PRESCRIPTION DRUG PRICE REVIEW COMMISSION

Executive Summary

PRESCRIPTION DRUG PRICE REVIEW COMMISSION could be part of a National Health Board established under the Clinton Administration's proposed national health care reform legislation. If the administration's proposal calls for review of pharmaceutical prices, the review reportedly will be either one of the functions of the National Health Board or the specific role of a subgroup of the board. Pharmaceutical companies oppose drug price review as conflicting with the free-market philosophy of managed competition, and the industry has lobbied against establishment of a price review commission. However, the National Health Board is a key element of the managed competition concept. Although such a board ultimately may not be authorized to conduct drug price reviews, one is certain to be appointed if anything resembling the Clinton Administration's plan is adopted by Congress. Under the proposal, which might not be released until September, the board would be appointed by the President and charged primarily with reviewing health plan benefits and determining standards for outcomes research and performance measures to help individuals compare competing health plans. Collecting and providing information to consumers necessarily will involve oversight of health care provider practices, and review of the expense of specific therapies, particularly new, higher-priced treatments, could be a natural extension of that authority. If pharmaceutical prices are subject to review under the reformed health care system, industry representatives hope at least to limit the nature of the review to a strictly monitoring capacity and to narrow its scope to new products whose reviews were considered a priority by FDA.