Yesterday, the House Energy and Commerce Committee debated the merits of H.R.3, a proposal released by Speaker of the House Nancy Pelosi which would radically alter our healthcare system, injecting new government controls and levying steep taxes against private business.

The proposal was developed behind closed doors with no bipartisan input, instead being unveiled by Speaker Pelosi in a press conference. Needless to say, the Speaker is not a member of the committee, which subsequently rushed to take up her proposal without any input from the minority.

The plan hinges on three main policies – capping prices based on socialist price schemes in foreign countries, allowing the U.S. Secretary of Health and Human Services to directly negotiate with private business, and penalizing companies for not negotiating so that they have no choice but to accept HHS’ price.

This isn’t a comprehensive plan, rather a series of proposals which will reduce competition and innovation and ultimately restrict treatment options for patients.

The U.S. leads the world in medical innovation, while patients here have access to more cures than any other market in the world.

This wasn’t always the case and could easily go away if proposals like Speaker Pelosi’s are passed into law.

In fact, during the hearing, Rep. Michael Burgess (R-TX-26), a medical doctor, noted that in the 1980’s “there were treatments available in Europe that were not available in the United States.” That is no longer the case. Rep. Burgess credited the removal of regulatory burdens, such as FDA processes which slow approvals, but equally important is the opposite directions which the European systems and the U.S. system have taken.

In Europe, countries such as the United Kingdom use socialist pricing and government controls, where the government controls care and determines the price they will pay for  medical products and services.

Activists often hold up these systems as “models,” but don’t mention that governments have only two options to control costs when they pay for care: rationing care or restricting access to medicines.

It’s why, “Of 74 cancer drugs launched between 2011 and 2018, 70 (95%) are available in the United States…with 74% in the U.K., 49% in Japan, and 8% in Greece.”

It’s also why one witness at the hearing, Dr. Benedic Ippolito of the American Enterprise Institute, called the direct negotiations in Speaker Pelosi’s plan “negotiations in name only.” In negotiations with the government, the government holds all the leverage, forcing companies to either accept a below-market and unfair price for their intellectual property or to walk away from the deal. Worse, in Speaker Pelosi’s plan, companies that do not accept the negotiated price are taxed, up to 95 percent, on what they do sell in the market, essentially shutting down private enterprise.

More insidious is the chilling effect that this plan will have on future cures.

The price caps and taxes in this plan will slow or even stop investment into new cures, as private businesses adjust their models to the new market. This means fewer research and development projects which lead to new cures.

This isn’t conjecture. It’s fact. Studies have shown that, “cutting prices by 40 to 50 percent in the United States will lead to between 30 and 60 percent fewer R and D projects being undertaken in the early stage of developing a new drug.”

This means fewer new treatments for complex diseases as well as fewer improvements on existing cures. This last piece is key – and often overlooked. Improvements on existing treatments bring down costs while extending lives, as patients can access new treatments for their diseases and as new treatments increase competition in the marketplace.

In fact, Dr. Ippolito cited this in his testimony, noting that a cure for Hepatitis C, in itself unthinkable only two decades ago, was launched and the price for treatment was then subsequently dropped precipitously not because of generic competition, but because new, more effective cures were released.

That’s how the market is supposed to work.

This is also why each witness at yesterday’s hearing underscored the need to protect innovation, as it is universally recognized as vital both to increased quality of life but also to the continued scientific advancement of our medical system.

However, government controls and taxes are not the way to accomplish this goaland in the end will only hurt patients.

Echoing Ranking Member Walden (R-OR-2), we look forward to the House Energy and Commerce Committee returning to regular order and working on bipartisan solutions that will actually help patients and reduce costs. Solutions like passing on rebates directly to patients at the point of sale to realign incentives in the market place or removing onerous regulations to reduce the overall cost of bringing new cures to market. These solutions increase competition – but more importantly provide real relief to American patients now.

That’s what Congress was elected to do. It’s what we hope they get back to, soon.