On drug costs, modest steps follow Trump’s big promises
WASHINGTON (AP) — President Donald Trump makes big promises to reduce prescription drug costs, but his administration is gravitating to relatively modest steps such as letting Medicare patients share in manufacturer rebates.
Those ideas would represent tangible change and they have a realistic chance of being enacted. But it’s not like calling for Medicare to negotiate drug prices.
Skeptics say the overall approach is underwhelming, and Trump risks being seen as an ally of the powerful pharmaceutical industry, not its disrupter.
The White House Council of Economic Advisers has released a 30-page strategy for reducing drug costs, and it calls current policies “neither wise nor just.” The plan, outlined before Trump releases his new budget proposal Monday, focuses mainly on Medicare and Medicaid changes, along with ideas for speeding drug approvals and fostering competition.
“Despite promises to drastically lower prices the mix of proposed changes does not appear likely to do so, even though there are some constructive proposals,” said John Rother, CEO of the National Coalition on Health Care, an advocacy group whose members include consumer organizations, medical societies, hospitals and insurers.
Polls show the high cost of drugs is a top concern of Americans, regardless of political leanings. In his State of the Union speech, Trump seemed to foreshadow major change, saying “fixing the injustice of high drug prices” is a top priority this year.
“And prices will come down substantially,” Trump added. “Watch.”
As a candidate, Trump advocated Medicare negotiations and he called for allowing consumers to import lower-priced medicines from abroad.
But the White House strategy paper veers away from such dramatic steps.
His new health secretary, Alex Azar, was a top executive at pharmaceutical giant Eli Lilly.
Medicare negotiations and drug importation are unacceptable to the drug industry, which has spent tens of millions of dollars since Trump’s inauguration to influence the Washington conversation around drug prices, including a high-profile TV advertising campaign portraying its scientists as medical trailblazers.
The White House strategy largely sidesteps the question of whether drugmakers set their prices too high to start with. Rather, it recommends changes to policies that the administration believes unwittingly lead to higher prices, and suggests ways to speed drugs to market and increase competition.
It takes aim at foreign governments that dictate what drug companies can charge their own citizens. Trump often has noted that the same medications Americans struggle to pay for can be bought for much less abroad. The White House report examined 35 economically advanced countries, and found that U.S. consumers and taxpayers pay for more than 70 percent of drug company profits that fund innovation.
The industry defends its pricing by saying companies have to recoup considerable research and drug development costs within the limited window when brand drugs are protected from generic competition. But examples of profit-seeking abound.