The Biden administration has determined that it has the authority to seize the patents of certain high-priced medicines, a move that could open the door to a more aggressive federal campaign to slash drug prices.
The determination, which was described by three people familiar with the matter, represents the culmination of a nearly nine-month review of the government’s so-called march-in rights. Progressives have long insisted that those rights empower the administration to break the patents of pricey drugs that were developed with public funds, in an effort to create more competition and lower prices.
The administration will not endorse the widespread use of march-in rights, and is not expected to take action against any individual medicines, said the people familiar with the matter, who were granted anonymity to discuss internal decision making.
Instead, the Commerce Department on Thursday plans to issue a new framework spelling out factors that federal agencies should weigh in determining whether to take march-in action against expensive drugs or other individual products that were created with federal help. The price and availability of that product to the public are among the factors the department will recommend that agencies consider.
The department will seek public feedback on the framework, which is likely to face sharp opposition from pharmaceutical companies that argue it’s illegal for the government to seize its patents and would disincentivize the development of new drugs.
The White House declined to comment.
The administration’s decision comes as Biden officials seek fresh opportunities to lower drug prices and boost competition within the industry, and amid renewed attention on President Joe Biden’s health agenda.
The White House has scrambled to highlight Biden’s health accomplishments in recent days, after former President Donald Trump suggested he would repeal and replace the Affordable Care Act if elected in 2024.
Biden officials now plan to make a fresh push to put health care at the center of Biden’s reelection platform, rolling out proposals in the coming days that would expand on Democrats’ passage of laws capping insulin prices for Medicare recipients and allowing Medicare to negotiate the price of certain drugs. Biden has also portrayed himself as a chief antagonist of the pharmaceutical industry, casting his drug price policies as central to his administration’s battle against “Big Pharma.”
The Commerce Department and Department of Health and Human Services were already expected to issue their determination on the government’s march-in authority in the coming weeks, the people familiar with the matter said. But the announcement was accelerated in the wake of Trump’s comments, and officials are expected to cite it as evidence that Biden continues to search for new ways to lower prices.
The departments launched their review in March, after the administration rejected petitions to use march-in authorities to seize the patent for a prostate cancer drug called Xtandi.
The Xtandi decision prompted criticism from prominent progressives at the time, including Sen. Bernie Sanders (I-Vt.), who later stalled Biden’s nominee for the National Institutes of Health partly over the administration’s reluctance to use its march-in rights.