Yesterday, the voters of California had their say. The general election is upon us. It’s Clinton vs. Trump. Fasten your seat belts, folks. This election is going to be fascinating, but it’s not going to be pretty.
Today, we turn to politics, and more specifically, the intersection between politics and policy. In a few minutes, we’ll hear from three Washington veterans. They’ll preview a race for the White House that figures to be unlike anything we’ve ever seen. They’ll talk about the stakes for the biotech industry, which could not be any higher.
Last year, our industry broke a number of important records. We attracted a record amount of venture capital investment, and we saw record follow-on offerings in public markets. The FDA approved the most new therapies in 18 years, the most biologics ever, and the most rare-disease drugs in history.
The only thing that can stop the next wave of new cures is bad policy that spooks investors and starves our scientists of the resources they need. Fortunately, we have a powerful ally on our side in this debate: our record. Some of the biggest breakthroughs of the last four decades were made by firms and researchers in this room.
Thanks to your work in creating 39 FDA-approved anti-retrovirals, HIV is no longer a death sentence. Far from it. With proper treatment, a 20-year-old who tests positive today can expect to live into his 70s. That’s the value of biotechnology.
Hepatitis C has gone from a deadly disease attacking the livers of 3.6 million Americans to an illness with a 90-percent cure rate. That’s the value of biotechnology.
Our therapies are helping doctors treat hundreds of diseases: leukemia, rheumatoid arthritis, multiple sclerosis, cystic fibrosis, lupus, and rare disorders with uncommon names like Pompe and Gaucher. We’ve produced vaccines to protect children from measles, mumps and rubella; diphtheria; whooping cough; chicken pox; meningitis and polio. In the last century, the average life expectancy in the United States rose from 48 to 78 years. It continues to rise and biopharmaceuticals are a big reason why.
Yet during this election season, our industry has become an easy scapegoat for the real and growing problem of patient access to affordable new medications. My friends, we are fighting back. Today we ask each of you to join this fight. Millions of patients are counting on us to deliver the next miracle drug. If our ability to innovate is extinguished, so is their hope.
BIO recently launched a new public education campaign to better tell our industry’s story. It’s part of our comprehensive strategy to refocus the public conversation on the true value of pharmaceutical innovation – a strategy to build more champions among policy makers, patients, and providers.
We will remind elected officials that, despite the rhetoric on drug prices, just one out of 10 biotech companies actually turns a profit. We’ll remind them that 90 percent of biotech clinical research goes toward projects that ultimately fail. We fail, but we don’t quit. We can’t quit. To quit would be to fail all of those counting on us.
We talk a lot in our industry about the biotech ecosystem. We talk about the key pillars of investment, invention and product development. Right now, our ecosystem remains healthy, but it’s fragile and under growing pressure. Even a lone Tweet by a candidate for high office can have unintended, market-moving consequences.
So part of our job must be to educate the press, the public and policymakers about what it takes to raise the capital required to bring breakthroughs to market. You and I know the innovation ecosystem is complicated, but our critics are using this complexity to vilify us. They say, “Drugs cost too much, and the drug companies are to blame.” We respond with peer reviewed studies and the latest investor risk prospectus. Guess who the public believes?
It’s time we simplify our case. That means using the best argument at our disposal: We’re saving lives. That’s why BIO recently launched a new ad campaign called “Time is Precious.” Millions have seen it already, and the response has been off the charts. We’re not just providing people with pills and biologics. We’re giving people time. We made this spot to provoke an emotional response, and that response gives us the opening we need to make policy arguments that move the needle of public opinion in our favor.
We have such a positive story to tell. But our Value Campaign will do more than inspire; it will educate. We’ll tell people what’s happening in the insurance industry. Yes, insurance companies are among our customers, but the customer isn’t always right. Not always. Not when it means shifting drug costs that they should be covering on to patients who can’t afford them. Not when some are abusing specialty tier pricing to drive up their margins by driving sick patients out of their plans.
It’s like that car insurance ad where the woman says: “You pay your premiums like clockwork month after month, year after year. Then you have an accident and – surprise – your insurance company tells you to pay up again. Why pay for insurance if you have to pay even more for using it?”
The truth is that drug prices aren’t rising nearly as fast as many insurance company premiums, deductibles, copays and co-insurance. That’s a fact. Net price growth for branded drugs last year was a mere 2.8 percent. Insurers’ own data shows that three quarters of all premium growth is being driven by increasing payments to hospitals and doctors. Insurers spend about as much on their own administrative costs as they do on all medications combined.
Whether you love Obamacare or hate it, the law’s central promise came down to this: Insurance companies get more customers and patients get more comprehensive care. But when insurers accept patients with pre-existing conditions – only to refuse to cover innovative medications – there’s a name for that: It’s discrimination.
It’s also short-sighted from a business perspective. Effective drug therapies can lower health care costs elsewhere in the system. Prescription drugs can shorten hospital stays. They can prevent surgical procedures. They can speed the patient’s road to wellness and greater productivity. It doesn’t pay to be penny-wise but pound foolish, yet too many payers are doing just that when it comes to refusing to cover new medicines.
We’re not going to let our industry be tarnished by insurance practices that burden patients with unaffordable costs. And we won’t let ourselves be defined by companies like Turing – outlier hedge funds masquerading as biotech firms. That’s not who we are.
The first principle of our industry is making lives better through research and innovation. That’s not going to change. Nor will we be defined by candidates looking for easy applause lines. Look, politics is a tough business. I know. I served in public office for 24 years. But developing new medications is even tougher. Shortsighted price controls and heavy-handed regulation can bring our industry crashing down. We will not let that happen.
So as part of BIO’s Value Campaign, we’ve created a rapid response shop in Washington to beat back misinformation. We’re doing more proactive media – both earned
and paid – to get our message out. We’re going door to door in Congress to educate elected officials. Both chambers. Both parties. We’re engaging the grassroots and the grass tops in key states. We’re amping up our social media presence to amplify your voices. I’ve launched a Twitter account. Please follow me @JimGreenwood.
BIO is a powerful voice for our community. But our strongest voices are found in biotech labs and offices around the country. It’s the people in this room. Our scientists and the patients they serve are the most effective spokespeople our industry has. We must unite and speak with a common voice.
Yesterday morning, you received a blue trifold with a logically organized summary of the points you can use to make our case. I really want you to read this material and get used to making these arguments. More than ever, we need every one of you fully engaged. If you didn’t get a brochure yesterday, you can download it at bio.org.
But we can’t just talk our way out of this difficult environment. That’s why we are leaning forward on policy proposals at the state and federal level. We expect politicians in Washington to work together. So, too, must the healthcare industry. We must find common ground and common-sense solutions to make drugs more accessible and affordable, while preserving incentives for innovation.
At BIO, we’re committed to working with doctors, nurses, patient advocates, drug manufacturers, and insurers. We’re all in this together, and together, we will craft solutions that save and enhance patients’ lives.
The threat we face is real. We’ve come too far to let bad policy unravel a system that has made our biotech industry the gold standard of the world. The election is drawing near. The battle has begun. So much is riding on the outcome. Together we’re going to fight back, and we’re going to win. The work that you do is too vital – too crucial. Thank you for doing it.