President Trump Promises to Lower Prescription Drug Prices

  • President Trump Promises to Lower Prescription Drug Prices

President Trump Promises to Lower Prescription Drug Prices

President Donald Trump outlined plans to reduce soaring United States prescription drug prices, among the highest in the world, but opposition Democrats accused him of falling short of his election campaign promises.

The proposals also include banning the pharmacist "gag rule", which Trump said prevents druggists from telling customers about lower-cost options so they can save money, and speeding up the approval process for over-the-counter medications so patients can buy more drugs without prescriptions.

President Trump said he wants to eliminate "the middlemen" in that system.

In a Rose Garden speech, Trump said his administration "is launching the most sweeping action in history to lower the price of prescription drugs for the American people".

Second, is to unrig the system to ensure Americans pay the lowest possible price at the pharmacy.

But Big Pharma Should Still Be On Notice: "The industry is among the most profitable of any industry in the US and as such probably has room to give", Wells Fargo analyst David Maris told Bloomberg.

But some industry voices also challenged some of Mr. Trump's proposals Friday, signaling that their lobbying campaign will become more public in the coming months as the blueprint is debated.

Critics said the policies pointed to the influence the pharmaceutical industry wields with the administration.

Senator Chuck Schumer, Democrat from NY, said the president's blueprint offered "little more than window dressing". Current U.S. law prohibits Medicare officials from interfering in the negotiations between drugmakers and the insurance companies that administer Medicare's prescription drug plans.

On Wall Street, shares of major pharmaceutical companies appeared unfazed by the announcement, with Merck closing up 2.81 percent, Pfizer gaining 1.31 percent, Bristol Myers up 1.39 percent and Eli Lilly - where Azar was a top executive - ahead 1.97 percent.

"The plan was a lot less aggressive than investors expected", wrote Alex Arfaei, analyst at BMO Capital Markets.

In a major departure from his early and harsh criticism of pharmaceutical companies, Trump lashed into the entire supply chain that lies between patients and drugmakers Friday, including the little-known industry that negotiates drug prices and health insurers.

Speaking in Washington on Friday, he said he had directed his top trade negotiator to make the issue a priority in trade talks. Federal health plans would also test ways to pay for drugs based on their effectiveness. The plan mostly lists dozens of "potential" steps the administration may take, along with many others that were included in the president's budget proposal and will require congressional action.

Drugmakers argue that list prices do not reflect actual cost with discounts and rebates.

"When foreign governments extort unreasonably low prices from USA drugmakers, Americans have to pay more to subsidize the enormous cost of research and development".

He said one new proposal would allow senior citizens enrolled in Medicare who hit the catastrophic period to pay nothing out of pocket, "so really relieve a huge burden on our senior citizens".

"The notion that if other countries pay more for drugs that U.S. consumers will pay less, that's just not true", he said.

Trump's Plan Includes Plenty of Steps He Can Take Without Congress: "It's framed as a pro-competitive agenda, and touches on a range of government programs that the administration can change through regulation - so that the president can take unilateral action", Daniel N. Mendelson, the president of research consultancy Avalere Health, told The New York Times. Trump's drug pricing blueprint has so many different, technical aspects and will take long enough to implement that it could be hard for Republicans to sell this to voters as a big win, said Joseph Antos, a resident scholar at the American Enterprise Institute.