Pricing deal collapses over Big Pharma's refusal to issue $100 'cash cards' before the election — report
Late in August, as negotiations on a pricing deal with President Trump reached a boiling point, PhRMA president Stephen Ubl sent an email update to the 34 biopharma chiefs that sit on his board. He wrote that if the industry did not agree to pay for a $100 “cash card” sent to seniors before November, White House chief of staff Mark Meadows was going to tell the news media Big Pharma was refusing to “share the savings” with the elderly — and that all of the blame for failed drug pricing negotiations would lie squarely on the industry.
Drugmakers were on the brink of a deal. Typically unpalatable items like Medicare co-payments and $150 billion in out-of-pocket consumer costs were reportedly addressed. Yet it was the cash card demand by Meadows — Trump’s fourth chief-of-staff — that doomed the deal on a September 2 phone call between Ubl and the PhRMA board. These details were reported by the New York Times late on Friday, just as the nation was gripped with the news of Ruth Bader Ginsburg’s death.
Priscilla VanderVeer, the new vice president of public affairs at PhRMA, told the Times: “We could not agree to the administration’s plan to issue one-time savings cards right before a presidential election.”
The negotiations were taking place at a time Trump was threatening to, and eventually did, unveil a set of four executive orders aimed at reducing drug pricing. The most controversial order, which seeks to tie some drug prices at levels paid in other countries — and of which the legality is sure to be challenged, was issued after negotiations with PhRMA collapsed.
“President Trump signed four executive orders earlier this summer. However, he did not release the final executive order on ‘most-favored nation’ drug pricing, giving drug companies a month to come up with a counterproposal. Negotiations did not produce an acceptable alternative, so the president is moving forward,” said Judd Deere, a Trump spokesperson.
Citing four sources familiar with the matter, the Times reports the companies were willing, though reluctant, to spend the money on co-pay assistance. But there was a “broad consensus” on PhRMA’s board that it was out of line to issue $100 cash cards so close to the election.
The PhRMA board consists of 34 members, currently chaired by BMS’ Giovanni Caforio.