Good Day BIO: 2 things about drug prices (and 1 about jobs)

Before we head to the BIO International Convention, we have news on inflation and health care costs, the FTC’s plans to investigate pharmacy middlemen, and booming life sciences job growth. And be sure to check your inbox on Monday morning—we’ll be coming to you live from San Diego with something special! In the meantime, you can follow along on bio.news. (695 words, 3 minutes, 28 seconds)

2 things about drug prices

Overall inflation isn’t hitting drug prices and the Federal Trade Commission (FTC) will finally investigate prescription drug middlemen. Here’s what we know.

1. Overall inflation’s not hitting the health sector—and prescription drugs had lower price increases, says a new briefing from the Peterson-KFF Health System Tracker.

As of April 2022, “overall prices grew by 8.3% from the previous year, while prices for medical care increased by only 3.2%. This is unusual, as health prices historically outpace prices in the rest of the economy,” says the report.

What had the largest increases: prices for inpatient hospital services (3.7%), nursing homes (3.6%), and outpatient hospital services (3.3%) all rose faster than overall medical care (3.2%).

What had the lowest increases: prescription drugs (1.7%) and physician services (1.2%).

Why it matters: Policymakers keep talking about drug prices as one of the drivers of rising health care costs, but this is yet more evidence that this just isn’t the reality.  

2. The FTC will investigate the six largest pharmacy benefit managers (PBMs),per an announcement on Tuesday. 

PBMs manage prescription drug benefits on behalf of insurers,as we’ve reported—and the six largest are “now vertically integrated with the largest health insurance companies and wholly owned mail order and specialty pharmacies,” says the FTC.

But here’s the thing:PBMs receive rebates and discounts on drug prices, which they're supposed to pass on to patients—but they often don’t, and in fact limit access via formulary exclusions, harming the sickest patients the most. 

How it will work: The PBMs will be required to “provide information and records regarding their business practices. The agency’s inquiry will scrutinize the impact of vertically integrated pharmacy benefit managers on the access and affordability of prescription drugs”—FTC has more details.

Read More: What are PBMs, anyway?

The life sciences sector is booming, but companies need talent, says report

More people in the U.S. are employed by the life sciences than ever before, with demand continuing to grow—but with low unemployment in the sector, finding talent can be difficult, says a new report from CBRE (H/T Axios). 

The key finding: The number of people engaged in life sciences research grew 79% between 2001-2021, compared with 8% growth for all other occupations in the U.S., says commercial real estate and investment firm CBRE. The sector has the second-lowest unemployment rate (0.6%). 

CBRE has identified 25 clusters of life sciences talent—including the major hubs of Boston/Cambridge, Raleigh-Durham, and the San Francisco Bay Area, as well as smaller pockets of talent like Chicago, Denver/Boulder, Houston, Dallas/Ft. Worth and Minneapolis/St. Paul.

There are many “emerging” talent pools, too—including Salt Lake City, Nashville, Columbus, Albuquerque, and Tucson.

Looking ahead: “The U.S. educational system continues to produce a record number of students with the skills to meet the demands of this sector and to fuel its ongoing growth, sustaining the U.S.’s position as a global leader in the life sciences industry,” CBRE concludes.

But without investment and support, including talent development, “the United States at risk of forfeiting its world-leading position and squandering the entrepreneurial drive and capital market interest that is trying to expand the bioeconomy,” said a recent report from the Schmidt Futures Task Force on Synthetic Biology and the Bioeconomy (with input from BIO’s Sarah Gallo and Erick Lutt).

President Biden’s Friday: The Summit of the Americas continues, where he’s expected to deliver remarks on inflation (1:45 PM ET), join the adoption of a migration declaration, and host a leaders retreat with other heads of state and government. This evening, he’ll attend DNC fundraisers. 

What’s Happening on Capitol Hill: Expect the chatter today to be about last night’s primetime hearing about the January 6th Capitol riot. World Central Kitchen founder and restauranteur Jose Andres will be among those testifying today on the Ukraine response.