CSX said it expects revenue to fall as much as 2% in 2019, well below a previous forecast of an increase of 1% to 2%.Marketsread more
Challenging conditions in the U.S. housing market, along with tighter currency controls by the Chinese government, cause a stunning drop in foreign demand for American homes.Real Estateread more
The growth in net interest income, a main engine of the industry's profit, looks to slow to a halt in the back half of this year.Banksread more
His case for gold comes as central banks get more aggressive with policies that devalue currencies and are about to cause a "paradigm shift" in investing.Marketsread more
Amazon also said that on Monday and Tuesday it sold more Amazon devices — like the Echo Dot, the Fire TV Stick and Alexa Voice Remote — over a two-day period than it ever has...Retailread more
Facebook's head of Calibra David Marcus faced skepticism from lawmakers at a House Financial Services hearing on its digital currency plans.Technologyread more
During a speech on "Medicare for All," Bernie Sanders will urge 2020 Democratic candidates to reject money from health care industries.2020 Electionsread more
The "'Cadillac tax," set to go into effect in 2022, is unpopular with both Republicans and Democrats, who say it punishes the middle class.Health and Scienceread more
The news comes after eBay announced a strategic portfolio review on March 1.The Faber Reportread more
If the S&P 500 climbs another 4%, it will have doubled the peak reached in the previous bull market, Michael Santoli notes.Trading Nationread more
Ascending triangle patterns have been appearing across the stock market, and they tend to be precursors to higher prices, says Miller Tabak's Matt Maley.Trading Nationread more
WHEN: Today, Thursday, August 25th
WHERE: CNBC's "Power Lunch"
Following is the unofficial transcript of a FIRST ON CNBC interview with Iowa Senator Charles Grassley responding to comments made by Mylan CEO Heather Bresch in a CNBC exclusive interview this morning. Grassley spoke on CNBC's "Power Lunch" (M-F, 1PM-3PM ET) today, Thursday, August 25th. Following are links to the interview on CNBC.com: http://video.cnbc.com/gallery/?video=3000546027, http://video.cnbc.com/gallery/?video=3000546029 and http://video.cnbc.com/gallery/?video=3000546030.
All references must be sourced to CNBC.
BRIAN SULLIVAN: NOW BACK TO YOUR TOP STORY TODAY. MYLAN UNDER FIRE WITH THE PRICE INCREASES FOR THE EPIPEN. THE STOCK TURNING NEGATIVE ON THE DAY. IT IS ABOUT DOWN .4 OF 1%. IT WAS UP A COUPLE OF PERCENT EARLIER TODAY. THE COMPANY CEO HEATHER BRESCH TELLING US EXCLUSIVELY THIS MORNING THAT HER COMPANY IS NOT THE ONLY ONE TO BLAME, THAT THE ENTIRE SYSTEM IS BROKEN. NOW, SHE DOES BELIEVE CONGRESS CAN FIX IT AND SAYS SHE WANTS TO TELL THEM HOW.
SOUND FROM MYLAN CEO HEATHER BRESCH FROM CNBC'S "SQUAWK BOX" EARLIER TODAY:
BRESCH: THE LEADERS, THE SENATORS, I'VE CALLED ALL OF THEM. I WANT TO HAVE A FACE-TO-FACE MEETING. PRICE IS ONE PART OF THE PROBLEM. THERE'S NO QUESTION.
SULLIVAN: YOU DO BECAUSE A BUNCH OF BIPARTISAN SENATORS WOULD LIKE TO SPEAK WITH YOU AS WELL.
BRESCH: WELL, THAT'S GOOD BECAUSE THEY HAVEN'T CALLED ME BACK TO SET A DATE. I SAID ANY TIME
SULLIVAN: HAVE YOU REACHED OUT TO SENATORS?
BRESCH: I REACHED OUT TO ALL OF THEM SENATOR GRASSLEY, KLOBUCHAR, SENATOR WARNER.
SULLIVAN: YOU REACHED OUT TO ALL OF THEM
SULLIVAN: IN THE LAST WHEN?
BRESCH: TWO DAYS AGO. I CALLED THEM AND SAID I WELCOME –
SULLIVAN: WHAT DID THEY SAY?
BRESCH: THEY HAVEN'T CALLED ME BACK.
SULLIVAN: WHEN IS THE MEETING?
BRESCH: THEY HAVEN'T SET IT. I SAID AS SOON AS YOU CAN MEET, I'M THERE.
