Trump looks to hammer down drug prices with 4 executive orders
President Donald Trump signed 4 executive orders targeting the pharmaceutical industry Friday afternoon, four months before voters head to the polls.
The presidential directives are part of Trump’s long-standing goal to reduce prescription drug prices in the US. As the calendar turns toward November, the president has shifted to executive action over working with Congress to reach this objective.
Here are 3 of the 4 executive orders:
1. Drug rebates. https://t.co/mnjt89OANx
2. Insulin/Epi-Pen at small health centers. https://t.co/aSOFpHQoNa
3. Importation. https://t.co/rRhCRa48gx
4th on international price not released b/c it's contingent on pharma's alternative plan?
— Bob Herman (@bobjherman) July 24, 2020
Whether or not such action will result in any meaningful changes before the election remains to be seen, as the pharma industry continues to be a lobbying force on Capitol Hill. The executive orders are also likely to be challenged in court.
The most controversial order reportedly attempts to cap some prices Medicare pays to the price in foreign countries, which are usually significantly lower. The text wasn’t immediately available.
These “most-favored nations” clauses are akin to price controls in pharma circles, and Trump threatened drug companies by imposing this order within a month if the companies didn’t lower prices on their own. How Trump can enact the clause without Congress remains unclear.
One of pharma’s most influential lobbyist groups, PhRMA, unsurprisingly reacted negatively to the developments. Here’s PhRMA president Stephen Ubl:
In his 2020 State of the Union Address, President Trump declared that ‘we will never let socialism destroy American health care.’
Yet, in the middle of a global pandemic, when nearly 145,000 Americans have lost their lives and millions of others have suffered untold economic hardships, this administration has decided to pursue a radical and dangerous policy to set prices based on rates paid in countries that he has labeled as socialist, which will harm patients today and into the future.
The research-based biopharmaceutical industry has been working around the clock to develop therapeutics and vaccines to treat and prevent COVID-19. The administration’s proposal today is a reckless distraction that impedes our ability to respond to the current pandemic – and those we could face in the future. It jeopardizes American leadership that rewards risk-taking and innovation and threatens the hope of patients who need better treatments and cures.
The president’s attempt to open our country up to socialized health care sets America, our economic recovery and scientific progress back at a time when we need them most.
BIO’s chief Michelle McMurry-Heath also slammed the move, saying she was “dumbfounded that the Trump administration would seek to cripple the industry trying to end the COVID-19 pandemic.”
— Dr. Michelle McMurry-Heath (@DrMichelleBIO) July 24, 2020
During the press conference Trump said top pharma executives will meet with administration officials next week.
A second order is an extension of a plan introduced late last year that would allow states, drug wholesalers and pharmacies to re-import drugs from Canada at a lower cost. Pharma lobbyists claim that such plans would not be able to guarantee the safety of the US drug supply chain, a stance that has been met with skepticism, while Canada isn’t particularly interested in acting as a proxy between drug companies and states.
The other two orders target insulin pricing and the rebates drug wholesalers and pharmaceutical benefit managers receive when selling to insurers.
The lobbyist group PCMA has already come out in opposition to the latter measure, with president JC Scott saying in a statement, “This policy does nothing to address drug prices, it only serves to create uncertainty and raise premiums for seniors while imposing nearly $400 billion in additional taxpayer costs, all at a time when taxpayers are already footing additional costs to counter the pandemic and the national debt is at record levels.”
Drug prices have been a pet issue for Trump, and the president reportedly expressed his frustration with HHS secretary Alex Azar in January saying the Democratic Party will “kill us” on the issue. The COVID-19 pandemic has further complicated the issue, as Trump’s approval regarding how he’s handling the coronavirus is deep in the red, and the White House has been funneling cash into the industry to fuel the research and development of potential vaccines.