A new Arnold Ventures poll finds that nearly nine out of 10 voters believe the government should have the power to negotiate prescription drug prices. And, more than 75 percent say that it is very important for the government to reduce drug prices, including seven in 10 Trump supporters. Unfortunately, President Trump’s recent Executive Order on prescription drug prices and tariffs are likely to raise drug prices for Americans.
More specifically, the vast majority of Americans support capping drug price increases to the rate of inflation and Medicare negotiating drug prices for all drugs. Indeed, 86 percent say that they do not want people with Medicare to pay more for their drugs than people in other wealthy nations. But, Trump’s executive order undermines Medicare’s limited efforts to negotiate drug prices, much less expand Medicare’s authority to negotiate drug prices.
Bottom line: Your prescription drug costs are probably not coming down any time soon. President Trump’s tariffs on China could lead to higher drug costs for all Americans, as pharmaceutical manufacturers import ingredients from China. Meanwhile, Trump’s new Executive Order on prescription drug prices appears to favor the pharmaceutical industry’s interests, allowing drug companies to continue to set prices sky high and calling for changes to the Inflation Reduction Act that would drive up drug prices for people with Medicare.
Here are some of the key provisions of the Executive Order.
On a positive note, with caveats:
- It aims to reduce the cost of insulin and injectable epinephrine at community health centers for uninsured and some low-income individuals. It’s not clear by how much.
- It asks the FDA to make it easier for states to import drugs. But, it’s not at all clear that this provision will help Americans at the pharmacy. Today, the FDA has only granted permission to Florida to import drugs from Canada, and Florida appears not to have begun importing drugs. Moreover, Florida’s program is not designed to help its residents. It would only help lower the state’s costs a small amount for Medicaid recipients and for the state’s health and corrections departments.
- It calls for more generics and biosimilars–lower-cost alternatives to brand name drugs. But, the Trump administration has cut FDA staffing drastically. It eliminated the office that was tasked with speeding up generic drug approvals, slowing down drug approvals. Moreover, the administration has also cut NIH funding, which supports virtually all new drug development. So, while the president’s goal is laudable, it does not seem doable.
On a negative note:
- It is projected to drive up Medicare drug costs by $6 billion and force people with Medicare to pay $1.5 billion more for their drugs. How? The Executive Order buys into a pharmaceutical industry claim that the Inflation Reduction Act discriminates against pills. Discriminates? Well, let’s just say that the law gives license to pharmaceutical companies to charge high prices for injectable drugs for a longer period of time than for pills. The IRA permits drug price negotiation over pills on the market for nine years and injectable drugs on the market after 13 years. The Executive Order asks Congress to allow pharmaceutical companies the same 13 years of protection for pills as for injectables. If the Republican majority complies, more than half the drugs for which the Centers for Medicare and Medicaid Services is negotiating lower prices would no longer have lower negotiated prices.
- It calls for better transparency around the fees drug middlemen receive from pharmaceutical companies, which does not bring down drug prices for Americans.
The Trump administration also ended a Biden initiative that would have permitted people with Medicare to buy generic drugs for $2. And, it is denying Medicare coverage of anti-obesity drugs, as the Biden administration had proposed.
Here’s more from Just Care:
- Tariffs will likely drive drug prices higher and create drug shortages
- Prices for top Medicare drugs are up a lot
- Drug prices keep going up, some faster than inflation
- Biden administration penalizes drug companies hiking drug prices above the rate of inflation
- Don’t rely on Mark Cuban’s Cost Plus Drugs for the lowest prices
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