever from its role in supplying Covid-19 vaccines and antiviral medications. Earlier on the same call, Pfizer executives touted expected sales this year of Paxlovid, Pfizer’s antiviral treatment for coronavirus, at $22 billion. For its coronavirus vaccine, the projected revenue was $32 billion.