Biopharmaceutical payment and coverage: are cost control policies too restrictive? Industrial Biotechnology...

The use of recombinant DNA technology and monoclonal antibody technology has led to a variety of new "biopharmaceuticals" that aid the body in fighting disease. We are already seeing improvements in patients' quality of life as a result of these new technologies. Often, we also see a lowering of health care costs due to preventing or shortening hospital stays and the reduction of the need for other health care expenditures. However, it is important to recognize that there is also the possibility of an increase in health care costs as the new drugs enable people to live longer, and thus possibly consume more health care services. In recent years, a rising concern has been voiced about the rapid increase in health care spending. Despite vital health and economic benefits made possible by new pharmaceuticals, spending on drugs is a relatively small portion of total health care expenditures. As consumers demand access to high-quality health care, the issue of reimbursement has become highly controversial. As we stated earlier, we recognize that HCFA and other third-party payers have a legitimate interest in attempting to control health care expenditures. However, we are aware that restrictive policies on drug coverage and payment could deprive patients of access to medically necessary therapies and, ultimately, reduce biopharmaceutical manufacturers' revenues to the point where future research is hampered or halted.