Sanders also criticized the industry for windfall profits, noting that “10 of the top pharmaceutical companies in America made over $110 billion in profits in 2022.”

A report released Tuesday by the committee’s majority staff found that the median launch price of innovative prescription drugs sold by Johnson & Johnson, Merck and Bristol Myers Squibb — the three pharmaceutical companies represented at the hearing — have exponentially increased their initial prices of new drugs over the past four years when compared with 2004-2008.

That same report also revealed that the three companies set their drug prices considerably higher in the United States than in comparable developed nations. Merck, for example, sells cancer drug Keytruda for $191,000 a year in the United States, but only for $112,000 in Canada and $44,000 in Japan.

Chris Boerner, the CEO of Bristol Myers Squibb, admitted that consumers pay more for their drugs in the United States than those in other countries, but blamed high drug costs on pharmacy benefit managers — the intermediaries between insurance providers and pharmaceutical manufacturers — who push drug prices higher.

“We set the list price, but that list price for Eliquis is driven up by the incentives of intermediaries,” Boerner said. “We would love to work with Congress to bring that down.”

In an interview with Medill News Service, Robin Feldman, a professor of law at UC Law San Francisco, said she “heartily agrees” with Boerner that pharmacy benefit managers play a major role in pushing drug prices higher. But she added that the system benefits the pharmaceutical industry overall.

“The drug companies will point to PBMs as the bad guys, but the system can also work in favor of the drug companies,” Feldman said. “PBMs are able to siphon off a significant amount of money in the supply chain process, but in exchange for that, pharmaceutical companies get preferred positions in the insurance claim.”

During the hearing, Boerner also touted Bristol Myers Squibb’s investment of more than $65 million in research and development over the past decade, arguing that it has bolstered innovation and allowed Americans to gain access to life-saving treatments before the rest of the world.

However, many lawmakers, including Sen. Chris Murphy, D-Conn., noted that Johnson & Johnson and Bristol Myers Squibb spent more in 2022 on stock buybacks, dividends and executive compensation than they did on research and development.

“When you say you’re in the business of saving lives, you have to think about putting patients over profits,” Sen. Patty Murray, D-Wash., added. “Sky-high drug costs are forcing many people, including in my home state of Washington, to choose between filling their prescription and paying for other things they need – essentials like groceries or rent.”

Sen. Maggie Hassan, D-N.H, called out the CEOs for making minor modifications to existing patented drugs to prolong exclusivity in the marketplace, stifling competition and preventing lower drug prices from coming out.

Bristol Myers Squibb has sued to block two approved generics of the blood thinner Eliquis from entering the U.S. market until 2028, even though the original patents on the medications have expired. Merck has already filed 168 patents for its cancer drug Keytruda.

“Merck is using patent gimmicks and loopholes to delay other companies from selling lower-cost versions of this medication, all while raising the price of Keytruda in the U.S. year after year,” Hassan said.