- The Washington Times - Friday, July 24, 2020

President Trump signed a batch of executive orders Friday designed to slash drug prices in an election year, including a long-awaited push to align the price of Medicare drugs with what other developed nations pay.

He said it is unfair that Americans bear the cost of Big Pharma’s research-and-development costs through high prices while “socialist” countries enjoy lower prices, often due to government-mandated caps.

“They’re all allies, right? I call them so-called allies,” Mr. Trump said in a White House event.

“We are bearing the entire cost of all of this. They are bearing none,” he said. “I’ve been waiting for this day a long time.”

But Mr. Trump said threw in a curveball — the “favored-nations” order will only take effect Aug. 24 unless pharmaceutical companies come forward with a better fix. The president is set to meet with executives next week.



Another executive order would force middlemen to pass certain rebates to consumers, while a third would require community health centers to pass along discounts for insulin to diabetics and for EpiPens for allergy sufferers.

A fourth would allow for the importation of drugs from Canada and other countries if the price in the U.S. is “incredibly lower.”

“I see it all the time. They go to Canada to buy drugs and then they come back,” Mr. Trump said.

Health Secretary Alex Azar said the framework will have three streams — states that want to launch importation programs, individuals who want to seek drugs abroad and a special program for importing insulin.

The president, who is set to face former Vice President Joseph R. Biden in November, said the previous administration talked about importation but didn’t proceed.

“They never got it done, they were unable to get it done,” Mr. Trump said.

Drug prices are a key issue for voters — especially older Americans, who Mr. Trump sees as critical to his reelection chances.

“I’m looking for help for our great seniors,” Mr. Trump said.

Mr. Trump was joined by Florida Gov. Ron DeSantis, a key ally whose swing state is home to many seniors and is grappling with a surge in coronavirus infections and hospitalizations. Mr. DeSantis swiftly moved to set up a drug-importation program upon taking office in 2019.

It’s unclear how the orders will play out in the coming months — some of Mr. Trump’s other plans have run into opposition from conservative allies or been blocked in the courts.

“We are immensely disappointed that the administration has decided to tout price controls as an answer to America’s rising prescription drug prices,” said Adam Brandon, president of the conservative group FreedomWorks. “Tying prices in the United States to those of nations which have implemented socialist price restrictions will only ensure that America inherits the wait times and shortages seen in those countries.”

The pharmaceutical lobby also expressed its displeasure.

“In his 2020 State of the Union Address, President Trump declared that ‘we will never let socialism destroy American health care,” said Stephen J. Ubl, president and CEO of the Pharmaceutical Research and Manufacturers of America. “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.”

But the orders reflected Mr. Trump’s desire to do something about drug prices in the face of congressional dithering.

Members of both parties have sensed an urgency to drive down costs amid reports of people rationing insulin and other life-saving medicines, though they’ve struggled to find common ground.

Mr. Trump has endorsed a bipartisan Senate bill by Finance Committee Chairman Charles E. Grassley, Iowa Republican, and Sen. Ron Wyden, Oregon Democrat, that would cap what seniors pay out-of-pocket. The bill also would force drugmakers to reimburse Medicare if their prices rise much faster than inflation.

The bill hasn’t gotten a floor vote — it’s splitting the Senate GOP conference — and the coronavirus pandemic derailed momentum for things like drug pricing and sunrise-billing legislation on Capitol Hill.

House Democrats went their own way, passing a partisan bill that would require the federal government to negotiate down maximum prices for insulin and dozens of single-source, brand-name drugs that are among the priciest covered by Medicare. The negotiated price cannot exceed 120% of the average price in Australia, Canada, France, Germany, Japan, and the United Kingdom.

Mr. Trump’s favored-nations plan is more limited in that it only applies to doctor-administered drugs under Medicare Part B.

The administration argues that prices under this section are fixed, anyway, so the U.S. should push for a better bargain.

“In the Part B program, it’s important to understand that the government is just a price taker,” said Seema Verma, who runs federal insurance programs for the administration. “Pharma manufacturers can charge whatever they want and the taxpayers have to bear the bill, and those costs are also borne by American seniors as well in the Medicare program.”

Senior Democrats derided the orders, saying they’d have no immediate impact — the rulemaking process can take months— or amount to warmed-over ideas that were rejected or withdrawn earlier in Mr. Trump’s term.

For instance, budget scorekeepers concluded a prior edition of the middleman-rebate plan for Medicare beneficiaries would result in higher premiums.

“The last version of the Trump Administration’s rebate proposal would put Medicare beneficiaries at risk of higher premiums and total out-of-pocket costs and puts the American taxpayer on the hook for hundreds of billions of dollars,” House Speaker Nancy Pelosi, California Democrat, said. “Thanks to President Trump, the pharmaceutical industry could see even bigger profits and even less restraint on what they charge seniors.”

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2020 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.

 

Click to Read More and View Comments

Click to Hide