November 3, 2020

USA: President Trump Signed Executive Orders Aimed At Lowering Prescription Drug Costs. Trump Will No Longer Allow The U.S To Subsidize The Costs Of Socialized Health Care In Countries Like Canada And Germany.

Washington Examiner
written by Cassidy Morrison, Healthcare Reporter
Friday July 24, 2020

President Trump signed four executive orders on Friday that aim to lower prescription drug prices, seeking to add to his healthcare reform credentials amid sagging approval ratings.

“They represent the most far-reaching prescription drug reforms ever issued by a president, nothing even close,” Trump said in a press briefing on Friday.

The orders would have to be translated into official rules by agencies and are not likely to be in place before the election. Still, Trump portrayed the signing as a blow for seniors against pharmaceutical companies and foreign freeloaders.

The first of four orders will mandate discounts on insulin for hospitals to be passed down to patients.

“These providers should not be receiving discounts for themselves while charging their poorest patients massive, full prices. Under this order, the price of insulin for affected patients will come down to just pennies a day from numbers that you weren't even able to think about. It's a massive cost savings,” Trump said.

Trump will also allow cheaper versions of the same prescription drugs to be imported from Canada, a proposal that drug companies have rebuked.

The Trump administration first released a proposal to import inexpensive drugs in July 2019. The proposal, the Safe Importation Action Plan, called for rulemaking to authorize state, wholesaler, or pharmacy plans to try to set up drug importation programs that abide by Food and Drug Administration safety standards. The FDA would also work with manufacturers to assure that drugs sold to foreign countries abide by FDA regulations to be sold in the United States.

The Pharmaceutical Research and Manufacturers of America, a powerful drug lobbying group, has opposed drug importation, citing potential health risks to American consumers. The Canadian government has also rejected importation proposals, saying importation would deplete the country's own supply of prescription drugs.

Trump also revived a 2019 rule that never came to fruition after pushback from pharmacy benefit managers, which negotiate drug prices with insurers. The proposed rule would require PBMs in Medicare Part D to pass discounts negotiated with insurers directly to the patients using those drugs, allowing Medicare beneficiaries to save money on medications.

Trump said Friday that his new executive order would cut out the “middlemen" and "middlewomen” and directed Health and Human Services Secretary Alex Azar to “complete the rule-making process he commenced.”

Just as they did in 2019, pharmacy benefit managers are expected to retaliate. The PBM sector has planned an ad campaign to oppose any effort to eliminate rebates and play it as a political mistake that could raise drug costs for the elderly in swing states ahead of the November election, Politico reported.

“The middlemen are making a fortune, and pharmacy benefit managers and people are just bilking Medicare patients with these high drug prices while they pocket gigantic discounts, gigantic discounts,” he said.

The president will also implement a mandate that pharmaceutical companies sell prescription drugs in the U.S. at the same prices as in other countries, called the international drug-pricing index or the “favored nations clause.” Trump has long decried what he calls a "global freeloading" system in which drug companies are able to offer their products at a lower cost to other countries by charging the U.S. more. He first proposed the initiative in July 2019.

“It also means that the U.S. taxpayers are effectively subsidizing the socialist healthcare systems of foreign welfare states and many other countries,” Trump said. “We will end that abuse and restore the principles of free enterprise. ... This has to do with common sense and courage, to be honest.”

Trump said he’ll be meeting with executives from the pharmaceutical industry Tuesday to discuss ways to lower drug prices and out-of-pocket expenses. He added that if the talks are “successful,” the fourth executive order could be scrapped.
written by Peter Ubel
April 18, 2014

People have criticized The Affordable Care Act for amounting to a large transfer of wealth, from wealthy Americans to those not as well off. But the real transfer of wealth has been from United States to other developed nations, whose healthcare costs we have subsidized for many years by paying so generously for many of our healthcare services. No better example of this comes to mind than the price we pay for pharmaceuticals in the US versus elsewhere. Below is a picture of what we pay for brand-name drugs here compared to peer nations.

Pharmaceutical products are cheaper abroad in part because companies know they can make money in the US market, and thus are willing to tolerate smaller profit margins in other countries.

In effect, therefore, we are subsidizing the cost of healthcare in those other countries. And not just any old countries. Some of the richest countries in the world – like Switzerland and Germany. If we negotiated pharmaceutical prices more aggressively here in the US, the pharmaceutical industry might be more reluctant to accept lower prices elsewhere. More likely, lower prices in the US would mean lower profits for the industry. This would undoubtedly have an effect on the willingness of pharmaceutical companies to invest in new products. Nothing promotes research spending better than the promise of future profits. It is worries about such research incentives that have caused some people to argue against negotiating lower prices with pharmaceutical companies. To lower profit margins, they contend, would be to slow down medical progress.

But is it the job of the United States to provide profits to the pharmaceutical industry, so they have an incentive to develop new cures? Is it people in United States who should pay for the majority of this research, simply because our friends in Europe are tougher negotiators?

In the United States, we have a health care cost problem. We spend significantly more money on healthcare than our peers. And a big portion of this cost problem is a price problem . Our doctors make more money than similarly trained doctors in Europe. Our hospital executives make more money than their peers in Canada. And we pay more money for prescriptions than we would if we lived elsewhere.

It is time to worry less about promoting industry profits, and focus more on controlling healthcare spending. That means becoming tough negotiators, with hospitals, pharmaceutical companies, device manufacturers and the like. It is wrong to ask the American public to be sugar daddy to Western Europe.

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