LEE: JOINING US FIRST ON CNBC IS SENATOR CHARLES GRASSLEY OF IOWA, WHO IS CHAIRMAN OF THE SENATE JUDICIARY COMMITTEE. SENATOR THANKS SO MUCH FOR JOINING US.
GRASSLEY: THANK YOU, MELISSA.
LEE: DID HEATHER BRESCH CALL YOU? WHY HAVEN'T YOU CALLED HER BACK?
GRASSLEY: I THINK SOMEBODY FROM THE COMPANY CALLED MY CHIEF OF STAFF. THEY HAD A CONVERSATION. AND WHAT I'M WAITING FOR IS -- AND I GAVE UNTIL SEPTEMBER 6th. MAYBE I SHOULDN'T HAVE GIVEN THAT MUCH TIME. BUT I'D LIKE TO HAVE IT IN WRITING, SO I WANT AN ANSWER TO ALL THE QUESTIONS THAT I ASKED OF THE COMPANY IN MY MONDAY LETTER. AND I'M GOING TO WAIT UNTIL THEN AND READ ON PAPER THEIR JUSTIFICATION FOR THESE INCREASES, GIGANTIC INCREASES THAT THEY'VE HAD THAT I THINK ARE UNJUSTIFIED, AND AT THAT POINT, THEN WE'LL HAVE THE CONVERSATION THAT SHE WANTS TO HAVE. BUT I WANT MY LETTER ANSWERED.
LEE: A KEY PART OF HER THESIS AS TO WHY THESE PRICES HAD TO INCREASE ARE THE MIDDLE MEN IN THE SYSTEM. SENATOR, DO YOU THINK THAT YOU'RE ALSO ADDRESSING THAT ASPECT OF THE PRICE INCREASE PROBLEM, THAT THERE ARE OTHER PEOPLE INVOLVED, NOT JUST THE COMPANIES THAT ACTUALLY MAKE THE DRUGS --BUT THE COMPANIES THAT DISTRIBUTE THE DRUGS, THE COMPANIES THAT INSURE THE PATIENTS?
GRASSLEY: IF YOU'RE ASKING AM I LOOKING AT OTHER THINGS RIGHT NOW AS A RESULT OF MYLAN'S PRICE GOING UP, THE ANSWER IS NO. BUT WE DO NEED TO CONSIDER ALL THE QUESTIONS THAT YOU JUST RAISED IN THE WHOLE AREA OF COMPREHENSIVE REVIEW OF THE PRICING OF DRUGS AND GET EVERYTHING OUT. TRANSPARENCY AND THINGS OF THAT NATURE I THINK ARE VERY, VERY IMPORTANT. BUT IN THIS PARTICULAR INSTANCE, WE GOT ONE COMPANY WITH A MONOPLY ON THE PRODUCT GOING UP MORE THAN 400%. SOME FAMILIES IN IOWA ONE FAMILY WITH FOUR CHILDREN THAT HAVE THIS PROBLEM. IT COULD COST $2,000 A YEAR FOR THAT TREATMENT.
CARUSO-CABRERA: IT'S MICHELLE HERE. YOU'RE RIGHT TO BRING UP THIS ISSUE OF COMPETITION. WHEN YOU LOOK AT THE REVENUE THAT THEY'VE BEEN ABLE TO BRING IN, BACK IN 2013, IT WAS ONLY 824 MILLION. THIS YEAR, IT'S EXPECTED TO BE 1.3 BILLION. HOWEVER, ONCE THERE IS A GENERIC ON THE MARKET NEXT YEAR, THE REVENUE ON THE EPIPEN STARTS TO FALL DRAMATICALLY. AT LEAST THAT'S WHAT WALL STREET EXPECTS BECAUSE THERE'S GOING TO BE MORE COMPETITION. WHY IS THE FDA SO SLOW IN ALLOWING OTHER COMPETITORS INTO THE MARKET?
