Trump's plan to bring down drug prices spares pharmaceutical industry

President Donald Trump speaks during a roundtable discussion on tax reform at the Cleveland Public Auditorium in Cleveland Ohio U.S

"The President's proposals... do nothing to hold wealthy drug companies accountable for their unconscionable price gouging", Pelosi said on Friday.

It said near-term actions would include giving commercial plans that administer Medicare Part D prescription drug benefits for seniors more power to negotiate prices with drugmakers.

"Getting rid of rebates and other price concessions would leave patients and payers, including Medicaid and Medicare, at the mercy of drug manufacturer pricing strategies", said the Pharmaceutical Care Management Association, a lobby for PBMs, in a statement following Trump's speech.

"It's so hard for seniors, especially to afford the prices we have to pay", she said.

Why is he tackling drug prices now?

The U.S. spent $1,162 per person on prescription drugs in 2015, according to the Organization for Economic Cooperation and Development.

- Speeding up the approval process for over-the-counter medications so people can buy more drugs without prescriptions. "Most of them would do very little for the 100 to 200 million Americans who are on private insurance". The industry has touted the slower growth as it weathers public backlash.

It would mostly spare the pharmaceutical industry he previously accused of "getting away with murder".

Trump also placed blame on foreign governments, saying they "extort unreasonably low prices" from USA drugmakers, forcing companies to charge more in this country.

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. Whoever those middlemen were - and a lot of people never even figured it out - they're rich.

Health and Human Services Secretary Alex Azar said during a White House briefing that numerous actions the government was considering would not require the US Congress, but could take place through executive action within months. "Simply put, the easiest way to lower costs would be for drug companies to lower their prices". "The system doesn't make that work", he said. Those include a proposal requiring drugmakers to disclose the cost of their medicines in their television advertisements.

The Community Oncology Alliance (COA) issued a statement saying that it "strongly supports" efforts to reduce drug prices.

The U.S. already has the highest medical prices in the world, research indicates. "None of them would affect the underlying drivers of the problem", said Rachel Sachs, an associate professor of law at Washington University School of Law. Would the drug's price similarly fade into the background?

"There are no major surprises, it spares the pharmaceutical industry of the reform that they most vehemently oppose", a pharmaceutical lobbyist told BioPharma Dive in an interview following the Trump speech.

"Our plan bans the pharmacist gag rule, which punishes pharmacists for telling patients how to save money".

"Insurance providers share the savings from negotiations with drug manufacturers by lowering premiums and copays for all consumers", AHIP said in a statement.

The Louisiana senator, echoing Azar's remarks, said he sees the entire pharmaceutical market as rife with "incredibly bad incentives" that create "incredibly high drug costs for too many Americans".

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". House Minority Leader Nancy Pelosi of California said Trump "pulled his punch".

Raising Drug Prices in Other Countries Won't Help Here: "There's not a sensible health economist alive, or any economist, that will tell you that higher prices overseas will lead to lower prices here", Andrea Harris, senior vice president of health care at Height Capital Markets in Washington, told Bloomberg.

CVS, which runs a large PBM, said policies that lowered drug prices would be aligned with its business model and are unlikely to have a negative impact on profitability. "Why? Because of the drug companies". The new proposal has plans to move some high priced drugs from Medicare Part B to Part D, which will allow PBMs to negotiate prices with the drug companies.

That idea has always been supported by Democrats but is a non-starter for drugmakers and most Republicans in Congress. But the president has offered nothing but "radio silence" since then, Cummings said Thursday.

And Azar said Friday that the administration is looking to gather information to take more steps. Medicare will continue to be prohibited from directly negotiating prices by law.

He would instead give private entities more tools to negotiate better deals on behalf of consumers, insurers and employers.

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