For too long, the pharmaceutical industry has threatened dire consequences to innovation whenever efforts are made to control the skyrocketing costs of prescription drugs. When Medicare negotiation was proposed, industry giants warned of a 90% drop in drug development. When patent reforms were suggested, they predicted the end of medical breakthroughs. But it’s time the American people take a closer look at the reality of innovation in this industry — an empty fallacy used to pad executive profits and allow big pharma to keep getting bigger.

This industry’s lobbying juggernaut has its claws in both sides of the aisle in Congress. In 2022, pharmaceutical and health product companies spent $372 million on lobbying — outspending any other industry and accounting for half of all health sector lobbying efforts. They wield this influence to protect their profits, not drive innovation.

The results are staggering: In 2023, the median annual price for new drugs reached $300,000 — a 35% increase from 2022. Between 2022 and 2023, the average price hike for prescription drugs was 15.2% — more than three times the previous year’s increase. Eight in 10 Americans now say the price of prescription drugs is unreasonable, a quarter of adults struggle to afford their medications, and one-third haven’t taken a prescribed medicine due to the cost.

So, what do we have to show for these exorbitant prices? The worst health outcomes of any other high-income country, and health care spending projected to reach 20% of GDP by 2032. The Inflation Reduction Act was the most significant drug pricing legislation in over a decade, finally allowing Medicare to negotiate drug prices. But while Medicare negotiation is a critical first step, it alone cannot address the fundamental dysfunctions in our prescription drug market. We need a comprehensive approach that tackles the industry’s lack of transparency, patent abuse and unchecked pricing power. Here are three essential reforms:

We need transparency on the real costs associated with drug research and development. While pharmaceutical companies frequently cite high research and development costs to justify soaring drug prices, they provide remarkably little data to support these claims. Published estimates for developing a single drug vary wildly from $100 million to $2.8 billion, with no way to verify the true figures. This opacity is particularly concerning given that many breakthrough drugs rely heavily on taxpayer-funded research through NIH grants, yet this public contribution is rarely acknowledged.

We must restrict the anticompetitive practice of “evergreening,” where companies make trivial changes to maintain monopolies. Evergreening is a rampant practice: The top 10 selling drugs on the market today have on average 140 patents filed for each of them and have been granted an average of 74 patents. Other countries have woken up to this abusive use of market monopoly. India’s Supreme Court and the Canadian Generic Pharmaceutical Associations have both called out Novartis for simply taking a molecule from its cancer drug and painting it a different color in order to claim it’s a new version.

Finally, we need cost-effectiveness analyses incorporated into the Food and Drug Administration approval process, rather than allowing prices to be set solely based on what the market will bear. The current FDA process focuses narrowly on safety and efficacy while ignoring the critical question of economic value, essentially giving manufacturers unlimited pricing power regardless of a drug’s actual benefit. We should follow the lead of countries like the United Kingdom, Germany and Australia, which require manufacturers to demonstrate both clinical and economic value.

Rising drug prices affect every American, not just those picking up prescriptions at the pharmacy. Over the past decade, health care premiums have soared by 42%, with prescription drug costs driving one-fifth of that increase. The pharmaceutical industry’s empty threats about innovation cannot continue to stand between Americans and affordable medication. The science of drug development will not grind to a halt with sensible pricing reforms — but millions of Americans’ health will suffer if we maintain the status quo. It’s time to put patients over profits and implement reforms that ensure lifesaving medications are accessible to all.

Madeline Weil is a graduate research specialist at George Washington University’s Milken Institute School of Public Health.