Clinton targets pharma ‘price-gougers’ as she pitches US$250 monthly cap on pill costs

US Democratic presidential candidate Hillary Clinton has proposed a US$250 monthly cap on out-of-pocket prescription drug costs and other measures to stop what she called “price gouging” by pharmaceutical companies.

At a campaign stop in Iowa, Clinton rolled out a plan to encourage the development and use of generic drugs and to end pharmaceutical companies’ ability to write off consumer-directed advertising as a business expense.

Under Clinton’s plan, the monthly cap would limit what insurance companies could ask patients to pay for drugs that treat chronic or serious medical conditions.

“We need to protect hard-working Americans here at home from excessive costs. Too often these drugs cost a fortune,” she said in Des Moines on Tuesday, adding drug companies keep the profits for themselves while “shifting the cost to families”.

The Nasdaq Biotechnology index closed down 1.7 per cent on Tuesday after falling as much as 3.5 per cent during the session. It had already fallen 4.4 per cent on Monday after Clinton tweeted her intent to tackle high prices of some drugs.

Citi biotechnology analyst Liav Abraham said that with 2016 presidential candidates taking on steep drug pricing, “companies with less differentiated, more concentrated product portfolios are likely to come under increased political scrutiny.”