Tag: inflation
Johnson & Johnson Sues Biden Over Law Reducing Prescription Drug Costs

Johnson & Johnson Sues Biden Over Law Reducing Prescription Drug Costs

CNBC reports that Johnson & Johnson sued the Biden administration on Tuesdayin an attempt to halt provisions in the Inflation Reduction Act designed to cut the cost of prescription drugs. The suit follows similar legal maneuvering by drug giants Merck and Bristol Myers Squibb.

President Joe Biden signed the Inflation Reduction Act in August 2022 after it passed both houses of Congress with only Democratic votes and over unified Republican opposition. A provision in the legislation allows the federal Medicare program to negotiate drug prices for some of the medications covered by program benefits.

The lawsuit filed by Johnson & Johnson in New Jersey’s federal district court aims to block the Department of Health and Human Services from compelling the company to participate in the federal program. According to CNBC, the company alleges that the legislation is the result of “innovation-damaging congressional overreach.”

Merck sued the administration in June, complaining that the process to lower prices is a “sham.” A week later Bristol Myers Squibb also sued, noting that its blood thinner Eliquis and its cancer treatment Opdivo would be included in price negotiations. Both drugs were significant contributors to the company’s profits in 2022, with a reported combined $20 billion in sales.

The Biden administration has been sued over the prescription drug benefit by the U.S. Chamber of Commerce and Pharmaceutical Research and Manufacturers of America (PhRMA), the lobbyist group for multiple drugmakers.

“We’ll vigorously defend the President’s drug price negotiation law, which is already lowering health care costs for seniors and people with disabilities. The law is on our side,” Health and Human Services Secretary Xavier Becerra tweeted on June 6 in response to Merck’s suit.

Johnson & Johnson, Merck, and Bristol Myers Squibb earn billions from drug sales. For 2022, Johnson & Johnson reported sales of $94.9 billion and $27 billion in profits. That same year, Merck’s net income was $14.5 billion and Bristol Myers Squibb’s was $6.3 billion.

In addition to the drug negotiation provisions, the Inflation Reduction Act also contains other stipulations designed to lower drug costs.

The law requires drug companies to provide rebates to Medicare if drug prices increase at a rate higher than inflation. The Department of Health and Human Services released a list of 43 drugs on June 9 that fall under this provision.

Prescription drug costs are now capped at $2,000 per year in out-of-pocket expenses for many Medicare recipients as a result of the law.

Insulin costs are also capped at $35 per month for certain Medicare recipients. In March, drug manufacturer Eli Lilly announced that it would cap the price of its insulin drug itself, including for patients outside the Medicare system, citing the changes implemented by Biden’s law.

In spite of its benefits for millions of consumers, congressional Republicans on February 3 introduced H.R. 812, a bill that would completely repeal the entire law. Rep. Andy Ogles (R-TN), who sponsored the bill, said in a statement touting his legislation, “Instead of creating any positive change for Americans facing record-breaking economic challenges, Leftists opted to increase federal spending and the deficit – by at least $110 billion dollars through 2031 – in order to advance their personal political agendas.”

During remarks on February 9 at the University of Tampa in Florida, Biden warned about the fallout for medical patients if Ogles’ bill becomes law.

“If Republicans in Congress have their way, the power we just gave Medicare to negotiate lower prescription drug prices goes away. The $2,000 cap next year on prescription drugs goes away. The $35-a-month insulin limitation goes away,” Biden said.

Reprinted with permission from American Independent.

President Biden addresses NATO allies in Poland

Biden Offers 25-Year Plan To Bolster Medicare Finances

In an op-ed published in the New York Times on Tuesday, President Joe Biden discussed his upcoming federal budget proposal and celebrated the Inflation Reduction Act, the 2022 law that included provisions requiring Medicare to negotiate drug prices with pharmaceutical companies. He criticized Republican proposals to repeal the IRA and proposed policies he said would preserve funding for Medicare beyond 2050 without cutting benefits or limiting who can receive them.

Biden wrote:

[M]y budget will extend the Medicare trust fund for more than another generation, an additional 25 years or more of solvency — beyond 2050. These are common-sense changes that I’m confident an overwhelming majority of Americans support.

MAGA Republicans have a different view. They want to repeal the Inflation Reduction Act. That means they want to take away the power we just gave to Medicare to negotiate for lower prescription drug prices. Get rid of the $35 per month cap for insulin we just got for people on Medicare. And remove the current $2,000 total annual cap for seniors.

If the MAGA Republicans get their way, seniors will pay higher out-of-pocket costs on prescription drugs and insulin, the deficit will be bigger, and Medicare will be weaker. The only winner under their plan will be Big Pharma. That’s not how we extend Medicare’s life for another generation or grow the economy.

H.R. 812, proposed by Rep. Andrew Ogles (R-TN), calls for the complete repeal of the Inflation Reduction Act. The legislation has 22 co-sponsors, all Republicans; it has been referred to a subcommittee of the House Committee on Transportation and Infrastructure.

