Here is part of a New York Times article, written by Patrick Healy and Margot Sanger-Katz, about that proposal:
With voter fury rising over the high cost of prescription drugs, Hillary Rodham Clintonproposed capping out-of-pocket drug expenses at $250 a month on Tuesday while a rival for the Democratic presidential nomination, Senator Bernie Sanders of Vermont, extolled his own plan and long record for pushing to lower drug costs.
While Republican candidates for the White House want to repeal the Affordable Care Act and generally oppose interfering with the drug industry, Mrs. Clinton and Mr. Sanders are competing fiercely with each other to press for greater competition and new regulations to rein in pharmaceutical companies. Mrs. Clinton announced her patient spending cap as part of a plan that includes requiring most drug makers to spend a defined portion of their profits on research and development, ending tax breaks for pharmaceutical advertising and allowing Americans to import lower-priced drugs from other countries.
“It has gotten to the point where people are being asked to pay not just hundreds but thousands of dollars for a single pill,” said Mrs. Clinton, who laid out her proposals at a forum in Iowa, where she and Mr. Sanders are running closely in opinion polls for the first-in-the-nation caucuses. “That is not the way the market is supposed to work. That is bad actors making a fortune off of people’s misfortune.”
Even before Mrs. Clinton spoke, Mr. Sanders issued a statement reiterating his proposals, made early this month, including letting people buy drugs from Canada and allowing Medicare to negotiate with drug companies over prices (which is also in her plan). He also noted that he has backed medication purchases from Canada since 1999, before Mrs. Clinton joined the Senate. . . .
Several provisions in the plan are designed to change the way pharmaceutical companies structure their businesses. The proposal to establish a set ratio between revenue and research spending, and another that would eliminate the tax deductibility of drug marketing expenses, are clearly aimed at directing the companies to invest more heavily in research than selling their products.
“How can you get the focus to be more on research and less on getting people to take medicines they don’t need?” asked David Cutler, a professor at the Harvard School of Public Health who has advised the Obama administration. He described the Clinton plan as “imperfect” but expected that it would shift drug company priorities.
Other parts of her plan were focused more narrowly on drug prices. One would reduce the amount of time a biologic drug could keep exclusivity, before cheaper copycat products could enter the market. Biologic drugs are different from typical medicines, because they are manufactured from living cells instead of chemicals. That provision would not affect the prices of biologic drugs when they first enter the market, but would limit the drug makers’ period of monopoly pricing.
Another would require drug makers to offer discounts to the federal government when it purchases drugs for patients in the Medicare and Medicaid programs. The Congressional Budget Office estimates that the policy would save the government $103 billion over 10 years.
Like Mr. Sanders, Mrs. Clinton also endorses allowing Medicare to negotiate directly with drug makers for discounts; in the current system, competing private insurers each secure their own prices.
The Democratic candidates are feeling increasing pressure to develop answers for the problem of expensive prescription drugs, which recent polling shows is voters’ top health policy priority. It’s an issue that hits many households’ pocketbooks directly, as rising drug costs are being increasingly passed on to families.
Federal government data shows that drug spending rose substantially in 2014, after four relatively flat years.While the Affordable Care Act, passed in 2010, has brought health insurance coverage to millions of people who did not have it, the law did little to change the way drugs are approved, sold or financed. Now, at the same time that drug prices have been rising, insurance plans have asked individuals to take on a greater share of the burden. A report from the Kaiser Family Foundation, published hours before Clinton’s health care address, documented the shift: Insurance deductibles in employer health plans have grown six times faster than wages since 2010.
That means that more Americans are absorbing the cost of expensive drugs, and many are having difficulty affording the medicines.
Mrs. Clinton’s plan is aimed at addressing both sides of that equation, by trying to discourage drug companies from overcharging for their products while preventing insurance companies from passing along those high prices to consumers.