GRASSLEY: OKAY, WELL, YOU PROBABLY ARE AWARE OF THE FACT THAT TWO DAYS LATER, I DID WRITE A LETTER TO THE FDA. I HAD FOUR OTHER SENATORS SIGNING IT. WANTING TO FIND OUT SEVERAL THINGS. ONE, THERE WAS SOME COMPETITORS THAT DIDN'T GET APPROVED BY THE FDA. WE WANT TO KNOW WHY THEY WERE NOT APPROVED. WE WANT TO KNOW WHETHER THERE IS SOMETHING IN PROCESS TO APPROVE SOME COMPETITION FOR THE SAME PRODUCT BECAUSE COMPETITION WILL DRAW DOWN THE PRICE, AND WE WANT TO KNOW WHETHER THAT PROCESS CAN BE SPEEDED UP TO GET COMPETITION TO MARKET. BECAUSE I THINK ONE OF THE REASONS MYLAN HAD THE GUTS TO MOVE THIS PRICE UP SO RAPIDLY IS BECAUSE THEY DO HAVE A MONOPOLY, AND ABOUT 40% OF THEIR CLIENTELE IS MEDICAID, SO THEY CAN CHEAT THE TAXPAYERS AS MUCH AS THEY'RE CHEATING INDIVIDUAL FAMILIES, SO THEY'RE PUTTING OUT THIS $300 GIFT CERTIFICATE, OR WHATEVER YOU WANT TO CALL IT TO HELP FAMILIES, BUT ARE THEY PUTTING IT OUT TO THE FEDERAL GOVERNMENT SO WE CAN SAVE TAXPAYERS' MONEY THE SAME WAY THAT THEY WANT TO MAKE IT A LITTLE BIT CHEAPER FOR THE FAMILIES. IF THEY CAN PUT OUT A $300 GIFT CERTIFICATE, WHY CAN'T THEY PUT OUT -- JUST LOWER THE PRICE? BUT RIGHT NOW, THESE ARE ALL QUESTIONS. I'M WAITING FOR AN ANSWER TO MY LETTER.
SULLIVAN: CAN I JUMP IN? IT'S BRIAN SULLIVAN. WHEN I DID THE INTERVIEW I ASKED HER JUST THAT QUESTION. I SAID WHAT'S THIS REBATE? WHY NOT JUST CUT THE PRICE?
SULLIVAN: AND HER ANSWER -- AND I DON'T WANT TO SPEAK FOR HER. IT WAS A COUPLE HOURS AGO. IT SEEMED TO BE BASICALLY BECAUSE OF ALL THE PEOPLE IN THE MIDDLE, THAT IF SHE CUTS THE PRICE, THAT THEY MAY NOT AND THE CONSUMER WOULDN'T GET AS MUCH OF A BENEFIT FROM THE PRICE CUT AS THEY MIGHT FROM THIS REBATE. YOU CAN AGREE OR DISAGREE. THAT WAS HER RATIONALE.
GRASSLEY: OK WELL, THERE IS ONE NEED THAT I WOULD AGREE WHETHER MYLAN RAISES IT OR ANYBODY ELSE RAISES IT. MOST OFTEN, IT'S RAISED BY THE SMALL TOWN PHARMACIST THAT WE HAVE. BUT THE PHARMACY BENEFIT MANAGERS HAVE A GREAT DEAL OF SECRECY IN HOW THEY PRICE THINGS AND HOW THEY MAKE DEALS AND CONTRACTS WITH USERS. I THINK THERE OUGHT TO BE MORE TRANSPARENCY ON A BENEFIT MANAGERS AS WELL AS ASKING FOR TRANSPARENCY RIGHT NOW ON THE PART OF MYLAN.
MATHISEN: WHICH IS ONE OF THE THINGS MS. BRESCH SAID, SHE WANTED MORE TRANSPARENCY IN THE PROCESS THROUGHOUT.
MATHISEN: SHE BASICALLY AGREES WITH YOU ON THAT. INVARIABLY, SENATOR, WHEN WE TALK ABOUT DRUGS AND DRUG PRICING, THE ISSUE OF THE ABILITY OF GOVERNMENT PROGRAMS, WHETHER IT'S MEDICAID, WHICH YOU MENTIONED, MEDICARE, OR THE CHILDREN'S HEALTH INSURANCE PROGRAM, TO NEGOTIATE PRICES WITH PHARMACEUTICAL COMPANIES COMES UP. WOULD THAT HELP IN THIS CASE? WOULD IT HELP BROADLY? WHERE DO YOU STAND ON THAT IDEA?
GRASSLEY: WELL, I THINK IT'S ONE WAY TO LOOK AT A COMPANY THAT HAS MONOPOLY. THERE MIGHT BE SOME REASON FOR THE GOVERNMENT TO STEP IN. I'D RATHER HAVE THE MARKETPLACE WORK, BUT IF YOU ONLY GOT ONE PERSON PRODUCING IT, THEN THAT CREATES PROBLEMS THAT MAYBE THE GOVERNMENT OUGHT TO LOOK AT. BUT IF YOU LOOK AT THE WAY THAT YOU JUST SUGGESTED OR OTHER PEOPLE ARE SUGGESTING IT SHOULD BE DONE BY HAVING THE GOVERNMENT NEGOTIATE, THAT'S THE WAY THE V.A. DOES IT. YOU CAN DRIVE DOWN PRICES, BUT THE GOVERNMENT DOESN'T NEGOTIATE, GOVERNMENT DICTATES. WHEN GOVERNMENT DICTATES, IN THE CASE OF THE VETERANS ADMINISTRATION, THEY END UP WITH ABOUT A THIRD OF THE FORMULARY THAT YOU HAVE IN PART D MEDICARE, WHERE THE MARKETPLACE WORKS AND WHERE YOU HAVE A LOT OF COMPETITION, AND THE COMPETITION ITSELF HAS BROUGHT DOWN THE PRICE OF DRUGS TREMENDOUSLY.
