Trump’s prescription drug price claim off the mark
President Donald Trump repeated a misleading claim about the cost of prescription drugs under his watch.
“Drug prices are coming down, first time in 51 years because of my administration, but we can get them down way lower working with the Democrats,” Trump said in a May 22 address in the Rose Garden. Trump called a news conference to push back against House Speaker Nancy Pelosi’s comments accusing Trump of a cover-up related to congressional probes of his administration.
We fact-checked a similar statement in April by Mick Mulvaney, the acting White House chief of staff, rating it Mostly False. Nothing has changed our conclusion since then.
Evidence is lacking
After Trump’s Rose Garden speech, we sent the White House press office emails asking if it had any evidence beyond what we reported in our earlier fact-check; we did not get a response.
In April, the White House directed us to a 2018 report published by its Council of Economic Advisers pointing to efforts by the Trump administration to bring down prescription costs. Also, the White House sent us data suggesting the consumer price index for prescription drugs declined in January 2019 compared with January 2018. The White House sent data stating the cost in January was 11% below where trends said it should have been.
However, the most recent data from the federal government shows a slight uptick: prescription drug prices increased by 0.3% in April 2019 compared to April 2018.
It is possible to define time periods in such a way to make the statement — or something close to it — accurate with respect to the prescription drug CPI, said Matthew Fiedler, a health economist at the Brookings Institution. But the CPI is a highly imperfect measure for tracking prescription drug price trends, because it measures list prices rather than net prices.
“For most purposes, net prices are the most economically relevant quantity,” he said. “And it’s unclear how much credit the administration really deserves for these trends.”
The CPI data doesn’t account for whether manufacturers lowering their list prices have also changed the size of the rebates they provide.
Also, this data also doesn’t cover all prescriptions — it only covers drugs sold through retail, or about threefourths of all prescriptions, and excludes many high-priced specialty meds sold only via mail order.
The administration’s proposal to have Medicare pay for physician-administered drugs based on average prices internationally could substantially reduce prices for these drugs, if implemented, Fiedler said. However, when — and even whether — it will ultimately be implemented remains an open question.
It’s also worth noting that both the Congressional Budget Office and the Centers for Medicare and Medicaid Services Office of the Actuary have concluded that one of the administration’s other marquee proposals — a requirement that plans pass rebates through to patients in Medicare Part D — would actually increase drug prices on net, Fiedler said. This proposal looks like it’s on track for implementation in 2020 or 2021.
Other measures of drug costs do not support what Trump said.
Data from the Kaiser Family Foundation shows total spending on prescription drug prices has climbed during the past several years. (Kaiser Health News, a PolitiFact partner, is an editorially independent program of the foundation.) In 2018, total spending continued to grow, just at a slower pace. That’s a positive trend, experts noted, but it isn’t the same thing as spending going down.
Benedic Ippolito, an economist at the conservative American Enterprise Institute, told PolitiFact that it is a bit challenging to conclusively connect the Trump administration’s actions to substantial reductions in drug prices — at least not yet, as many of their more consequential proposed reforms have not been implemented.
Some manufacturers are reporting that their average net prices have declined in recent years. For example, Janssen, the pharmaceutical companies of Johnson & Johnson, reported net prices dropped 6.8% in 2018.
However, many drug prices have climbed.
This year, the list price of more than 3,000 drugs went up, while the price of only 117 went down, according to data compiled by Rx Savings Solutions. Last year, an analysis by the Associated Press revealed that, from January to July, 4,412 branded drug prices went up, while 46 were cut.
In April, a White House spokesman pointed to efforts to bring more generic drugs to market. But experts said it takes time for these products to reach the marketplace, create competition and demonstrate a measurable effect on prices.
In May, Trump urged his Department of Health and Human Services to help Florida Gov. Ron DeSantis on his priority to adopt a Canadian drug importation program with the goal of bringing down prices for consumers. No HHS secretary has ever issued such an approval. It’s also unclear whether such an importation program would bring down prices, since drug manufacturers could cut down on what they sell to Canadian entities supplying drugs to American wholesalers.
Our ruling
Trump said, “Drug prices are coming down, first time in 51 years because of my administration.”
There is data that could conceivably support the argument that the list prices for some prescription drugs dipped in 2018. But that data doesn’t include many high-priced specialty drugs that drive costs up or the fact that some individual drug prices have increased.
Nationally, spending on drugs has continued to climb, even if that growth has slowed. There is also no evidence to support the argument that Trump himself is responsible for changes in drug pricing.
This claim has an element of truth, but it ignores key facts and context that would give a very different impression. We rate this claim Mostly False.