President Trump’s blueprint to address prescription drug prices reveals his desire to ensure big Pharma thrives. It represents another broken campaign promise. Indeed, it was such a relief to Pharma investors that stock prices for pharmaceutical companies and pharmacy benefit managers rose following Trump’s release of his plan. What’s wrong with Trump’s plan and why are the drug companies and their investors so happy?
- The plan leaves power in the hands of pharmaceutical companies to raise prices enormously in the US and encourages them to raise prices around the world. The President appears fine with the prices Americans pay for drugs. He just wants pharmaceutical companies to charge other countries more for them.
- The plan does little or nothing to help people with Medicare or complex conditions needing astronomically priced drugs. It does not support Medicare drug price negotiation, let alone drug price negotiation for all Americans, which is what is needed. It suggests that there is some way for Part D plans to better negotiate without specifying what that way might be.
- The plan would allow some Medicaid agencies not to cover certain critical prescription drugs. This could mean that some people with Medicaid may be forced to go without needed medicines.
- The plan does nothing to address the pharmaceutical industry practice of keeping their drugs on patent and keeping generic substitutes off the market through a variety of tactics.
- The plan does not encourage drug innovation to address major public health issues.
Just to say it, President Trump does not single out the pharmaceutical companies for price gouging but rather suggests that other parties are to blame, particularly the Pharmacy Benefit Managers and lobbyists. Since pharmaceutical companies set the prices and quash generic competition any way they can, Trump gives them a free pass. Or, perhaps, a multimillion dollar pass, given that Novartis paid $1.2 million to Trump’s lawyer and lord knows how much other pharmaceutical company money traded hands with Trump’s team.
Trump’s plan appears to throw consumers a bone or two, but appearances can be deceiving.
- For people with Medicare Part D, HHS could lower out-of-pocket drug costs. But, would that simply lead Part D plans to increase premiums?
- Trump seems to want to limit the power of Pharmacy Benefit Managers (PBMs) to benefit from drugmaker fees and rebates at the expense of people buying the drugs. But, it is not clear what that will mean for consumers.
- HHS might address the ability of drugmakers to give rebates off the list price of drugs. Again, that is not likely to deliver a net benefit to consumers.
- HHS could limit increases in prices drugmakers charge under Medicare Part B.
Meanwhile, the Hill reports that House Republicans might actually pass a bill that addresses high prescription drug prices. They are working on a “compromise” to the CREATES Act, which might help speed more generics to market. Some Republicans say that they are concerned that the bill would lead to “frivolous lawsuits” against drugmakers. Of course, the drugmakers are using every arrow in their quiver to keep the CREATES Act from being enacted in any form.
Here’s more from Just Care:
- How the US should negotiate drug prices
- With drug prices soaring, millions buy drugs abroad
- If we can import food safely, why not medicines?
- Six tips for keeping your drug costs down if you have Medicare
- New study finds Medicare Advantage plan enrollees end up in lower quality nursing homes than people in traditional Medicare