government pricing pharma
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Trump s Plan for Drug Pricing Executive Order Is a Big Pharma Wish List
(Photo: TBIT; Edited: LW / TO)
Raise your hand if you believed Donald Trump’s repeated promises to take on Big Pharma. What about the presidential boast that drug prices for the American people “will come way down?”
Sadly, skepticism about the true impact of Trump’s populist posturing on drug pricing has proven to be well justified. As a worried nation focuses on the looming danger of the Senate vote to repeal the Affordable Care Act, the pharmaceutical industry has joined hands with the president who once said its corporate members are “getting away with murder.”
This week, the New York Times obtained a draft of a planned President Trump executive order on drug pricing. As Patients for Affordable Drugs founder and cancer patient David Mitchell told the Times, the text indicates that “Pharma has captured the process.”
The order, which appears likely to be rolled out after the dust settles on the Affordable Care Act repeal effort, was reportedly written largely by Trump budget staffer Joe Grogan, who was hired by the administration fresh from his role as a drug industry lobbyist. But Grogan is certainly not the only one carrying Big Pharma’s interests into the Trump administration. Secretary of Health and Human Services Tom Price has been a heavy investor in the pharma industry, and FDA Commissioner Scott Gottlieb spent years collecting hundreds of thousands of dollars in consulting fees from pharma companies. Predictably, Trump’s team has written an executive order that reads like a Big Pharma wish list of eased regulation and extended monopolies.
Conspicuously absent from the proposed Trump order are the most logical and popular reform proposals, including allowing the Medicare program to use its massive purchasing power to negotiate lower drug prices. Trump has explicitly endorsed Medicare negotiation in the recent past, and the shackles on Medicare are a key contributor to patients in the US paying the highest medicines prices in the world. But there is no mention of Medicare drug price negotiation in the draft order.
Also missing is any embrace of the movement to allow US patients to import their medicines from Canada or other nations with far cheaper prices. Nor are there provisions to take advantage of the government’s extensive legal rights to allow generic drug production and break the monopolies of over-priced patented drugs, especially the many critical drugs that were developed thanks to taxpayer funding. A majority of states are considering legislation to require increased drug price transparency and justification for large price increases, and some have passed such legislation — but the Trump administration’s draft order does not enhance transparency.
Instead, in an audacious example of blaming the victim, the draft order takes aim not at the industry whose profits rival those of banks and oil companies, but at low-income patients, both in the US and in developing countries. The proposal calls for restrictions on the 340B Drug Pricing Program, in which pharma corporations that benefit from the lucrative Medicaid market for their drugs are required in return to give some discounts to hospitals and clinics that serve low-income patients. And the order pushes for ramped-up trade pressure on developing countries that try to reduce the duration of drug monopolies that make medicines unaffordable for their citizens.
Not only are such measures mean-spirited, they would also be completely ineffective at reducing medicine prices for US patients. Rolling back limited drug price discounts for the poor would only increase revenue for pharmaceutical corporations that have a proven track record of directing their dollars into marketing, lobbying and breathtakingly high CEO pay, not lowered prices.
The argument that lower drug prices outside the US are hurting medicine research has been thoroughly debunked: High US prices have been proven to be fueling corporate profits, not industry research. Even if the Trump administration harbors legitimate concern that other countries are getting a free ride on US research investments, extended monopolies are not the answer. Knowledge Ecology International’s Jamie Love and others have proposed several ways the Trump administration could make increased medicine research contributions part of its ongoing trade negotiations with other nationsg — a far more effective way to spur increased research than hiking drug prices overseas.
As Public Citizen’s Peter Maybarduk says of the executive order, “The way to reduce medicine prices in the United States is to reduce them in the United States. Making medications more costly for the world’s poor won’t make them more affordable in the US, and won’t help Americans who are forced to choose between paying for their health care and paying the rent.”
But making medications even more expensive than they already are is precisely what Big Pharma wants. And President Trump appears determined to give it to them, all promises to the contrary be damned.