Democrats' drug price bill blocked in Senate

By Richard Cowan

WASHINGTON (Reuters) - A bill that would let the U.S. government negotiate prices for Medicare prescription drugs stalled in the U.S. Senate on Wednesday when Republican opponents blocked a vote on the legislation.

Senate Majority Leader Harry Reid fell five votes short of the 60 needed to end a Republican filibuster and move to a vote on the bill. A filibuster is a tactic for delaying or obstructing legislation by making long speeches.

Democrats said they were not giving up on the bill and would try again.

Medicare, a government-run health insurance program covering 40 million elderly and disabled Americans, is currently barred from negotiating drug prices with drug manufacturers.

Democrats say government negotiations would save money both for the federal budget and for older Americans by getting the lowest drug prices possible. They note that the Department of Veterans Affairs is allowed to negotiate and gets cheaper prices for some drugs than Medicare programs.

But many Republicans and drugmakers say such a move would limit patient choices and do little to trim prices. Medicare officials also say drug coverage is working fine now and is costing less than expected.

Jon Kyl, an Arizona Republican who has a leadership position in the Senate and serves on the committee that has oversight on Medicare, told reporters that lawmakers "chose access over restriction" in the Medicare drug program.

"Do you want legislation passed that bankrupts drug companies?" Kyl said, arguing that the measure could have discouraged pharmaceutical makers from developing new drugs.

Democrats predicted that Republican lawmakers would feel pressure from elderly Americans who face a steady rise in their monthly medicine bills.

"This is not the end of the debate," said Ron Wyden, an Oregon Democrat.

Wyden said supporters of the bill actually had about 58 votes in favor of allowing the government to negotiate drug prices. He said the additional three votes would come from Democrat Tim Johnson of South Dakota, who has been hospitalized since mid-December for a brain hemorrhage; Reid, who switched his vote at the end so that he could bring the bill up again; and Republican John McCain of Arizona.

Olympia Snowe of Maine, one of six Republicans who joined Democrats in trying to end debate on the bill, told reporters that two or three other Republican votes may also be in play.

"Drug industry profits have soared as they take advantage of legislation that is unfairly tilted toward company bottom lines, not seniors' health. It's time for Congress to put the needs of seniors first," Democrat Edward Kennedy of Massachusetts said.

A report by consumer group Families USA on Wednesday showed prices of the 15 most-prescribed drugs for Medicare patients rose by median 9.2 percent in the past year. For example, a year's supply of Lexapro, an anti-depressant, climbed 15 percent to $812.16 while Fosamax, an osteoporosis treatment, increased 10.7 percent to $806.16, it said.

The report examined the lowest drug prices in Medicare Part D plans offered by the five largest insurers, including UnitedHealth Group Inc. and Humana Inc..