The Inflation Reduction Act authorized the Centers for Medicare and Medicaid Services to negotiate prices with drug manufacturers for the drugs most widely used by those enrolled in Medicare. According to the AARP, the most expensive commonly prescribed drugs include blood thinners Eliquis and Xarelto and diabetes medications Trulicity and Jardiance.

The law also imposed a $35 monthly cap on out-of-pocket insulin costs for Medicare recipients, which took effect on Jan. 1. Senate Republicans defeated a provision to apply the cap to insulin costs for those covered under private insurance. Drug manufacturer Eli Lilly recently announced that it would voluntarily cap the costs of its insulin, and its CEO said the $35 cap "should be the new standard in America."

Biden said that his upcoming presidential budget, to be released later in the week, will expand Medicare's authority as well as policies in the Affordable Care Act, referred to as Obamacare, that also lowered prescription drug prices.

"My budget will build on drug price reforms by strengthening Medicare’s newly established negotiation power, allowing Medicare to negotiate prices for more drugs and bringing drugs into negotiation sooner after they launch," Biden wrote.

Biden said his budget will increase the Medicare tax rate to five percent from 3.8 percent for those with an income above $400,000, including from sources such as investments or trusts. Biden argued, "When Medicare was passed, the wealthiest 1 percent of Americans didn't have more than five times the wealth of the bottom 50 percent combined, and it only makes sense that some adjustments be made to reflect that reality today."

Meanwhile, the House Republican Study Committee offered a fiscal year 2023 budget that would raise the retirement age for Medicare to 67 from the current age of 65. More than 150 Republican House members, a majority of the caucus, are members of the committee.

Sen. Rick Scott (R-FL) in 2022 offered up a "Rescue America" plan that called for all federal laws to expire after five years and be reauthorized by Congress, including Medicare and Social Security. Scott revised his plan on February 17 to exclude the popular programs from sunsetting following months of criticism from Democrats.

Reprinted with permission from American Independent.

Kevin McCarthy

After Six Weeks, Republicans Have Done Nothing About Inflation But Tweet

The Bureau of Labor Statistics released January data on Tuesday, indicating that inflation has slowed compared to a year ago and to December, but prices paid by consumers are still going up. House Republicans, who have yet to take any action to make goods more affordable, marked the day by tweeting about inflation and blaming President Joe Biden and Democratic policies.

Some of them blasted the high price of eggs, a phenomenon being fueled by global bird flu outbreaks, not government spending.

House Speaker Kevin McCarthy called Tuesday "The most expensive Valentine's Day ever," and shared a meme of Biden next to the words "Roses are up, Violets are up… chocolate is up, dinner is up, flowers are up, eggs are up."

Avery Whitehead, deputy platforms director for the White House, responded, "Bummed my partner and I can't sit down to our annual Valentine's Day egg dinner this year."

"President Biden is in denial and has no plan to stop the inflation he started," House Ways and Means Chair Jason Smith said in a press release on Tuesday. "At the Ways & Means Committee, we will look to advance policies which will help workers, families, small business owners, and farmers trying to find relief from the economic hardships created by one party rule in Washington."

But six weeks into Republican control of the House, GOP lawmakers have brought no legislation to curb inflation -- a global phenomenon -- or reduce prices to the floor. The very few economic policy bills they have brought to the floor could actually make the problem worse.

The recent spike in inflation began under then-President Donald Trump in 2020 as the nation dealt with supply chain disruptions caused by the coronavirus pandemic.

House Republicans opposed Democratic legislation to curb inflation in 2022. Not a single one voted for a May 2022 bill that would have cracked down on price gouging, as fossil fuel companies reported record profits in 2022 as prices increased.

Despite united GOP opposition, Democrats enacted the Inflation Reduction Act last summer, investing in energy and climate change infrastructure and reducing the federal budget deficit by hundreds of billions of dollars.

Since its passage, inflation has ebbed significantly, down to 6.4 percent in January from 9.1 percent last June.

While Republicans made inflation a key issue in the 2022 midterm elections and after winning a narrow majority in the House vowed to take action to address it, internal divisions in the Republican Party have led to the stalling of much of their agenda.

Six weeks into the new Congress, Republicans have held 119 roll call votes. Fifteen of those were to decide who would be House speaker. Others have been votes on proposals to overrule the District of Columbia's local elected government, to prevent teleworking by federal government employees, to denounce "the horrors of socialism," and to eliminate COVID-19 safety rules.

They also voted along party lines for a bill to undo provisions in the Inflation Reduction Act that allow the Internal Revenue Service to crack down on wealthy tax cheats. The nonpartisan Congressional Budget Office estimates that if the bill becomes law, it will cost the federal government more than $185 billion in lost revenue over the next decade, significantly increasing the deficit.

