Zachary Brennan

Senior Editor, Endpoints

President Joe Biden on Thursday revealed key details of what he wants to see reformed in the pharmaceutical industry when it comes to drug prices, calling not only for Medicare negotiations, which seems to be at the forefront of Senate plans, but also penalties for companies that hike prices faster than the rate of inflation.

“Change is sorely needed,” Biden said in a statement. And in comments Thursday afternoon at the White House, he said that the government will negotiate based on the company’s cost of R&D that went into the drug, “and the need for a significant profit but that’s still affordable for consumers.”

But he also noted that Congress is working on legislation that might be more narrow than his vision, only targeting a subset of the most expensive drugs.

Senate Finance Committee Chair Ron Wyden (D-OR) is spearheading the drug pricing legislation, which is expected to be included in the $3.5 trillion spending package that Democrats are pulling together. A Wyden aide told Endpoints News that further detail on that legislation will probably come in September as the Senate is passing the budget resolution this week that will set the stage for a reconciliation bill later this year. “Then the forthcoming bill will be released when we return after Labor Day,” he said.

The push from the White House comes as the pharmaceutical industry has generally maintained its promise to not raise drug prices by more than 10% annually, and as their lobbyists have come out in droves to Capitol Hill to stop any sort of legislation that might