With only weeks left in his presidency, Trump makes a final, long-shot bid to remake US drug pricing
As the curtain closes on his administration, President Donald Trump is using his final weeks in office to push one of his longest-running campaign promises of lowering prescription drug prices.
Trump announced in a brief Friday news conference that he would be instituting the “most favored nations” rule tying prices in the US to those in other developed countries, as well as ending certain rebates paid to middlemen, also known as pharmacy benefit managers, in Medicare. The two rules were part of a series of four executive orders Trump unveiled in July aimed at tackling high prescription costs.
The rule will begin to take effect on Jan. 1, Trump said, and is slated to run for the next seven years. In the meantime, Trump said he would allow state governors to purchase drugs from Canada at lower prices, though he offered no details about how this would take place.
It’s not immediately clear how President-elect Joe Biden’s incoming administration would handle the rule. Biden has said previously that he would consider establishing an independent review board to assess the values of medicines, according to Politico. Lawsuits challenging the new rules are likely forthcoming, further complicating their implementation. Trump is also contesting the election results, though independent observers don’t give him any kind of a real chance at succeeding.
PhRMA, one of the industry’s top lobbyist groups, expressed its displeasure with the moves in a statement Friday afternoon. President Stephen Ubl said, in part:
It defies logic that the administration is blindly proceeding with a “most favored nation” policy that gives foreign governments the upper hand in deciding the value of medicines in the United States. History proves that when governments take unilateral action to set prices, it disrupts patient access to treatments, discourages investment in new medicines and threatens jobs and economic growth.
In its current form, the most favored nations rule would apply to 50 costly Medicare Part B medicines, which are administered in doctors’ offices, such as expensive cancer and rheumatoid arthritis therapies. The administration plans to phase in the lowest price in other countries and “blend” it with the average sales price, and then add a flat amount per dose for each applicable drug.
Pharma companies have staunchly opposed enacting the most favored nations clause, and it was a source of much contention when Trump initially unveiled the proposal four months ago. There were scant details at the time and PhRMA submitted a counterproposal in August that would have cut Part B prices by 10%, compared to the 30% the White House sought.
The White House released the full text of the executive order in September, directing HHS Secretary Alex Azar to establish the clause for both Medicare Part B and Part D, which covers prescription drugs. Ultimately, a pricing deal reportedly fell through between the government and the industry after White House Chief of Staff Mark Meadows asked the companies to send a $100 “cash card” to seniors before November and pin the blame for failed negotiations on pharma companies.
Trump also announced Friday that he would be ending the unapproved drugs initiative, in which the FDA removes unapproved drugs from the market for safety reasons, alleging they created several price gouging opportunities for companies looking to extend their market exclusivity windows. Since 2006, the FDA has reportedly shelved roughly 3,400 medicines and has only 11 left to review as part of the program, per Politico.