LEE: SENATOR GRASSLEY, HOW FAR DO YOU GO WITH MYLAN? I ASK YOU THIS, BECAUSE EPIPEN HAS REALLY TOUCHED A NERVE IN THIS COUNTRY BECAUSE IT'S OFTEN USED BY CHILDREN, FOUND IN CLASSROOMS, ETC. BUT MYLAN ACTUALLY HAS A LIST OF OTHER DRUGS THAT HAVE GONE UP 400%, 500% IN THE FIRST SIX MONTHS OF THE YEAR, THIS ACCORDING TO WELLS FARGO. DO YOU GO DOWN THE LIST OF THEIR PRODUCT PORTFOLIOS AND SAY THIS ONE ALSO? ADD TO THE LIST THIS ONE. HOW ABOUT THIS DRUG FOR IRRITABLE BOWEL SYNDROME. HOW FAR DO YOU GO WITH THIS COMPANY OR EVEN OTHERS THAT HAVE RAISED THEIR PRICES IN COMMENSURATE PERCENTAGES?
GRASSLEY: WELL, I'VE BEEN INVOLVED IN NEGOTIATIONS ON DRUGS THAT COST $90,000 A YEAR FOR SOME PEOPLE THAT HAVE HEPATITIS C AS AN EXAMPLE. WE FIND OUT THAT WHEN YOU BRING PUBLIC ATTENTION TO IT, AS WE BROUGHT PUBLIC ATTENTION TO MYLAN NOW AND HAVE A VERY BAD PUBLIC RELATIONS PROBLEM, AND THEY'RE IMMEDIATELY TRYING TO SOLVE IT BY GETTING THE CEO OUT THERE OR GETTING THESE GIFT CERTIFICATES OUT THERE TO QUIET PEOPLE DOWN, TRANSPARENCY BRINGS ACCOUNTABILITY. AND RIGHT NOW, I'M GOING TO TACKLE THIS ONE DRUG AT A TIME. BECAUSE I THINK THAT THE EXTENT TO WHICH WE CAN BRING GOVERNMENTAL PRESSURE INDIRECTLY THROUGH THE BAD PUBLIC RELATIONS, SOME OF THIS PRICING, AND THE DECISIONS THAT GO INTO THE PRICING, LIKE IN HEPATITIS C INSTANCE I TALKED ABOUT, I THINK THAT THAT'S A BETTER APPROACH. SO MANY PEOPLE IN CONGRESS WOULD SAY GOVERNMENT REGULATION. I DON'T LIKE VERY MUCH GOVERNMENT REGULATION.
LEE: IT SOUNDS LIKE YOU'RE SAYING THAT YOU'RE SATISFIED, THOUGH, WITH JAWBONING, SO THAT THERE ARE INDIVIDUAL CASES SUCH AS GILEAD AND THE HEP C TREATMENT. SUCH AS TOURING. SUCH AS THIS ONE WHERE A BRIGHT LIGHT IS SHINED BY CONGRESS AND OTHERS IN THE MEDIA, ETC., ETC., AND THEY ARE JAWBONED INTO LOWERING THEIR PRICES. THEN IT SEEMS LIKE THE SPOTLIGHT GOES AWAY. IS THAT WHAT'S GOING TO HAPPEN THIS TIME?
GRASSLEY: NO, I'M TALKING ABOUT ONE INSTANCE THAT CAME UP HERE THAT'S UNJUSTIFIABLE, THAT WE'RE LOOKING INTO, AND WE HOPE WE CAN ACCOMPLISH SOME GOOD BY GETTING REASONABLE PRICING. BUT YOU'RE BRINGING UP A VERY LEGITIMATE QUESTION THAT'S MUCH BROADER, AND I THINK THAT HAS TO BE BROUGHT UP IN THE CONTEXT OF GENERAL HEALTH CARE REFORM. WHETHER IT'S JUST DEALING WITH PHARMACEUTICALS OR THE WHOLE HEALTH CARE DELIVERY SYSTEM.
