Drug-price deal quashed by White House gift cards idea

WASHINGTON >> After months of heated accusations and painstaking negotiations, the White House and the pharmaceutical industry neared agreement late last month on a plan to make good on President Donald Trump’s long-standing promise to lower drug prices.

The drug companies would spend $150 billion to address out-of-pocket consumer costs and would even pick up the bulk of the copayments that older Americans shoulder in Medicare’s prescription drug program. Then the agreement collapsed. The breaking point, according to four people familiar with the discussions: Mark Meadows, Trump’s chief of staff, insisted the drugmakers pay for $100 cash cards that would be mailed to seniors before November — “Trump Cards,” some in the industry called them.

Some of the drugmakers bridled at being party to what they feared would be seen as an 11thhour political boost for Trump, the people familiar with the matter said. White House officials insist they didn’t plan to emblazon the president’s name on the cards, which they envisioned sending to tens of millions of Americans to use for prescriptions. Trump, of course, has a long history of branding everything from skyscrapers to stimulus checks.

Regardless, one drug company executive said they worried about the optics of having the chief executives of the country’s leading pharmaceutical makers stand with the president in the Rose Garden as he hoisted an oversized card and gloated about helping a crucial bloc of voters.

“We could not agree to the administration’s plan to issue onetime savings cards right before a presidential election,” said Priscilla VanderVeer, vice president of public affairs at PhRMA, the industry’s largest trade group. “One-time savings cards will neither provide lasting help, nor advance the fundamental reforms necessary to help seniors better afford their medicines.”

For two powerful political forces that have often been at odds over the last four years, the prospect of a bargain offered coveted public relations victories. For years, the drugmakers have long been criticized for sky-high, opaque pricing for products that are often far cheaper in other countries. With a deal, the industry would get to project public spiritedness in the midst of a pandemic, while Trump would be able to deliver an immediate, long-promised benefit to voters over 65, with whom he is faring considerably worse in polls today than he did in 2016. Now neither side can claim bragging rights.

White House officials pointed a finger at PhRMA, maintaining that divisions in industry ranks over the financing of the agreement undermined negotiations. That’s precisely what Meadows told the trade group last month he would say if they did not reach a deal, according to a PhRMA email at the time.