The United States spent $1.6 trillion on drug research last year, and its total budget for this fiscal year is forecast to top $4.7 trillion, according to the Centers for Disease Control and Prevention.
It’s a lot of money, and it’s also a lot less than the $7.7 billion spent on medical research last month.
It would be a lot more than the current total for fiscal 2018, and even more than that if Congress were to extend its existing spending caps and extend the tax cut for individuals and small businesses.
In short, the federal government spent far less on drugs in fiscal 2018 than it did in the previous year.
But even after accounting for inflation, the drug spending surge has only made matters worse.
We still spend far more on prescription drugs than we do on research.
For example, a year ago, our total spent on prescription drug research was just $4 billion.
In 2018, it was $17.2 billion, according the nonpartisan Congressional Budget Office.
This year, the total spent is expected to surpass $17 billion, which is a whopping $1 trillion difference.
And the difference in spending isn’t just due to the massive increase in the cost of research: The drug industry spent an average of $2,834 per prescription-drug-related patient, up nearly 6% from the previous fiscal year.
In fact, the industry spent nearly $4,000 more per drug than it spent in 2017.
Even the nonpartisan Office of the Inspector General, which has been tracking drug spending for more than a decade, says it will take at least five years for the entire national drug-spending pie to be recovered from the current level of spending.
The latest budget request that Congress passed in December, which extended the tax cuts for individuals through 2021, includes $6 billion to add an additional $200 billion to the Drug Enforcement Administration budget.
But as the administration has pointed out, the real cost of drug research has been borne by consumers.
The number of prescriptions filled by Medicare recipients jumped from 4.6 million in 2016 to more than 6 million in 2019.
Medicare spending on prescription-coverage costs was $3.4 trillion in 2019, a 5.3% increase from the year before, according a study released this month by the nonpartisan Kaiser Family Foundation.
That is the same year in which the U.S. spent the most money on health care.
It is also the year in the last decade that the federal drug program paid out the largest share of its revenues to the pharmaceutical industry.
And yet despite these significant gains in research, there has been little effort to rein in the drug industry’s growing influence in Washington, according of some drug policy experts.
“We have a government that is focused on getting money out of the hands of the pharmaceutical companies and into the hands and pockets of consumers, and I think that has created a vacuum,” said James Gorman, the vice president of the nonprofit Institute for Health Security and Public Policy.
“And that vacuum is filling with people who are going after Medicare and Medicaid, who are trying to push through their own agendas.”
While the industry has benefited from the tax break and spending caps, the administration and lawmakers have failed to take the steps necessary to stop the industry from using their clout to push drug companies to do their bidding.
In May, the Senate approved a bipartisan bill to extend the Bush-era tax breaks for companies that make drugs for Medicare, Medicaid and the Veterans Health Administration, or VHA.
This was the third major tax reform that Republicans have supported, following legislation in the House and a separate bill in the Senate that would also extend the current tax breaks.
The White House is hoping to get a second bill passed this year.
That bill would also end the Bush tax cuts on medical devices, as well as the health insurance tax cuts, which are now extended for employers with more than 50 workers.
It also would make it easier for businesses to sell health insurance plans, with a provision that would allow insurers to offer plans with lower out-of-pocket costs and more coverage options for older people.
But many Democrats, including Sens.
Elizabeth Warren and Joe Manchin, have called for a permanent end to the tax breaks, arguing that they are “the largest giveaway to the drug companies of any form in our nation’s history.”
They have also called for changes to the way Medicare pays for prescription drugs.
In December, the House voted for a bill to create a panel to investigate the use of Medicare Advantage programs to subsidize prescription drugs for patients with pre-existing conditions.
The bill passed the House by a wide margin in March.
The panel, chaired by Rep. Fred Upton (R-Mich.), has been investigating the program for more that two years.
The Upton panel has not made public its findings yet, but Upton’s staff said that the panel’s recommendations have already been implemented