Back to Blog

Conservative Voices: Beware the Rush to Regulate


As Congress continues to examine the drug supply chain and how to lower prescription drug prices for Americans, critical voices are urging caution about policies that may raise costs for American businesses and consumers.

Former White House Domestic Policy Advisor Joe Grogan published an op-ed in the Washington Examiner questioning Congress’ current approach. Grogan asks whether limiting and restricting the ability of private-sector businesses to provide health coverage aligns with historic Republican policy priorities, writing against policies that would “expand government interference in healthcare [and] pick winners and losers in the marketplace”.

Grogan writes:

“There are two ways to negotiate drug prices: let the private sector do it, as Medicare Part D and the commercial market’s PBMs do, or you can have the government set the prices…PBMs exist to negotiate prices with drug companies and manage drug spending for insurers and employers. The work of PBMs generates value exceeding $145 billion … [PBMs are] playing an undervalued role in the modern American economy.”

Simultaneously, Matrix Global Advisors’ CEO Alex Brill struck a similar tone, writing in a commentary piece that “Republicans and Democrats alike seem eager to regulate [PBMs] without taking the time to fully understand the potential consequences of their own actions.”

Addressing Republican policymakers, Brill goes on:

“To free-market-oriented policymakers (which has long described most Republicans), the case for government intervention rests on an identified market failure. When Republicans push for mandating transparency for PBMs and prohibiting certain PBM pricing strategies, what evidence of market failure are they leaning on?…

“Policymaking can have unintended consequences and is often difficult to reverse. In this case, the risks include outcomes that run counter to the broader objective of promoting competition and affordability across the entire pharmaceutical supply chain.”

As Congress considers action and additional policies, both arguments are a strong reminder of savings that private-sector negotiation plays in keeping health care costs down – and the expensive consequence that may result from a rush to implement the wrong policies.

For more information on how PBMs help Americans and lower health care costs, see the Resources section of our website.