CARUSO-CABRERA: ANOTHER BROADER QUESTION THAT'S COME UP AS A RESULT OF THIS, SENATOR, IS THAT THE UNITED STATES IS THE ONLY COUNTRY THAT REALLY PAYS FOR R&D. THERE ARE PRICE CONTROLS ON DRUGS IN ADVANCED ECONOMIES AROUND THE WORLD. AND WHY ISN'T CONGRESS MORE AGGRESSIVE IN TRYING TO USE THE WTO. WE REALIZE PRICE CONTROLS ARE BAD, RIGHT? WE LEARNED THAT IN THE '70s IN THE UNITED STATES. WE'RE LEARNING EVERY DAY WITH VENEZUELA. THEY'RE SUFFERING MASSIVE SHORTAGES. THE REST OF THE WORLD SEEMS TO THINK PRICE CONTROLS ON DRUGS ARE OKAY. THE RISK IS THAT WE END UP IMPOSING PRICE CONTROLS, AND WHAT'S GOING TO HAPPEN TO INNOVATION IN THE PHARMACEUTICAL INDUSTRY? IT WILL DROP DRAMATICALLY. WHY DON'T WE FORCE OTHER COUNTRIES TO SAY HEY, WHY IS IT GERMANY THAT YOU THINK YOU DESERVE CHEAP DRUGS? YOUR PEOPLE LIVE VERY WELL ON VERY HIGH INCOMES.
GRASSLEY: YOU'VE KIND OF PUT A SUMMARY ON A LOT OF SPEECHES I'VE GIVEN ON THE FLOOR OF THE UNITED STATES SENATE. IT DOESN'T COME IN CONJUNCTION ALL WITH THE TOOL YOU SUGGESTED WE USE, THE WTO. IT COMES WITH THE ISSUE IN CONGRESS OF WHETHER OR NOT THERE OUGHT TO BE ONE CONSUMER PRODUCT IN THE UNITED STATES ABOVE ALL CONSUMER PRODUCTS THAT YOU CAN BUY FROM OVERSEAS, WHY DO WE HAVE A PROHIBITION ON IMPORTING OF DRUGS? I HAVE WORKED WITH SENATOR McCAIN AND OTHER SENATORS ON THIS ISSUE. I VOTED FOR DOING AWAY WITH THAT PROHIBITION. IF WE DO AWAY WITH IT, WE WILL HAVE MORE PROHICOMPETITION FROM AROUND THE WORLD TO DRIVE DOWN OUR PHARMACEUTICAL COMPANIES AND OUR PHARMACEUTICAL COMPANIES THAT GO TO GERMANY. THAT'S THE COUNTRY YOU NAMED. AND THEY GET A BIG VOLUME AT A VERY LOW PROFIT. AND GERMANS AREN'T PAYING FOR THE RESEARCH WE DO IN THIS COUNTRY LET THE GERMANS PAY FOR SOME OF OUR RESEARCH VIA OUR COMPANIES GETTING MORE MONEY OUT OF THE GERMANS.
SULLIVAN: WE'D LOVE TO TALK ABOUT LOW DRUG PRICES IN CANADA, BUT THERE'S REALLY NOT ANY CANADIAN DRUG COMPANIES THAT ARE CREATING BLOCKBUSTER DRUGS. GREAT COUNTRY, THEY'RE JUST NOT DOING IT. SENATOR I HAVE TO LEAVE IT WITH THIS THOUGH MY GUESS IS YOU MAY WANT A HEARING OR INQUIRY WITH MYLAN AND/OR OTHER PHARMACEUTICAL CEOs. WILL YOU ALSO CALL IN THE DRUG DISTRIBUTION AND PBM COMPANIES INTO A HEARING?
GRASSLEY: WE NEED TO LOOK MORE AT PBMs. I'M NOT GOING TO SAY I'M HAVING ANY HEARING AT ALL. I'M GOING TO WAIT UNTIL I GET THE ANSWER FROM MYLAN. AT THAT POINT, IF AN ANSWER ISN'T LEGITIMATE, AND THE PRICES DON'T GO DOWN, THEN WE'LL TALK ABOUT HAVING A HEARING. WE COULD GET INTO THAT AS WELL AT THE SAME TIME, BUT I'M GOING TO MAKE THAT DECISION AFTER SEPTEMBER 6th.
LEE: SENATOR GRASSLEY, THANKS SO MUCH FOR JOINING US HERE ON "POWER LUNCH." WE APPRECIATE YOUR TIME.
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