President Trump Addresses Need for More Competition, Lower Drug Costs
- Author: Zachary Reyes May 12, 2018,
May 12, 2018, 9:55
The move includes an FDA evaluation of whether drug manufacturers should be required to list prices in their advertising, as well as longer-term efforts to change the imbalance between what U.S. consumers pay for drugs developed in the United States versus what foreigners pay in their own countries, where drug prices are often substantially lower.
Trump's speech singled out foreign governments that "extort unreasonably low prices from USA drugmakers" using price controls and said us trade representatives would prioritize the issue in trade deals.
Some of the actions the department plans are expected to have near-immediate force, while others will take more work. But as president he has shied away from major reforms and staffed his administration with appointees who have deep ties to the industry.
The plan, however, is expected to mostly spare the pharmaceutical industry he previously accused of "getting away with murder".
The plan also will target Medicare Part B by limiting price increases that exceed the inflation rate within the program and restricting incentives for providers to prescribe high-cost drugs. "It is a comprehensive process...and it will take time to reorder an entire complex multibillion dollar system of our economy", Azar said. The U.S.is the only country, other than New Zealand, that allows drug companies to advertise directly to consumers. "In some cases, medicine that costs a few dollars in a foreign country costs hundreds of dollars in America, for the same pill with the same ingredients in the same package made in the same plant, and that is unacceptable", Trump said.
Experts who study drug pricing are encouraged that the discussion has moved on from outrage to more sophisticated proposals.
According to senior administration officials, Trump plans to talk about how to increase competition, get more negotiating power, and find ways to lower pharmaceutical list prices as well as the out-of-pocket costs patients are facing.
Senator Ron Wyden, also a Democrat, said the proposals "amount to asking drug companies nicely to lower their prices with zero accountability".
Among the initiatives is a regulatory push to ditch so-called "pharmacy gag clauses", terms in some contracts between pharmacies and insurers which prohibit pharmacists from tipping off customers when they're overpaying through health plans.
"There is very little new in the administration's plan, and little if anything that will make a difference in the near future, as the president has promised", Rachel Sachs, an associate professor of law at Washington University School of Law, said in an email.
The Medicare Rights Center, a nonprofit organization that advocates for affordable healthcare access for seniors, said earlier this year that it supports giving rebates to people on Medicare Part D who are experiencing higher drug costs. Medicare Part D drug spending grew almost 45% between 2013 and 2016, and more beneficiaries are reaching catastrophic coverage of at least $5,000 out-of-pocket costs-up 50% from 2013 to 2016, according to a new study from Avalere.
Trump's drug pricing blueprint has so many different, technical aspects and will take long enough to implement that it could be hard for Republicans to sell this to voters as a big win, said Joseph Antos, a resident scholar at the American Enterprise Institute.
Separately, the White House is requesting feedback in several areas, including creating more prescription drug plan incentives for drugmakers that don't raise their prices. Chuck Schumer of NY, the Democratic leader, said after the speech.
Trump decried the participation of what he referred to as "middlemen", meaning primarily Pharmacy Benefit Managers - intermediaries between manufacturers and doctors and pharmacies. "Why? Because of the drug companies". Azar and Trump didn't mention that specific program Friday, but Cassidy said it's another example of discounts that don't end up saving patients money.
And Vt. Rep. Peter Welch said, "He swung and he missed". But the president has offered nothing but "radio silence" since then, Cummings said Thursday. Medicare will continue to be prohibited from directly negotiating prices by law.
The idea is one of many old and new proposals outlined in a White House blueprint unveiled in a long-awaited speech by the president.
Trump and Azar framed the proposals as a way of improving the government's power over the industry while promoting competition.
"We look forward to working with the administration on solutions that help provide all patients access to prescription drugs with out-of-pocket costs they can afford", Jim Greenwood, CEO of biotech trade association BIO said in a statement. "It will be a handsome thing".