And they approved legislation to make it harder for Biden and future presidents to address energy costs spikes by restricting use of the Strategic Petroleum Reserve. Biden successfully used fuel releases in 2022 to drive down gas prices and brought in billions of dollars in revenue to the federal government in the process.

House Republicans have said they will insist on significant cuts to "wasteful government spending," which they say is part of their "commitment" to "fight inflation and lower the cost of living." Thus far, they have offered no specifics about what those cuts will be.

With a Democratic Senate, their bills are unlikely to make it to Biden's desk or past his veto pen.

FAQ:

Q. What causes inflation?

A. Inflation can be caused by various factors including an increased money supply, increased demand without a corresponding increase in supply, rising production costs, and external events like natural disasters or geopolitical conflicts.

Q. What happens when inflation rises?

A. When inflation rises, the cost of goods and services increases, and the purchasing power of money decreases.

Reprinted with permission from American Independent.

McCarthy Blames Democrats For Debt, While GOP Policies Increase It

McCarthy Blames Democrats For Debt, While GOP Policies Increase It

House Speaker Kevin McCarthy blamed the $31 trillion national debt for recent inflation in an address on Monday and demanded "sensible, responsible solutions to our growing national debt," which he called "the greatest threat to our future."

"When debt is too high, inflation is the result. That's where we are today," McCarthy said, according to prepared remarks posted on his official website.

But while McCarthy has previously demanded unspecified spending cuts before he allows the House to take any action to raise the debt limit and prevent a catastrophic default on the national debt, House Republicans are also proposing legislation that would add trillions of dollars to the annual budget deficit.

McCarthy stated on Monday: "If we continue down this path, in the next 10 years, we will spend over $8 trillion just on interest. That's more than the entire federal budget this year. By a lot. That is neither affordable nor sustainable."

McCarthy blamed the spending exclusively on congressional Democrats, who he said "spent your hard-earned tax dollars like those dollars were imaginary." He made no acknowledgment of the fact that about a quarter of the total national debt, nearly $8 trillion, was added while Republican President Donald Trump was in the White House, with the full support of congressional Republicans.

A huge portion of the deficit was the result of Trump's Tax Cuts and Jobs Act, enacted in 2017, which slashed tax rates for rich people and corporations while reducing revenue by what the Congressional Budget Estimated will be $1.9 trillion over a decade.

More was added to the deficit through a series of bipartisan COVID-19 relief packages. McCarthy voted for each of them.

McCarthy said in his remarks: "I think I speak for most Americans when I say, it's time for Washington to change its behavior and act like adults. … We will curb wasteful Washington spending to reduce inflation and return our government to fiscal sanity. We will preserve our ability to defend this nation against threats from abroad. Cuts to Medicare and Social Security are off the table. Defaulting on our debt is not an option."

McCarthy and his caucus in the House have introduced a number of bills that would increase the gap between the nation's annual revenue and its annual spending.

After House Republicans gained the majority in January, their first legislative priority was passing the Family and Small Business Taxpayer Protection Act, a bill which would repeal provisions in last year's Inflation Reduction Act that granted additional funding to the Internal Revenue Service, including for enforcement activities against individuals and companies that evade payment of taxes they owe.

The nonpartisan Congressional Budget Office estimated that the bill would cost the government more than $185 billion in lost revenue over 10 years. McCarthy and all 220 other Republicans present voted for the bill, which passed along party lines. It will likely not be taken up by the Democratic-controlled Senate.

Republicans on the House Ways and Means Committee say on their official website that they will attempt to make the individual tax cuts included in the Tax Cuts and Jobs Act permanent rather than let them expire in 2025 as mandated. An analysis by the Tax Policy Center last November found that such a move would add over $3 trillion to the budget deficit over a decade and that 60 percent of the tax savings would go to the wealthiest 20 percent of American families. McCarthy voted for a 2018 bill to make these tax cuts permanent, but it did not pass out of committee in the Senate.

Rep. Robert Latta (R-OH) filed a bill on January 12 to permanently repeal the federal estate tax, which applies only to those who inherit estates worth more than $12.92 million. According to the IRS, fewer than 6,500 households were impacted by the estate tax in 2019 nationally, but it brought in more than $13 billion in revenue that year.

A day later, Rep. Vern Buchanan (R-FL) filed the American Innovation Act, seeking to expand tax deductions for start-up expenses for businesses. While the Congressional Budget Office has not yet reviewed the bill, it found his 2018 version of it would have reduced revenues by about $5.4 billion over 10 years.

On February 2, Rep. Ashley Hinson (R-IA) and several GOP colleagues reintroduced the Repealing Illegal Freedom and Liberty Excises (RIFLE) Act, which would repeal a $200 excise tax on transfers of some firearms and silencers. This tax cut for gun buyers would result in a loss of tens of millions of dollars in revenue annually.

A spokesperson for McCarthy did not immediately respond to an American Independent Foundation inquiry about whether he personally supports these bills.

President Joe Biden has called on Congress to increase the debt limit without conditions.

Reprinted with permission from American Independent.