Lowering drug prices is a public policy objective that everyone can agree on. About 18 million patients can't afford their prescribed medications, according to a recent poll, including nearly 1 in 5 members of the poorest households. Unfortunately, Congress’ plan to control pharmaceutical prices consists of half-baked proposals that would do serious harm to consumers.
The legislation’s central feature is an elaborate set of price controls — simply put, government-imposed ceilings on what drug makers can charge for their products. Although price controls are a tempting remedy to make medicines more affordable, their historical record is dismal. From 3rd-century Rome to modern-day Venezuela, artificial constraints on prices invariably lead to shortages in the short-run and decreased innovation in the long-run as private companies abandon the market or rein in their investment.
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