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gressive action yet, to target escalating drug prices in the U.S.
A proposal announced Thursday by President Trump and Azar
would base payments for some drugs off of lower prices in other
countries. The policy would only apply to Medicare Part B,
which covers drugs administered in doctors’ offices.
The administration is “not turning back” from its efforts to
lower drug prices, Azar said. “We will put American patients
first by reforming how Part B pays for drugs, and this reference
pricing model will happen.”
PhRMA — the deep-pocked trade group representing
pharmaceutical companies in the U.S. — came out swinging
after the announcement, arguing it would “jeopardize
access to medicines.”
Azar responded Friday to that criticism, saying “something
has to change” and that the administration’s model would increase
patient access.
“This is widely understood across the health care spectrum,
and it’s been a long time coming,” he said. “The only thing
standing in the way is the one special interest that has benefited
from this program far out of proportion to any other actor
for the last 15 years: the pharmaceutical industry.”
A study released by the administration Thursday says Medicare
pays 80 percent more than other advanced industrial
countries for some of the most expensive medicines administered
at doctors’ offices.
Azar argued that over the next five years, that percentage
would drop to 26 percent, and the U.S. would save $17 billion,
under the administration’s plan.
Azar said it’s unlikely pharmaceutical companies would
stop selling drugs to the U.S., especially since under
the proposal it would still pay more for those drugs
than other countries.
“Not only are drug companies never going to walk
away from the world’s largest payer for prescription
drugs, they’re certainly not going to walk away
while they’re still getting paid a quarter more than
they are elsewhere.”
The administration will accept public comments before implementing
its proposal, which doesn’t require congressional
approval. It’s certain to face strong headwinds from the pharmaceutical
industry, which is on track to spend more on lobbying
this year than it has in recent history.
Trump’s Drug Pricing Reform Proposals May Be Politically
Tepid But Are Sensible Policy
With HHS Secretary (and former Eli Lilly executive) Alex Azar
by his side, President Trump stepped to the podium in the gloriously
sunny White House Rose Garden yesterday afternoon
and promised that “we are going to see prices go down, and
it will be a beautiful thing.” Based upon the actual blueprint,
which remains a work in progress, be the case. But if it proves
to be so, it will not be because the administration is wielding
the metaphorical meat cleaver to cut prices by government
edict and risk gutting our biomedical innovation engine.
Instead – and, it must be said, uncharacteristic of Trump – he
appears to have listened to sober, serious, well informed folks
like Azar and FDA Commissioner Scott Gottlieb, and opted to
endorse a series of incremental policy and market-based reforms
that will eliminate many of the existing incentives that
compel drug manufacturers to push list prices ever higher.
As has been noted by market watchers, industry analysts and
healthcare sector investors breathed a collective sigh of relief.
They had feared a draconian proposal that might have led
to the re-importation of pharmaceuticals shipped out of the
country for marketing in Canada, or allowed the Federal government
to negotiate directly with manufacturers under the
Medicare Part D outpatient prescription drug program.
But Trump did not go there.
Notably, the administration outlined what it regards as incentives
for irresponsible pricing and business practices that hurt
American consumers and drain government coffers. ⚛
"These relatively modest proposals will not
satisfy Democrats who remain fixated on
White House outlines reforms to lower drug prices
The White House’s Council of Economic Advisers
adopting a single payer
on Friday
system
recommended
where
easing government
the
regulations to lower drug and reinforcing
Federal government can set prices, as is the
the Food and Drug Administration’s push to spur
competition through expedited approvals.
case in western Europe"
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